Amendments and additions to the Law “On hydrocarbons (research and production), as amended”

Official Bulletin no. 26, dated 20 February 2017

On February 20, 2017, the Parliament of the Republic of Albania approved Law no. 6/2017 whose object is to make some amendments and additions to the law in force no.7746, dated 28.7.1993, “On hydrocarbons (exploration and production)”, as amended, in order to improve the law by reflecting recent developments in exploration and production activities of hydrocarbons in the Republic of Albania.

More specifically, it aims to improve certain provisions of the existing law dealing with the definition of procedures that must be followed to conclude agreements for the  research, development and production of hydrocarbons, including the condition of guaranteeing national security in cases of quota agreement stipulation or transfer, which are based on concepts introduced in directive 94/22 / EC, dated May 30, 1994, “On conditions for granting and using authorizations for the discovery, research and production of hydrocarbons”.

A clearer division of deadlines provided for the research pediod and those regarding the evaluation of a discovery has been made. Likewise, there are some amendments related to the change of the concept of provisions on the fiscal regime stability, by introducing deadlines, such as not to exceed the term of 12 years from the start of production of hydrocarbons and exemption from this regime in some specific cases.

Additions were made in order to restore the commitment of the Scientific Institute of Hydrocarbons and to redefine the rights and obligations of the Hydrocarbons Directorate that is currently part of AKBN, closely related to those of the Scientific Institute of Hydrocarbons. To reflect the new technical concepts of hydrocarbon activity, but also to better understand and interpret the law as a whole, the definitions article has been amended.

One objective of the law is to deal with property relations in the same way as it is dealed with in the law on public-private partnership, by amending Article 10 of the law in force.Also, some corrections related to Article 12 of the existing law were made, in order to reflect the current activity of the company “Albpetrol”, sh.a.