Oil, Gas and Mining press releases

Peru's human rights laws lag behind its neighbors

jforres — 2011-04-04T18:26:15Z

Laws in Peru protecting indigenous peoples’ rights to participate in the decision-making process on oil, gas and mining projects are less advanced compared to those of neighboring countries, warned international humanitarian organization Oxfam America.

The Andean region, abundant in natural resources, is home to a large number of indigenous and tribal communities. These communities often receive little prior notice or consultation before their land is invaded to feed the world’s appetite for oil, gold and other minerals. A new report released today by the Due Process Law Foundation, with support from Oxfam America, analyzes the effectiveness of international human rights laws coupled with prior consultation laws in Bolivia, Colombia, Ecuador and Peru.

“Persistent poverty is as abundant as natural resources in these areas. While the extraction of these resources could play a role in the socioeconomic development of these territories, transnational companies instead move in and out with little notice, generating violent conflicts and threatening the rights and livelihoods of local communities instead,” said Rocio Avila, officer with Oxfam America’s oil, gas and mining program.

According to the findings outlined in The Right of Indigenous Peoples to Prior Consultation, Bolivia and Ecuador’s recent constitutions broadly incorporate the rights of indigenous people and Colombia has developed extensive jurisprudence on the subject. The Peruvian government however, has not made domestic laws consistent with international standards. Following the Bagua incident in 2009 when 33 people died, Peru’s national congress passed a prior consultation law, but the executive branch didn’t approve it.

“Nearly half of social conflicts in Peru stem from the lack of prior consultation, yet the government has not adopted an adequate law to require consultation,” said Emily Greenspan, Oxfam America’s policy advisor. “It’s time for the Peruvian government to pass stronger laws in order to diffuse tensions and protect the rights of local communities.”

The report recommends that Peru’s government incorporate consultation rights in its constitution and restore dialogues between the government and indigenous peoples.

Aid group calls on US to support human rights and effective development in El Salvador

jforres — 2011-04-04T19:27:53Z

International humanitarian organization Oxfam America called on President Obama today to support the government of El Salvador in a trade dispute with a Canadian gold-mining company attempting to set up operations in the country. Mining-related conflicts in the northern part of the country have led to a wave of recent violence and death threats.

The call to action comes as President Obama travels to El Salvador today where he is expected to discuss a range of issues, including last year’s landmark announcement of a US Global Development Policy.

Canadian company Pacific Rim is suing the government of El Salvador for $77 million under the Central America Free Trade Agreement (CAFTA), arguing that the government’s denial in 2009 of an environmental permit violates its rights as a foreign investor. The Salvadoran government has instituted a de facto moratorium on mining since then, in part due to concerns about the environmental impacts of mining on the country’s agricultural production. As a party to CAFTA, the US government has the right to intervene in the dispute.

“The Salvadoran government has recognized that not all foreign investment is good for the country,” said Raymond C. Offenheiser, president of Oxfam America. “The Obama administration should help ensure that El Salvador’s development strategy is in the best interest of the people and protects human rights and the environment.

El Salvador’s government is right to acknowledge the people’s legitimate concerns about mining projects, and exercise its right to say ‘no‘ to mining within its borders,” said Keith Slack, manager of Oxfam America's oil and mining program.

Continued action by the US government through such proposed strategies as President Obama’s Partnerships for Growth—a key outcome of the US Global Development Policy that calls for a more coordinated US approach with countries that have shown a strong commitment to good governance and sustainable development—will ensure Salvadorans the United States is committed to working with El Salvador on development issues. Oxfam America recommends the United States continue to provide assistance to country-led efforts, and support Salvadoran’s right to know and decide what development projects will benefit their country.

Global summit supports oil and mining revenue laws

jforres — 2011-03-04T16:22:34Z

Paris – As the Extractive Industries Transparency Initiative (EITI) global summit concluded in Paris, international humanitarian organization Oxfam welcomed commitments by France, Germany and the United Kingdom to make it mandatory for oil, gas and mining companies to publish their payments in resource-rich countries.

Governments, companies and civil society organizations convened to discuss the future of EITI, which was launched in 2003 to improve governance in resource-rich countries through a set of voluntary reporting requirements.

