OIL COMPANIES: Business transparency group critical of ExxonMobil

An anti-corruption group has rated more than 40 energy companies on the transparency of their dealings, handing a low grade to ExxonMobil but praising Shell and Petrobras. The Transparency International report published today places 42 oil and gas companies into three tiers based on their level of transparency in revenue disclosure.

The group used publicly available records to measure companies' payments to host governments, their operations and contributions to corporate anti-corruption programs.

Royal Dutch Shell PLC, Brazil's Petrobras, Norway's StatoilHydro ASA and PetroCanada were among the best performing companies. Irving-based ExxonMobil Corp., Russia's OAO Lukoil and the China National Offshore Oil Corp., known as CNOOC, fell into the lowest tier.

Companies were placed in the lowest tier for disclosing information only by geographical segments and providing almost no additional information.

"Information is crucial, it's fundamental for civil societies to request information on where the revenue from energy extraction is going to and coming from," said Juanita Olaya, who manages the program that came up with the report. "They need to disclose more on payments," Olaya said of ExxonMobil. She said the company was "taking important steps" in its anti-corruption program, but needed to do more.

ExxonMobil said it was working to establish transparency agreements with governments where it had significant investments, including Chad, Azerbaijan, Kazakhstan and Nigeria. The company said in a statement that it was "committed to honest and ethical behavior" and "constructively participates in transparency and anti-corruption programs."

BP PLC, Chevron Corp., ConocoPhilips, Eni SpA and Total SA were in the middle tier of companies that disclose revenue by geographic region and which the report said could improve by giving a country-by-country breakdown.

Companies placed in the highest tier disclose payments systematically on a country-by-country basis or in a few select countries and go beyond the mandatory reporting regulations.

"These top performers, which include some of the world's largest corporations, can act as role models for the industry as a whole," the report said. "The high level of transparency demonstrated by these companies proves that secrecy is both morally and commercially indefensible."

Transparency International said the report aimed to help fight the "resource curse" — oil can generate great wealth for a country, but if poorly managed can also discourage the development other areas of the economy, spur corruption and trigger conflict. The report said that if 10 percent of the estimated $866 billion generated worldwide in oil revenues in 2006 was set aside, it would have been enough to cover the total cost of meeting the United Nations' Millennium Development Goals. The cost of meeting the set of development standards on education, health, literacy and poverty was estimated at $73 billion in 2006, the report said.

Source: Associated Press

No comments: