Colombia Update: New rules on the coexistence of overlapping projects in the mining-energy sector

Regulation on overlapping and coexistence of projects in the energy mining sector

The Ministry of Mines and Energy (“Ministry“) issued Resolution No. 40303 of August 5, 2022, which establishes guidelines to facilitate the coexistence of projects in the energy mining sector (the “Projects“), in the event of overlaps, total or partial, between Projects. that they hold the same legal status of public utility and social interest and that they intend to develop in the same areas and provided that such coexistence is technically feasible. The purpose of the guidelines is to determine the procedure to be followed by the developers of the Projects, as well as the role of the Ministry and the other public authorities in the sector.

The following are some of the guidelines established by the Ministry to ensure and promote the coexistence of the Projects:

• Project Information System

The Ministry will enable the National Project Information System of the Energy Mining Sector, as a digital public system to consolidate the updated information of the Projects, which will allow to identify the possible cases of partial or total overlaps, even from the initial phase of the Projects.

• Initial stages

Prior to the signing of the contract for the exploration and exploitation of hydrocarbons or minerals, the National Hydrocarbons Agency (“ANH“) and/or the mining authority shall inform the Mining-Energy Planning Unit − UPME, the Ministry’s Electric Power Directorate, the ANH and/or the mining authority, as appropriate, about the characteristics, scope and geographical delimitation of the Project, in order to verify whether the Project overlaps, totally or partially, with the area allocated to other Projects. If so, the ANH or the mining authority, as appropriate, informs the interested party about the overlap.

• Contractual conditions

Contracts for the exploration and exploitation of hydrocarbons or minerals must include a clause obliging the holders to facilitate coexistence with other Projects in the event that there are cases of overlap with other Projects. Failure to comply with this obligation shall result in the imposition of the procedures laid down in the contract and such other measures as the authority deems appropriate.

• Coexistence agreements 

1.Where overlap arises, project holders shall enter into an Operational Coexistence Agreement (“Agreement”) in order to ensure that activities are carried out in an orderly and efficient manner.

2.The Agreement must deal with the delimitation and establishment of the socio-environmental, technical and security responsibilities of each of the owners of the Projects.

3.For the signing of the Agreement, the holders must complete a negotiation process with a maximum duration of 180 working days.

4.The developers of the Projects must carry out the necessary procedures before each of the competent authorities, in order to incorporate in the contracts or instruments the negotiated aspects and the obligations derived from the Agreement.

By LLOREDA CAMACHO & CO, Colombia, a Transatlantic Law International Affiliated Firm.  

For further information or for any assistance please contact colombia@transatlanticlaw.com 

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