“The lack of transparency in accounting for the world’s riches has fueled corruption, disease, atrocious acts of violence and even civil wars,” said Ian Gary, senior policy manager of Oxfam America’s Extractive Industries program who attended the conference. “A voluntary approach to transparency may work in countries where there is strong political will, but mandatory reporting laws, such as the recently passed Dodd-Frank Act in the US, will arm citizens with information they need to hold their governments accountable, especially in countries unlikely to join EITI.”

At the summit, the French, UK and German governments committed to support a new European law matching the US Dodd-Frank Act, which was passed last summer as part of the financial reform package. The governments agreed that mandatory reporting requirements would complement not compete with the voluntary initiative.

“We expect to see quick and robust implementation of the US law by the Securities and Exchange Commission, as European regulators are watching this process and looking to harmonize their reporting requirements,” said Gary. “The US law already covers a large number of companies including those based in the United States, Europe, China, Brazil and South Africa and broader application of mandatory reporting will bring more companies under the requirement and reduce competitive fears, which we believe are overstated by many companies.”

There is growing support from the investment community for such requirements to help assess the political and reputational risks faced by some oil and mining companies.

“In the United States, asset managers and pension funds with over $1.2 trillion in assets under management have written to the SEC to express strong support for the robust implementation of the US law. These firms believe this information is important and material to make decisions,” said Gary.

“The new American law shows that country-by-country tax reporting is possible,” said Maylis Labusquiere, advocacy officer at Oxfam France who was also present at the conference. “Extending the requirement to other sectors, with disclosure of further information will be vital to fight illicit financial flows, tax avoidance and tax havens which rob governments of the resources to combat poverty.”

Notes to editors:
•    More than 1.5 billion people live on less than $2 a day in the more than 50 countries rich in natural resources.
•    Eleven countries have now been judged to have completed the minimum requirements of the EITI, publishing data regarding payments made by oil, gas and mining companies as well as government receipts. EITI implementation requires governments to sign up to the initiative. EITI is implemented at the national level by a multi-stakeholder working group comprised of government, company and civil society representatives. An international board makes decisions on country compliance and enforces the EITI rules. More rigorous disclosure requirements, including disaggregated, company-by-company reporting and disclosure of contracts are needed to further advance the EITI globally. The Central African Republic, the Kyrgyz Republic, Niger, Nigeria, Norway, and Yemen have joined Azerbaijan, Ghana, Liberia, Mongolia, and Timor-Leste as EITI Compliant countries.
•    A provision in the Dodd-Frank Wall Street Reform Act signed into law last year by United States President Obama requires all American and foreign companies registered with the U.S. Securities and Exchange Commission (SEC) to disclose payments they make, annually and at a project level in each country of operation. The SEC is expected to issue a final regulation this April. The law covers European companies such as Total, BP, Shell and 27 out of 30 top internationally operating oil and gas companies are covered by Dodd-Frank. The list of the covered companies can be found at the Publish What you Pay USA website along with a Q and A about the provisions of the law. All submissions can be found on the SEC website.

Letter of the law must be followed in transparency rule

jforres — 2011-02-23T14:42:38Z

International humanitarian organization Oxfam America called on the U.S. Securities and Exchange Commission (SEC) to quickly implement recently passed U.S. legislation designed to curb financial secrecy in the oil, gas and mining industry. The new law, a provision of last year’s Wall Street reform legislation package, requires companies filing reports with the SEC to disclose annually payments for each project involving the exploration and extraction of oil, gas and minerals in every country of operation.

"The United States is the first country to pass such a historic measure and now the SEC has to bring it to life,” said Raymond C. Offenheiser, president of Oxfam America. “By sticking to the letter of the law, the SEC can carry out Congress’s legal mandate to increase financial transparency in the oil, gas and mining industry, government accountability in resource-rich countries and information investors can use to determine their investment risks.”

In a 24-page public comment submitted to the SEC on Monday, Oxfam America welcomed most aspects of the SEC’s proposed rule issued last December for following the clear statutory language of the provision in the Dodd-Frank Financial Reform act, and also put forward specific recommendations for implementation of the law. If implemented as Congress intended, the rule would become a new global standard for mandatory disclosure of payment information. The move would complement but also surpass the Extractive Industries Transparency Initiative (EITI) –— a voluntary international disclosure scheme followed by some countries.

“More often than not, extractive industries contracts and revenues are kept secret, but this law will arm citizens with crucial information to hold their government accountable,” said Ian Gary, senior policy manager for Oxfam America's Extractive Industries program. “In addition, shareholders of these companies can use the information to assess the risks companies face.”

