Congo: CLG Experts Unpack Upcoming Gas Code and Investment Opportunities
The issue of the Natural Gas Regulations will undoubtedly be discussed at the Congo Energy and Investment Forum held in Brazzaville from 24 to 26 March 2025. This regulatory milestone aims to provide a clear, structured framework for gas exploration, production and commercialization, strengthen investor confidence and unlock the full potential of the country’s vast natural gas reserves. As part of the forum, CLG Congo, a leading legal and business consulting firm in the energy sector, will play a key role in the discussion around regulatory reforms. In an interview with Energy Capital and Power (ECP) (ECP) (ECP) (ECP) (ECP) (www.energycapitalpower.com), CLG Taxation and Legal Director Daoudou Mohammad Yves Ollivier shared their insights into the country’s upcoming gas regulations, regulatory environment and upcoming opportunities.
Please outline the current activities of CLG in Congo, especially those related to the energy sector?
CLG Congo is a leading provider of legal, tax and business consulting services that work closely with oil and gas companies. In 2024, CLG participated in Trident Energy’s acquisition of Chevron, as well as overall interests in Lianzi, Nkosa and Nsoko 2 and Moho Bilondo Fields. Trident now accounts for 15.75% in Lianzi Field, 85% in Nkosa and Nsoko 2 fields, and Moho-Bilondo holds 21.5%. To expand our client base, we actively participate in major energy events such as Africa Energy Week in Cape Town and are honored to partner with Capital Energy & Power as legal counsel for CEIF 2025.
How does the legislative framework of the Republic of Congo affect foreign investment in hydrocarbons?
Historically, about 80% of the country’s direct investment comes from oil and gas, reflecting its economic dependence on hydrocarbons. To improve investment conditions, the government has established an investment promotion structure, including public-private partnership (PPP) agencies and dedicated international cooperation and public-private partnership ministries.
The Hydrocarbon Act 2016 introduces bids for competitive exploration rights, increasing transparency and investor confidence. However, a natural gas code is still needed to provide a specific legal framework for natural gas investment. The draft currently developed by international institutions aims to ensure foreign capital and simplify regulations for competitive and structured industries.
What financial incentives do Congo companies offer to attract energy investment?
What the government provides is corporate tax exemptions and reduced tax exemptions for oil and gas projects negotiated in production sharing contracts. The company also benefits from customs incentives such as the IM5 temporary import system, which allows import of duty-free equipment under reexport conditions. These measure investors’ entry costs are lower and improve profitability.
What are the main expectations for natural gas regulations? How does the regulatory framework improve investment conditions?
The Natural Gas Act is expected to provide a clear legislative framework for gas monetization, fiscal provisions and resource management in 2025. The draft was submitted to the gas company at the end of 2023 and will be approved after modification. In addition, the gas master plan developed by SNPC and McKinsey is designed to increase investment and expand gas utilization in Congo.
Another key issue is the VAT Act (2023-1337), which extends VAT to previously exemptions from oil and gas operations. Discussions are underway between government and industry players in search of compromises that suit all parties.
How does the regulatory framework affect local content development in the oil and gas industry?
Despite the Local Content Order of 2019, law enforcement remains a challenge. The law provides for 70% of the Congo’s employment in management positions, but lacks a clear compliance mechanism. Companies try to follow these guidelines, but without effective monitoring, implementation will be different. Strengthening the verification process is crucial to the sustainable workforce development of the industry.
What are your main expectations for the 2025 Congo Energy and Investment Forum?
We believe this is an opportunity to interact with foreign investors and demonstrate the gasoline potential of Congo, which includes important projects such as 284 billion cubic meters of proven reserves and ENI’s Tango Flng and Wing Wah’s Banga Kayo Gas Project. The forum will allow direct dialogue with policy makers, allowing us to propose solutions to industry challenges such as the Natural Gas Regulations and Fiscal Reform. We also aim to highlight investment opportunities and regulatory reforms. Discussions on topics such as the Natural Gas Regulations, the VAT Act and the Hydrocarbon Code update are crucial to ensuring a competitive and attractive investment environment.
Distribution by Apo Group on behalf of energy capital and power.
