Producers, Transporters, and Consumers of Natural Gas Advocate for Integrated National Market Based on Promoting Competition

Signatory Entities Request a Dialogue with the Government of São Paulo for the Improvement of State Policy and Its Alignment with the Broad Movement of Opening the National Natural Gas Market

The associations representing producers, transporters, and consumers of gas publicly defend the development and strengthening of a broad integrated national market based on promoting competition, diversifying agents, and decentralizing supply chain activities, in accordance with the new framework recently approved by the National Congress: the New Natural Gas Law (Law No. 14,134/21). The text is the result of a decade of discussions and the consensus of most sector agents, with support from the Federal Government.

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The new rules have already resulted in announcements of significant investments and will be crucial for leveraging the vast wealth of pre-salt gas and other supply sources, bringing more variety and competitiveness to the end consumer and benefiting the national economy as a whole.

Recent Publication of State Decree No. 65.889/21 Raises Concerns in São Paulo

In this context, the recent publication of state decree No. 65.889/21 raises concerns, as its content creates inconsistencies with the provisions in the Gas Law, and the intention of the state of São Paulo to anticipate by six and a half years the decision regarding the extension of the concession contract of the São Paulo Gas Company (Comgás), introducing in the addendum rules that go towards regionalization and verticalization, impacting efficiency, competitiveness, and the guarantee of natural gas supply.

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It is worth highlighting that, as the largest natural gas market in Brazil, the state of São Paulo is considered a benchmark, and therefore, it is important that the decision on the renewal of the concession is made following a broad debate, allowing adequate time to technically analyze alternatives and their consequences, and to decide confidently on the path that best serves the interests of São Paulo consumers.

Entities Seek Opening of the National Natural Gas Market to Stimulate Competition

The signatory entities request a dialogue with the government of São Paulo for the improvement of state policy and its alignment with the broader movement of opening the national natural gas market, enabling the benefits of liberalization and increased competition advocated by the Gas Law to be fully experienced by the Paulista and Brazilian society, enhancing the much-needed recovery of the country post-pandemic.

In this sense, the various expressions from public and private agents advocating for greater competition are reaffirmed, as recorded in Public Consultation 10/21, from the Regulatory Agency of Public Services of the State of São Paulo – ARSESP, on the date of 31/08/21.