Government decides to re-tender gas service and rules out contract renewal with Naturgy in RJ
The government of Rio de Janeiro has decided to re-tender gas service, rejecting a contract renewal with Naturgy, the current concessionaire, which was set to expire in July 2027.
The Rio de Janeiro government has taken the notable step of deciding to re-tender its gas services, effectively rejecting a proposal for a 30-year renewal from Naturgy, the current gas concessionaire. This contract is due to expire in July 2027, and the government had initially begun studies to determine whether renewing the contract would be more beneficial compared to opening up the bidding process to new competitors. However, the notion of renewing without a competitive process raised several concerns both politically and legally, prompting scrutiny from various oversight bodies.
In January, a technical body from the State Court of Auditors (TCE) advised against the renewal of the contract, emphasizing the importance of maintaining competitive practice in public service provisions. In the latest developments, the advisors of the TCE unanimously supported the technical opinion, leading to a decisive stance that the government should refrain from any contract renewals until further assessments can be evaluated through proper legal channels. This resolution signifies a commitment to transparency and competitiveness in the gas service sector, addressing public concerns about monopolistic practices.
The situation has also caught the attention of the State Assembly, reflecting growing political implications surrounding the decision. As stakeholders await the outcome of the tender process, this move may lay the groundwork for potential shifts in how gas services are managed in Rio de Janeiro and signal a turn towards increased regulation and opportunity for new entrants in the market.