ASSESSING THE DECREE LAW FOR ROVUMA LNG: GOVERNMENT CONCEDES TO COMPANY DEMANDS

Following negotiations with the American and Italian multinational companies, Anadarko and ENI, the Council of Ministers approved the decree-law establishing the legal and contractual regime applicable to the Liquefied Natural Gas Project (LNG) for areas 1 and 4 of the Rovuma

Basin on the 28th November 2014. Our analysis focuses on four main issues: fiscal stability, the exchange rate regime, unification of the gas-fields and local labor/content. Companies managed to secure their objective of 30 years of fiscal stability, even though Parliament authorized stability in only 10-year increments, by agreeing to a small increase in the production tax in the 2030s and another increase in the 2040s.

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