On October 26, 2021, the Legislative Assembly of El Salvador approved the Legislative Decree No. 190, which contains the Law on the Creation of the General Directorate of Energy, Hydrocarbons and Mines; said decree was published in the Official Gazette number 212, volume 433, dated November 8, 2021, and its validity will begin one year after its publication.
The purpose of this law is to create the General Directorate of Energy, Hydrocarbons and Mines, establishing that this Directorate will have all the functions in the matters relevant to this law, so that when the National Energy Council, the General Directorate of Hydrocarbons and Mines and the Ministry of Economy are mentioned in the legal provisions as far as this law is concerned, it will be understood that these functions will be exercised by this new Directorate.
The purpose of the Directorate is the formulation, adoption, monitoring, evaluation of compliance with the policies, strategies, plans and regulation of the Energy, Hydrocarbons and Mines Sectors, as well as to authorize, regulate and supervise the operation of those who participate in said activities, clarifying that supervision includes surveillance, control, evaluation, inspection and control, being able to demand compliance with policies, strategies, plans, laws and applicable regulation as well as may impose sanctions.
This Directorate will have the power to represent the Executive Branch as the highest entity in energy matters. On this point it is pertinent to clarify that the law mentions that all the powers, competences, powers, attributions and duties that were attributed to the current National Energy Council will be transferred to the Directorate; as well as in matters of hydrocarbons and mines, where the powers, competences, powers, attributions and duties of the Directorate of Hydrocarbons and Mines and the Ministry of Economy as far as the Energy, Hydrocarbons and Mines sector is concerned, will be transferred to the Directorate.
The law establishes specific powers of the Directorate with respect to each sector, that is, for the Energy Sector, the Hydrocarbons Sector and the Mining Sector, highlighting that in each of these sectors the Directorate will be responsible for elaborating, formulating or approving the policies of each sector.
Within the Energy sector, the Directorate will monitor policies, regulation and strategies, and ensure that the plans of the sector's participants comply with them, among other powers. In the hydrocarbons sector, the Directorate will be the entity in charge of processing the concessions for the exploration and exploitation of hydrocarbons proposed by the CEL, after approval of the Legislative Assembly; it will also regulate and monitor the import and export, as well as the deposit, transport, distribution and marketing of petroleum products, the construction and operation of warehouses and tanks for private consumption, service stations, liquefied petroleum gas packaging plants and other activities as established in the Law Regulating the Deposit, Transport and Distribution of Petroleum Products. Also, with respect to the Natural Gas Law, the Directorate will have the power to regulate the reception, storage, regasification, transport, distribution and commercialization of natural gas.
Regarding the applications, administrative and judicial procedures and administrative appeals that were pending at the entry into force of this law, it is established that these will be processed by this Directorate.
