Abril 21st, 2022
Draft regulation for operation of the fuel distribution chain.

The Ministry of Mines and Energy (hereinafter the “MME”) has identified the need to strengthen the distribution chain of liquid fuels in Colombia from the transparency of the information and central coordination of operations point of view to improve the planning and performance of the activities of the liquid fuel chain in Colombia.

The MME proposes the addition of a chapter to the regulatory decree 1073 of 2015 (hereinafter the “Decree Draft”) to include the necessary provisions for the creation of the agents and its functions related to planning and coordination of the operation of the liquid fuel distribution chain including biofuels and fuels.

The Decree Draft proposes the definition and creation of the administrator of the operations of the liquid fuel distribution chain, establishing that it will be the entity that the Colombian Government defines, responsible for the collection, and the centralization of transactional and operational information, as well as the planning, coordination, optimization and monitoring of the integrated operation of the fuel distribution chain (hereinafter the "Operations Manager").

In its first section, the Draft Decree establishes the functions of the Operations Manager of the liquid fuels distribution chain including the following: (i) implement and execute the orders given by the MME for the application of the regulation and public policy regarding liquid fuels; (ii) survey and coordinate the operation of the members of the liquid fuel distribution chain, their activities and resources associated with the fuel chain, centrally and in real time; (iii) report to the MME the possible non-compliances of the members of the liquid fuels distribution chain, regarding the obligations derived from the operations manual and/or the applicable regulation; (iv) generate the protocols for information systems, technological and digital tools for its operations; (v) perform functions related to the gathering, monitoring, and management of information on the liquid fuel distribution chain; and (vi) its functions as the national control center for the operations of the liquid fuel distribution chain, among others.

The second section of the Draft Decree, creates the liquid fuel advisory council, that will be composed by: (i) MME; (ii) a representative of the importers of fuels; (iii) a representative of biofuel importers; (iv) a representative of the refiners; (v) a representative of the fuel transporters; (vi) two representatives of the wholesale fuel distributors; (vii) two representatives of the fuel retailers; (viii) a representative of the biodiesel producers; and (ix) a representative of the ethanol-producers; (x) a representative of the Operations Manager. 

The Draft Decree establishes the purpose and functions of said council, including the following: (i) provide technical and logistical recommendations regarding liquid fuel to the MME to ensure that the supply developed under economic efficiency criteria; (ii) provide recommendations on modifications, substitutions, and additions to the operations manual of the Operations Manager, among others. The Draft Decree also establishes the operating and decision-making mechanisms of this council. 

The third section creates the multi-sectoral strategy commission that will act as an advisor to the Colombian Government and other authorities for the implementation of measures to guarantee an efficient response to potential or materialized situations of international emergency by which a reduction or interruption of the supply or inventories of hydrocarbons and/or liquid fuels or an increase in their prices can reasonably be anticipated.
This commission will be composed by the following members: (i) a representative of the MME. (ii) a representative of the Ministry of Finance and Public Credit; (iii) a representative of the Ministry of Transportation; (iv) a representative of the Ministry of Environment and Sustainable Development; (v) a representative of the Ministry of Agriculture and Rural Development; (vi) a representative of the Ministry of Commerce, Industry and Tourism. (vii) a representative of the Mining and Energy Planning Unit; and (viii) a representative of the National Hydrocarbons Agency. The MME will regulate its functions and operations.

The Draft Decree will be open for comments until April 23rd and can be reviewed in the following link: https://www.minenergia.gov.co/documents/10192/24342889/Proyecto+de+decreto+adicio%CC%81n+DUR+AOC+VF.pdf

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