Oil Security 

   

Oil Security

The Czech Republic has practically no oil of its own and is completely dependent on its export from abroad. If the supplies of this economically crucial commodity are disrupted, the supplies of oil and oil products – emergency supplies – are of extraordinary importance for the Czech Republic. The establishment and protection of these supplies and the preparation of plans and measures for dealing with situations when the supplies of oil and oil products are disrupted is one of the decisive activities of the Administration of State Material Reserves (ASMR).

In the Czech Republic, the concept of the reactions to crisis situations in the supply of oil relies, in particular, on the applicable legislation enabling, among other things, the state’s participation in the relevant emergency measures of the International Energy Agency (IEA) and the European Union (EU). It also relies on the established National Organization for Strategic Solution of Oil Emergency (NOSSOE) and the functional national system of collection of data for the related statistics.

 

 

Basic Legislation

The Czech legislation establishes the appropriate legal basis for relevant and flexible reactions to emergency situations in the supply of oil. It is important that it fully considers the obligations ensuing for the Czech Republic from the membership in EU and IEA. This legislation is then followed by a set of other, in particular, planning documents of various levels of management.

The decisive law pertaining to the spheres of reactions to emergency situations in the supply of oil is Act No. 189/1999 Coll., on Emergency Oil Supplies and the Resolution of Oil Emergency and on the Amendments to Certain Related Acts (Oil Emergency Act), as amended. Other important legislations are Act No. 97/1993 Coll., on the Competence of the Administration of State Material Reserves, as amended, and Decree No. 165/2013 Coll., on the Types of Oil, the Composition of Oil Products for Storage in the Emergency Oil Supplies, the Calculation of Emergency Oil Supplies, the Warehouse Facilities and the Reporting of Emergency Oil Supplies.

A broader legal framework is then provided by the ‘crisis laws’. They concern, in particular, Act No. 240/2000 Coll., on the Crisis Management and on the Amendments to Certain Acts (Crisis Act), as amended, and Act No. 241/2000 Coll., on the Economic Measures for Crisis Situations and on the Amendments to Certain Related Acts, as amended, and other related laws.

 

 

Act No. 189/1999 Coll., on the Emergency Oil Supplies and the Resolution of Oil

Emergency  and on the Amendments to Certain Related Acts (Oil Emergency Act),

defines the basic concepts in the sphere of oil security, sets the method of establishing, maintaining and storing emergency oil supplies, and deals with the issue of protectors. It also regulates the issues of oil emergency, the measures aimed at limiting the consumption of oil, and the use of emergency supplies. Parts of the Act are also the provisions on ASMR’s competence.

Pursuant to such Act, emergency supplies shall be established and maintained by ASMR from oil and selected oil products and shall cover at least 90 days of the average daily net import.

The Act stipulates that the oil emergency status may be declared only by the Government on the proposal of ASMR’s Chairman. Moreover, the emergency supplies may be sold or lent or the right to their management may be transferred only with the Government’s consent.

The Act also elaborates on ASMR’s specific obligations towards the IEA and the EU, such as the obligation to submit statistical overviews on the state of supplies, immediately report any decline in the emergency supplies below the mandatory minimum and the measures adopted to replenish these supplies and the obligation to represent the Czech Republic in the relevant bodies of the EU, IEA and other international organizations.

 

 

Other Laws

Act No. 97/1993 Coll., on the Competence of the Administration of State Material Reserves, as amended, defines ASMR’s position in the system of economic measures for crisis situations and state material reserves and sets the structure of state material reserves. Decree No. 165/2013 Coll., on the Types of Oil, the Composition of Oil Products for Storage in the Emergency Oil Supplies, the Calculation of Emergency Oil Supplies, the Warehouse Facilities and the Reporting of Emergency Oil Supplies, elaborates on Council Directive 2009/19, ordering Member States to maintain minimum supplies of oil or oil products, and European Parliament and Council Directive 1099/2008, on energy statistics. The Decree regulates the types of oil, the composition of oil products for storage in the emergency oil supplies, and the method of calculating emergency oil supplies, defines the warehouse facilities, and determines the reporting of emergency oil supplies.

 

 

Planning Documents

The planning documents important in the sphere of oil security are, in particular, the ‘Oil Crisis Measures Plan’ and the ‘Type Plan for Crisis Situation Resolution – Large-scale Disruption of the Supply of Oil and Oil Products’. Both these documents are prepared by ASMR. The former plan stems from the provisions of Act No. 189/1999 Coll., on the Emergency Oil Supplies, and deals with situations associated with a serious disruption of the supply of oil and oil emergency. In the individual specific situations, it sets the activities, procedures and organizational measures carried out by ASMR, other central administrative bodies, the bodies of territorial self-administration units, and other entities. The latter plan is used by central administrative authorities, in particular, regional authorities and extended-competence municipalities in incorporating the issue of deficient fuels in these authorities’ crisis plans.

 

 

National Organization for Strategic Solution to Oil Emergency (NOSSOE)

NOSSOE is the advisory body of ASMR’s Chairman and is headed by the Chief Director of the State Material Reserves Division. NOSSOE is also responsible for coordinating domestic emergency measures, collaborating with the domestic petrochemical industry and ensuring compliance with the measures of the IEA, the EU and the European Commission.

In the event of threatening or real deficiency of oil, NOSSOE proposes measures aimed at the limitation of consumption of oil and oil products and the drawing of emergency oil supplies and recommends ASMR’s Chairman to propose that the Government declare oil emergency. In cooperation with the Czech Statistical Office and the Ministry of Industry and Trade, it also collects the necessary statistical data, for example, on the drilling, import, export, processing, and sale of oil and the supplies of oil industry. If IEA decides for common procedure, NOSSOE collects and processes demands and voluntary offers, distributes them to the IEA Secretariat, and monitors their implementation. Organizationally, NOSSOE is made up of three working groups – central administrative authorities, the Czech Association of Petroleum Industry and Trade (CAPIT), and the working secretariat.

The first group includes representatives of ASMR’s relevant organizational units and representatives of the Ministry of Industry and Trade, the Ministry of Transport, the Ministry of the Interior, the Ministry of Defence, the Ministry of Finance, and the Ministry of Agriculture. CAPIT’s working group is made up, for example, of representatives of CAPIT, Benzina, Čepro, České rafinérské, OMV, Shell, Slovnaft, Unipetrol, and Mero.

NOSSOE has approximately 30 members in total. Except for in oil emergency situations, NOSSOE meets when needed, but at least once a year.

 

The Administration of State Material Reserves, specifically the Department for Oil Security, Methodology & Support, ensures educational (methodological) activities in the sphere of oil security. These activities focus, in particular, on the general issue of oil security in the Czech Republic, the international aspects of oil security, and the approaches to oil security in the EU, IEA and the North Atlantic Treaty Organization and on the crisis legislation relating to the emergency oil supplies, the planning documents on oil emergency, and the crisis readiness plans of crisis infrastructure entities.

 

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