The American Petroleum Institute (API), Chevron, Exxon, Shell and other companies are fighting to gut the law through the SEC rule-making process. These companies have provided the SEC with comments and proposals that would have the combined effect of greatly weakening implementation. For example, API suggests the SEC keep payments reported confidential, arguing that disclosure of such information puts companies at a competitive disadvantage.

In fact, some companies such as Talisman Energy, Statoil, AngloGold Ashanti and Newmont Mining, already disclose payments in every country of operation and in some cases provide this information at a project level.

"The SEC must not give in to the wishes of companies that don’t want to follow the new law,” said Gary. “There is a global movement now for transparency of these payments, as France and the United Kingdom are pushing for European Union regulation that would mirror the U.S. law. Companies and investors recognizing the importance of transparency will win in the end, benefit from better community relations and more stability for their multi-billion dollar investments.”

Notes to the Editor:

As mandated by Congress, the SEC is expected to issue a final rule by April 15, 2011 following the deadline for public comments on March 2, 2011. Following are some highlights of the Oxfam America submission:

•    Oxfam America argues that the payment reporting should happen through filed Forms 10-K, 20-F, and 40-F already filed by U.S. and foreign companies. By requiring this information to be filed, the SEC “will significantly strengthen incentives for compliance”, according to the submission, as increased liability for misstatements only applies to statements made in documents “filed” with the SEC.

•    Oxfam America argues that a “project” definition should be based on payments made at the lease or license level. “The SEC should not – and, consistent with the statute, cannot – adopt a country-level definition of project”, as proposed by industry, said the Oxfam America submission.

•    In response to SEC questions on whether exemptions for some types of companies should apply, Oxfam America argues that “no such exemptions should appear in the final rule” and that such exemptions are contrary to the statutory language of the law and “would directly undermine the purposes” of the provision.

•    Finally, Oxfam America argues that the proposed rule not be anti-competitive. Most leading internationally operating oil companies will be covered and concerns “that companies will be forced to disclose sensitive information are exaggerated”. No commercial terms, proprietary technology, business models or contracts are required to be disclosed. Oxfam America argues that the payment information “will not create any undue competitive disadvantage, but will rather produce information central to efficient capital formation, government accountability and stable investment climates for foreign investors.”

Relief agency hails Obama's historic endorsement of indigenous people's rights

jlee — 2010-12-17T20:02:43Z

Washington, DC – International humanitarian agency Oxfam America praised President Obama’s endorsement of the United Nations Declaration on the Rights of Indigenous Peoples. Oxfam helps indigenous communities around the world to defend their rights to land, livelihoods and identity.

The United States is the last of the four countries that originally voted against the UN Declaration to reverse its position. By endorsing the Declaration, the US affirms to the world that indigenous peoples have the right to be free from discrimination and forced assimilation, and the right of self-determination.

“The rights of indigenous people are often overlooked, ignored and violated, particularly when it comes to large-scale oil, gas, and mining projects,” said Raymond C. Offenheiser, president of Oxfam America. “Today’s endorsement by President Obama will strengthen indigenous people’s rights to make decisions about how their land is used and to be free from discrimination.”

While large-scale resource projects may bring opportunity for citizens of the nations where the resources are being developed, many of the poorest and most vulnerable, in many cases indigenous communities, are often excluded from the benefits that might be generated by these activities.

The Declaration enshrines the right of indigenous peoples to Free Prior and Informed Consent (FPIC), the principle that local communities must be adequately informed about development projects in a timely manner and be given the opportunity to freely approve (or reject) a project prior to the commencement of its operations. In particular, the Declaration calls on states to consult with indigenous peoples through their representative institutions to secure their consent prior to approving projects that would affect their lands or territories and other resources. This would allow and encourage indigenous communities to fully participate in the decision making process around such projects.

“Violations of indigenous peoples' basic human rights, such as rights to land, resources and the environment, often lead to disastrous consequences for these communities,” said Offenheiser. “We are pleased to see the US government take this long-overdue step towards addressing this situation and look forward to seeing the US government promote the principles of the Declaration, including FPIC, in its engagement with international financial institutions and other governments.”

