DR Congo Parliament has adopted a new code for hydrocarbons exploration that the country hopes will allow it to draw more benefits from its expanding oil sector
The Central African mining nation pumps 25,000 bpd, accounting for 11 per cent of its export revenues, although exploration off the Atlantic coast and near its eastern border with Uganda could increase that significantly, Reuters reported.
Perenco, an Anglo-French oil and gas company, is DR Congo’s only active producer of oil, but Total is exploring oil near Lake Albert, on the Ugandan border.
The Bill’s passage was recently announced in a statement by the president of the National Assembly Aubin Minaku.
“The implementation of this law will allow DR Congo to assure the security of investments and to put in place a fiscal regime that permits the state to profit from its hydrocarbon resources so that those contribute in particular to growth and the fight against poverty,” Minaku said.
The code, which has not yet been made law by President Joseph Kabila, would replace a 1981 law, widely considered to be obsolete. The final text of the bill was not immediately available. Previous drafts have included a 40 per cent capital gains tax on all contracts, although it was not clear if this clause remained in the version adopted by Parliament.
A point of controversy among lawmakers was a provision in the National Assembly version that would require oil companies to cede at least 20 per cent of shares in their operations to a ‘national society of commercial character’. The Senate called the provision ‘contrary to the principle of economic liberalism’ and said that it risked creating conflicts of interest.
Juvenal Munubo, deputy from the opposition Union for the Congolese Nation (UNC) party, noted that the new code could help shed light on the sector. “It will allow, unlike in the current situation, to know who is acting in the hydrocarbons sector, the parties, their identities, where they are located,” he added.