June 8, 2020

By means of Legislative Decree No. 798 of June 4, 2020, the Ministry of Mines and Energy (Minminas) adopts measures in favor of the mining-energy sector within the framework of the economic state of emergency, decreed by the National Executive. 

A. In relation to the mining sector, Minminas takes the following measures: 

  1. Provide financial support to small-scale miners and subsistence miners. In order to strengthen their productive activity of these miners. For this purposes, it is established that Minminas has the possibility to enter into agreements with financial institutions in order to allocate its investment budget resources so that the financial institutions provide lines of credit and guarantees to small-scale miners and subsistence miners.
  2. Distribution of royalties caused by the commercialization of minerals without identification of origin among the producing municipalities that have subsistence miners duly subscribed or authorized, according to the methodology to be established by the Minminas, in order to carry out investment projects that have as purposes the implementation of the necessary actions for the attention and humanitarian aid related to COVID, including in-kind food projects, food strategy, monetary aid and payment of public services.

B. In relation to the hydrocarbons sector, the following measures are taken:

In order to mitigate the economic effects of the low demand for aviation fuel, retail distributors of jet aviation fuel and/or aviation gasoline 100/130, whether national or imported, that had inventories of these fuels as of April 15, 2020, will be eligible for the tax benefit provided in article 484 of the Tax Statute.

C. Measures applicable to the hydrocarbon and mining sector.

Apply the mechanism of the Tax Refund Certificate (CERT), temporarily and subject to the conditions that the Minminas and the Ministry of Finance will publish, to investments made from the entry into force of the Decree and until December 31, 2021 in the hydrocarbons and mining sectors, all according to the quota established by the Ministry of Finance.

  1. In the hydrocarbons sector, the investments that may be beneficiary are those made in exploration and production projects that aim to:
    a.    Preserve production levels through contractual compliance and development of infrastructure.
    b.    Protect the development of proven reserves that could be at risk due to the effects of the fall in international oil prices and the decrease in activities as a result of COVID.
    c.    Promote exploratory activities that increase proven and probable reserves.
  2. In the mining sector, the investments that may be beneficiaries are those that:
    a.    Aim to maintain or increase the production of current projects.
    b.    Accelerate projects currently in the construction and assembly stage in transition to production stage.
    c.    Increase mining exploration projects.

Decree 798 of 2020



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