Economy August 4, 2021 | 10:00 am

Dominican Gov. gets US$3.7M from natgas price insurance

Santo Domingo.- The Dominican Government, through the Ministry of Finance, received US$3.7 million as compensation for the insurance nsation for the insurance (“call option”) contracted to set a cap on the price of Natural Gas. The cost of insurance for the coverage contracted in 2021 was US$2.5 billion.

The amount in excess of the cost, amounting to US$1.3 billion, will allow the State to cover part of the deficit in the electricity sector without affecting public finances.

Additionally, it guarantees that, if the upward trend of this fuel continues, the Government will have an income that will offset the total cost of any increase above the price ceiling set for the remainder of the year.

The Minister of Finance, Jochi Vicente, recalled that the acquisition of this insurance in April of this year allowed setting a ceiling on the purchase price of Natural Gas for electricity generation at US $ 3.25 per MMBtu (based on the Henry Hub index, the reference of the country).

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