A new ministerial order that provides the new terms and conditions applicable to land concessions ("CUOs") granted over State-owned land for the development of NCRE projects ("Ministerial Order"), was issued the Ministry of National Assets ("MNA") and published on the Official Gazette on May 11, 2017.
The Ministerial Order aims to facilitate the existing conditions and support the development of NCRE projects over State-owned land by providing flexible mechanisms to promote the study of energy sources and extending existing terms for the fulfilling of construction and other obligations assumed by concessionaires.
A brief description of the main elements of the Ministerial Order is set forth below:
Extension of the CUOs' validity term. The validity period of the CUOs is extended from 30 to 35 years. Extension of the construction period. The construction period of the CUOs is extended from 48 months to 10 years. Amount of the performance bonds to be provided by concessionaires. i) During the construction period, a bank bond guarantee equivalent to 25% of the market value of the land must be provided. ii) During the operation of the project, a bank bond guarantee equivalent to 50% of the market value of the land must be provided. Prospection Permits. The implementation of monitoring stations and the execution...