EITI board approves US application for candidacy

The Extractive Industries Transparency Initiative (EITI) board approved the United States’ application for candidacy in the international organization, US Interior Sec. Sally Jewell announced. The action came during the board’s Mar. 18-19 meeting in Oslo.

Jewell said the US is the first G8 nation to achieve candidate status and become an EITI implementing country, joining a group of 41 nations worldwide that are working to improve the management of their oil, gas, and mining sectors.

“This achievement marks another significant milestone on the road to US EITI implementation,” Jewell said. “In addition to global leadership by example, our goal in pursuing US EITI implementation complements the Obama administration’s commitment to reforming and modernizing management of domestic natural resources overseen by the US Department of the Interior.”

Under EITI, participating governments work with company and civil society representatives to produce reports that help citizens understand how the government manages extractive industries working in the country.

Reports include parallel public disclosures, by both the government and companies, of payments that companies have made to the government on their oil, gas, and mining developments. In addition to increased transparency, EITI strengthens accountability and empowers citizens by enhancing the accessibility of information available about the revenues generated from natural resource development, DOI said.

It described EITI as a voluntary, global effort designed to increase transparency, strengthen the accountability of natural resource revenue reporting, and build public trust for the governance of these vital activities.

API, others respond

An American Petroleum Institute official welcomed the news. “The oil and gas industry has worked with civil society groups and governments for over a decade through EITI to promote payment transparency in various countries,” said Stephen Comstock, who directs API’s Tax & Accounting Policy Department.

“Expanding this effort to the United States will hopefully provide US citizens with a new perspective of the significant revenue and economic impact generated from US exploration and production,” he told OGJ in a Mar. 19 e-mail message.

Danielle Brian, executive director of the Project on Government Oversight, said the EITI board’s decision capped a 3-year application process spearheaded by Interior and a federal advisory committee of industry, government, and civil society representatives.

“EITI is a perfect example of open government principles in action,” said Brian, who chaired the committee's civil society sector. “I’m proud of what US EITI has achieved so far, and I think that the work we’ve done will ultimately enrich public policy discourse.”

Isabel Munilla, senior advisor for extractive industry at Oxfam America, also applauded the announcement. “[Interior’s] support of strong rules in Section 1504 of the Dodd-Frank Financial Reform and Consumer Protection Act as well as a robust US EITI process shows that the US government sees these initiatives as complementary,” she said on Mar. 19.

“We were very pleased that API members have endorsed the new EITI standard of full, company-by-company, project level reporting, which is what we expect to see from the new [US Securities and Exchange Commission] rules for Section 1504,” Munilla told OGJ by e-mail on Mar. 19.

Contact Nick Snow at nicks@pennwell.com.

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