In August 2017 Egypt’s president Abd El Fatah Elsisi issued law no. 196 for year 2017 “law for gas market activities regulation” the milestone of liberalizing the gas market in Egypt.
The new gas law was drafted and issued to start a new stage of developing the gas market by allowing the private sector to sell gas in the domestic market and encouraging new investment in the activities of gas shipping, transmission, distribution, storage, supply, marketing, trading and LNG activities. Many opportunities are now allowed for the private sector to take advantage of them, the most important one is allowing the third party access on a nondiscriminatory bases to the gas facilities.
The new gas law mentioned in article (2) the foundation of the GasReg and in article (4) The law stated that GasReg shall exercise all powers necessary to achieve its objectives including without limitation setting development and business plans, work programs and management rules and techniques that will enable the GasReg to perform its functions, including in particular the following:
- Regulating relations among Gas Market Participants in accordance with the laws, decrees and regulations in force in the Arab Republic of Egypt.
- Issuance, modification, renewal, suspension, cancelation of licenses needed to carry out Gas Market Activities and identifying the general liabilities and requirements by which the licensees shall adhere after fulfillment of all the necessary requirements and obtaining the necessary approvals.
- Approving the Gas Facilities codes after consultation with their operators.
- Approving the gas transmission code for transmitting gas through any way or facility other than the gas transmission facilities and setting the tariff calculation there to methodology.
- Preparing the necessary rules to allow the licensees to gain access to and use the Transmission System and Distribution System without discrimination.
- Reviewing investment plans for the Gas Facilities.
- Setting the methodologies for the calculation of tariffs for Gas facilities, and monitoring such tariff application taking into account the interests of all Gas Market Participants.
- approving the contractual terms and conditions for the activities of Gas Transmission, Gas Distribution, Gas Storage and Regasification as well as for the Gas supply standard contracts to the Eligible Consumers.
- following-up and monitoring licensees in practicing the Gas Market Activities in order to regularly evaluate their performance, according to the Gas Market regulations.
- Setting Gas Market Activities unbundling rules that apply to the Gas Market Participants to ensure fair competition provided that GasReg shall evaluate the unbundling process taking into account the interests of all Gas Market Participants, and in compliance with law for competition and prevention of monopolistic practices.
- Accessing documents and information relating to the Gas Market Activities with respect to the license, and the development and issuance of specific mechanisms to acquire necessary information in order to ensure the accuracy and integrity of regulation process for Gas Market Activities.
- Preparation of technical studies and proposing the prices of gas sale to Non-Eligible Consumers in coordination with the concerned parties within an equal, fair and transparent framework then send such studies and prices to the Cabinet of Ministers for ratification.
- Proposing the criteria for Eligible Consumers identification.
- Handling the complaints submitted by Gas Market Participants to GasReg and using endeavors to settle such complaints in accordance with the provisions of the Executive Regulations.
- Availing information, reports and recommendations Gas Market Participants, so that they can discern to their rights and obligations.
- Providing technical consultation and recommendations related to the Gas Market.
- Ensuring that the Gas market activities are carried out in a transparent and competitive manner taking into account the interests of all Gas Market Participants.
- Participating in the preparation of draft laws and decisions related to the Gas Market Activities and presenting such to the Competent Minister to ensure that no discrepancies or damage would affect the objectives of the regulation of the Gas Market Activities.
- Identifying the Suppliers of Last Resort.
- Making, and updating from time to time when necessary. a standard contract model for gas sale to eligible consumers.
Many article was drafted in the Law to organize the following:
- The gas market activities.
- The Role and objectives of GasReg.
- The composition of the board of directors of the GasReg and how it will be appointed.
- The gas market activities licenses.
- Organizing the gas market activities.
- The unbundling of activities.
- The rights of the gas market activities.
- Economic regulations and tariff.