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Fall in commodity prices worries oil companies
By Reporter
OIL companies in resource-rich nations are recognizing the power of investor trust and a focus on national development as their best tools for survival in the current financial downturn. "State-owned oil companies are a pivot-point in this crisis," said Karin Lissakers, director of Revenue Watch Institute USA. "They are realizing that transparency in revenue management and reporting has become an economic necessity." At a meeting during last week's global conference of the Extractive Industries Transparency Initiative (EITI) in Doha, Qatar, oil companies Exxon Mobil, BP and Total voiced anxiety about losing revenue in the downturn and setting aside regulatory reforms that could lead to long-term fiscal and national growth. "Without sound corporate governance and disclosure policies, companies will lose the trust of the investors and lending institutions they need to operate successfully," said Lissakers. "Open reporting practices can safeguard future windfalls against the volatility that is wreaking havoc today." The EITI is a coalition of governments, companies, civil society groups, investors and international organizations that supports improved governance in resource rich countries through the full publication and verification of company payments and government revenues from oil, gas and mining. Twenty-six countries are now in the EITI, and other resource-rich nations like Papua New Guinea are urged to use the momentum of the transparency movement to secure their prospects for long-term growth. Among the conference participants from government, civil society, academia, international agencies, international business leaders and company officials from EITI supporting, candidacy and compliant countries were 2 civil society representatives from the Centre for Environmental Research and Development Inc., a national NGO that advocates on issues that impact upon the lives of mine affected communities in Papua New Guinea. The attendance of Iraqi oil minister Hussain al-Shahristani at the EITI conference underscored the importance of adding a major Middle East oil producer to the initiative. Among the OECD countries Norway has signed up to the EITI and calls have been made to others such as UK and USA to also sign up. |
BUSINESS
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