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The closing of the refinery had a huge impact on the Panamanian hydro-

carbon market. Texaco continued to be, in 2001, the monopoly provider of

Permission to supply petroleum derivative products  through barges; for those who sell fuel by barge.

oil derivatives in the country. The new situation obligated the government

Permission to import fuel for electricity generation;

to adapt their hydrocarbon policies to prioritize the modernization of the

Permission to import Liquefied Petroleum Gas.

fuel import market. In that context, the September 2003 Cabinet Decree

Limited the duration of operation contracts in petroleum

No. 36 was passed, which “establishes a national hydrocarbon policy.”35

free zones to 15 years, with the potential for one additional extension of 5 years.

Decree No. 36 repealed the 1992 liberalization decree and all its re-

Created the National Strategic Oil Derivatives Products 

forms. It became the main legislation for the hydrocarbon market since

Reserve; which obligated all the import and distribution

its text contained provisions on all market activities. Among the most

companies to have a permanent derivatives reserve the

important issues incorporated into decree No. 36 are:

equivalent of 10 days of sales; •

• •

rity price, which is the maximum price at which an im-

General of Hydrocarbons on the oil market;

porter can sell products to a distributor on the domestic

It regulated conditions and obligations for awarding con-

market;

tracts and permits; •

Established the mechanism for calculating the import pa-

It established the powers and functions of the Directorate

Created the Governmental Coordination Committee on 

It established all provisions relating to petroleum free zo-

Hydrocarbon Activities, which had the goal of providing

nes, including the requirement that all oil derivatives di-

assessment to the Directorate General of Hydrocarbons,

rected at the domestic market should first pass through

the Department of Revenue, the General Customs Direc-

petroleum free zones;

torate and other State institutions that would require it.

Created 11 types of permits for market players on the oil derivatives market, among them:

Between 2004 and 2005 four decrees were issued reforming parts of

User permit for the petroleum free zone Type A: allows

decree No. 36. They modified provisions about administrative affairs,

the sale of derivatives to the domestic market;

changed characteristics of the strategic reserve of petroleum products

User permit for the petroleum free zone Type B: does

and allowed the import of asphalt without it having to pass through

not permit sale to the domestic market, only authori-

petroleum free zones in addition to other issues.

zes the sale of derivatives to third parties outside of Panamanian territory; 35

Portion of the title of the decree.

Energy Dossier Panama

60

energy dossier: panama  

this dossier analyzes the energy sector in panama as it stood in 2010 and its changes over time. it describes the country's energy flow by c...

energy dossier: panama  

this dossier analyzes the energy sector in panama as it stood in 2010 and its changes over time. it describes the country's energy flow by c...

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