Hydrocarbons Law No 08/2006

Last updated: 23 December 2020

The Hydrocarbons Law stipulates that all hydrocarbon reservoirs in Equatorial Guinea, including its inland waters, territorial waters, exclusive economic zone and continental shelf, are the exclusive property of the state and therefore public domain goods (Art.1). Thus, the state is the holder of all hydrocarbon exploitation rights in Equatorial Guinea and has the right to perform petroleum operations through its national companies or an association with a contractor.


Contractor’s activities shall be authorised and regulated by the Ministry of Mines and Hydrocarbons. This ministry is responsible for negotiating, signing and executing all contracts between the state and contractors as well as for amending the terms of any contracts to ensure that petroleum operations are carried out for the benefit of the state.


Article 5 defines that all petroleum operations are to be conducted in a prudent manner using the best technical and scientific practices available in the petroleum industry and taking into account the safety of persons and facilities, as well as the protection and sanitation of the environment and the conservation of natural resources.   


Chapter III indicates that the Ministry of Mines and Hydrocarbons is the state entity responsible for the formulation, regulation and monitoring of petroleum policies, as well as the administration, planning, implementation, supervision, inspection, auditing and enforcement of all oil and gas developments and all activities relating thereto.


Chapter XIV provides for environmental protection and sanitation, health and safety. It indicates that, in carrying out activities, contractors and their associates shall take all precautions necessary to protect and preserve the environment. Precautions include those in respect of health, water, soil and subsoil, air, the preservation of biodiversity, flora and fauna, ecosystems, landscape, atmosphere and cultural, archaeological and artistic heritage (Art.65).


Chapter XVI, on natural gas, states that all associated natural gas that is produced and not utilised in petroleum operations is the property of the state. It further outlines that contractors and their associates are strictly prohibited from flaring any quantity of natural gas. The Ministry may authorise flaring of minimum quantities of gas if so requested in a pertaining report including technical, economic, financial or environmental reasons for flaring, which, in the opinion of the contractor, unavoidably result in the need for flaring.  In this case, the Ministry shall have sole discretion to authorise flaring, with or without requesting compensation by the contractor and/or its associates.


This legislation also outlines applicable royalties, taxes, penalties and sanctions.

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