Petroleum and petrochemical operations now require a license: The Kingdom’s new Petroleum and Petrochemical Law requires companies to obtain a license for all operations in the sector, Saudi Gazette reports. The new law — approved by the council of ministers earlier this month — replaces the old Petroleum Products Trade Law, aiming to attract investments, support industry localization, and prevent illegal practices like smuggling and false reporting.

The details: The new law stipulates sales and purchases of petroleum products must be priced at the global prices. Establishing petrochemical facilities will also need prior approval from the Energy Ministry, with inspectors holding expanded powers to monitor facilities, investigate violations, and seize items suspected of breaching regulations.

The Energy Ministry may also deny or revoke export licenses for violators, according to the provisions of the law. Violations include “Supplying the ministry or the public with false or misleading information or data related to petroleum or petrochemical operations or materials; … tampering with storage levels for the purpose of liquefying or selling it or disrupting the security and reliability of petroleum and petrochemical supplies,” according to Saudi Gazette.

Unlicensed exporters of petroleum product could face up to five years in prison, and a fine up to SAR 30 mn or twice the value of the seized products at global prices, as well as confiscation of illegally traded materials.

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