PROGRAM FOR THE PREVENTION AND COMPREHENSIVE MANAGEMENT OF METHANE EMISSIONS WITHIN THE HYDROCARBON SECTOR (“PPCIEM”)

Compartir

PROGRAM FOR THE PREVENTION AND COMPREHENSIVE MANAGEMENT OF METHANE EMISSIONS WITHIN THE HYDROCARBON SECTOR (“PPCIEM”)

Last November 6, 2018, the National Agency of Industrial Security and Environmental Protection for the Hydrocarbon Sector (ASEA for its acronym in Spanish) published in the Federal Official Gazette the “General administrative dispositions establishing the Guidelines for the prevention and comprehensive management of methane emissions within the Hydrocarbon Sector”, (herein after “the Guidelines”), same that entered into force on November 7, 2018.

The Guideline’s purpose is to set forth the actions and mechanisms that Regulated Parties shall adopt to prevent and control the methane emissions generated in their facilities.

The Guidelines are mandatory for Regulated Parties with both New Facilities ^[1] and Existing Facilities^[2]  in which the following activities take place:

• Exploration and extraction of hydrocarbons with the corresponding plan or program, either provisional, of exploration, of evaluation or of development, approved by the National Hydrocarbon Commission.

• Treatment, refining and storage of petroleum with the corresponding permit from the Ministry of Energy or the Energy Regulatory Commission, as applicable.

• Processing, compression, liquefaction, decompressing, regasification, pipeline transport, storage and distribution of natural gas, with the corresponding permit from the Ministry of Energy or the Energy Regulatory Commission, as applicable.

According to the Guidelines, Regulated Parties have, among others, the following obligations:

• Identify the sources and potential sources of methane emissions within their facilities and prepare a methane diagnosis to be reported before ASEA.

• Prepare a Program for the Prevention and Comprehensive Management of Methane Emissions within the Hydrocarbon Sector (PPCIEM for its acronym in Spanish) in which, among others, the information concerning actions for the prevention and comprehensive control of emissions as foreseen in Title Third of the Guidelines shall be included.

• Hire the services of an Authorized Third Party to rule over the PPCIEM annually[3].

[1] Those built after the entering into force of the Guidelines.

[2] Those built before the entering into force of the Guidelines as well as those that have not been built yet but over which Regulated Parties hold a permit from the Ministry of Energy or the Energy Regulatory Commission or, regarding exploration and extraction activities, with a program approved by the National Hydrocarbon Commission.

[3] Until ASEA does not have a data base of Authorized Third Parties to issue the corresponding ruling, Regulated Parties may submit, for the Agency’s consideration, a legal entity that can demonstrate its experience and national or international recognition within the scope of the activities to be evaluated.

New Facilities, once their emission diagnosis is completed, shall maintain the methane emission volume of the baseline year (first diagnosed year) in the following years.

Existing Facilities shall incorporate a comprehensive goal of methane emission reduction in their PPCIEM, same that shall be technically feasible with regards to the baseline year, and that shall be achieved within no more than 6 years.

Regulated Parties shall prepare their PPCIEM with the first twelve months from their starting operations date, when referring to New Facilities, and from the entering into force of the Guidelines when referring to Existing Facilities.

Once implemented, Regulated Parties shall carry out annual evaluations of the PPCIEM’s implementation and file a compliance report before ASEA, accompanied by the corresponding Ruling.

The Environmental Law Practise of the firm will be pleased to provide any additional information on the topic.

SINCERELY

Mexico City, November 15th, 2018