The Government defines the guidelines of the projects of promotion of LNG and Hydrogen production which will be dealt with in extraordinary sessions of Congressand that propose to create a legal framework and incentives for companies to accelerate and increase investments and exports in both industries.
In the case of liquefied natural gas (LNG), the initiative in which the Government is working guarantees among its main points “a percentage of free application of the currencies obtained from LNG exports for thirty years” and “exchange regulatory stability for the payment of financial debts”, according to official sources revealed to Télam.
In addition, it will grant tax benefits on items such as income tax, VAT refund, exemptions for importing goods and favorable conditions regarding export rights.
Those projects that compromise a minimum investment and production capacity of tons of LNG per yearin amounts and values that have not yet been specified.
Likewise, the bill ensures transportation and supply of natural gas for each project and the possibility of accessing a firm export authorization of LNG 365 for 30 years, according to official sources.
As a counterpart to the incentives for companies, the initiative will require national content integration requirements that will escalate periodically, as a condition of maintaining the benefits.
The objective is to achieve that the projects, as time passes, incorporate locally produced goods and inputs.
This item is replicated in the draft law for the promotion of hydrogen in the country. The initiative that will be tried to approve in Congress in extraordinary sessions, includes both blue hydrogen and its pink and green variants.
Its objective is to “promote the value chain and contribute to the decarbonization processes of the energy and production matricesas well as promote the scientific and technological development“added the spokespersons consulted.
Among its main axes, it will grant differential tax benefits by type of hydrogen, which include: income tax; VAT refund; exemptions for import of goods; and favorable conditions regarding export duties that increase ten-yearly.
In addition, it ensures fiscal stability for firms, access to the Free Exchange Market for payment of financial debts, and availability of foreign currency from exports.
Both projects will be dealt with in the extraordinary sessions that are expected to take place from the second half of January. In this regard, at her press conference last Thursday, the spokesperson for the Presidency, Gabriela Cerrutti reported that the official call will come out this week.
In relation to the parliamentary treatment of the different projects, in an interview with the newspaper Perfil, the Minister of Economy, Sergio Massanoted on Sunday that “If the opposition wants to build a great agreement so that we are exporters of liquefied gas, welcome.”
Along the same lines, he expressed that “if they want Argentina to be a great player in green, gray or blue hydrogen, welcome”, thus showing their intentions that the texts be approved unanimously so that companies are clear when investing that the development of these industries has a consensus of all political forces.
If approved, both projects will create promotion regimes for these sectors. In the case of LNG, the law “declares the liquefaction of natural gas for the export of LNG to be of national public interest, with the aim of developing the value chain of the LNG industry, promoting exports and fostering technological development.” .
The other initiative will give rise to “a regime to promote hydrogen with low carbon emissions and other greenhouse gases, with the aim of promoting the value chain and contributing to the decarbonization processes of the energy and production matrices.” according to official sources.
The legislation will serve to grant certainty to companies in industries which, in order to develop, require large volumes of initial investment with returns in the medium and long term. In this sense, providing a legal framework with clear and long-term conditions becomes essential.
Weeks ago, Massa pointed out that “in the great debate that is taking place at this time in the world around the value of energy, energy transition, energy security, we have everything to play that game.”
In addition, the head of the Palacio de Hacienda affirmed that “Argentina in 2025 will be a net exporter with self-sufficiency in both gas and oil, with which there will be a strong change in the Argentine gross product.”
Within this framework, he said that “it is important that we have defined a process of rules, of respect for investments.”