Big challenges remain for managing Ghana's oil future

jlee — 2010-12-13T14:35:42Z

Washington, DC – On Wednesday, December 15, Ghana will celebrate the start of oil production at the major offshore “Jubilee” field, kicking off an oil boom expected to bring billions of dollars into the country. As Ghana prepares to “turn on the tap” with an elaborate inauguration ceremony, international humanitarian organization Oxfam America urges the government to quickly address large gaps in the legal framework needed to make the most of the billions in government revenue Ghana will receive from the sector.

“The start of oil production represents an important opportunity for Ghana. However, we are concerned that three-and-a- half years after discovery of the Jubilee field, there is still no oil revenue management law in place and no independent regulator established for the sector. Ghana has an enviable recent track record of progress on fighting poverty and improving democratic accountability, but the sudden onset of oil wealth often comes at the expense of good governance and effective development. Ghana’s challenge as an ‘oil hot spot’ will be to manage this industry with transparent and accountable policies and practices, so the people of Ghana can truly benefit over the long term,” said Ian Gary, Oxfam America’s Senior Policy Manager for Extractive Industries and author of the Oxfam report, Ghana’s Big Test: Oil’s Challenge to Democratic Accountability.

By early 2011, estimates are that Ghana will be producing approximately 120,000 barrels of oil per day. The Jubilee field has 500 million barrels of proven reserves and a potential for over 1 billion barrels. The production rate is expected to supply more than $400 million to the government’s 2011 budget and around $1 billion per year into the country in the early years. Promising indications from adjacent exploration oil wells could mean even higher levels of production and reviews in the next few years.

The Ghanaian government must establish a legal framework that ensures transparent publication of oil payments received, open and competitive contract bidding and contract disclosure, and active monitoring and participation by civil society. While there have been some positive signs – Ghanaian President John Atta Mills promised disclosure of oil contracts in March 2009 and a petroleum revenue management bill tabled in the Ghanaian Parliament in July contained important transparency and safeguard provisions – with first oil right around the corner, the necessary laws and systems have not been put in place. Despite government commitments, oil contracts remain unavailable to the public.

“The Ghanaian Parliament is currently debating an oil revenue bill, and important provisions – such as a prohibition against using oil revenue as collateral for loans – have already been stripped out of the bill. A Petroleum Exploration and Production Bill, which had numerous weaknesses, has been shelved. Celebrations of first oil are clouded by the fact that the government has yet to establish an independent regulator since the Jubilee discovery was announced in 2007,” said Richard Hato-Kuevor, Oxfam America’s Extractive Industries Advocacy Officer in Accra, Ghana. “These oil laws involve national questions that require national consensus. There is simply too much at stake for Ghana to adopt inadequate laws to manage this massive industry.”

The removal of a ban on using future oil revenues as collateral for loans is particularly worrying. Many oil producers around the world – such as Nigeria, Angola and Congo-Brazzaville – have gone deep into debt due to unsustainable oil-backed borrowing. Such loans, with steep interest rates and short repayment terms, are often taken out in secret with little or no parliamentary or public scrutiny. Recent press reports have noted that the state oil company, the Ghana National Petroleum Corporation, is working with Deutsche Bank and other private banks to secure a $500 million loan. The terms and purpose of the loan are not clear.

Ghana is one of the most peaceful and relatively prosperous countries in West Africa but remains poor with the majority of Ghanaians living on less than $2 a day. While poverty needs are pressing, stabilization and savings funds must be established and funded to avoid the price shocks and wasteful spending in the early years of an oil boom, which have bedeviled other countries.

Historically, the exploitation of natural resources in Africa has far too often led to increased poverty and conflict, a phenomenon often referred to as “resource curse.” In 2009, Africa produced 13 percent of the world’s oil with great investment and exploration throughout the continent, but this has yet to translate into tangible benefits for Africa’s poor. In fact, resource-rich countries in Africa have actually experienced lower growth rates than countries with scarce resources.

“Oil wealth threatens the growing democratic accountability that has been built in Ghana’s recent history,” said Mohammed Amin Adam, convener of Ghana’s Civil Society Platform on Oil and Gas. “This industry presents very real risks to Ghana’s fragile economy, including incurring too much debt through oil-backed loans. We as Ghanaians need to see December 15th as a day to wake up to these challenges and hold our government accountable for the management of this enormous opportunity for the country.”

In March 2011, Oxfam will publish a “Readiness Report Card” analyzing Ghana’s efforts to prepare its oil boom.

Click here to download Ghana’s Big Test: Oil’s Challenge to Democratic Development (2009)

Publish What You Pay awarded Commitment to Development Award

mhart — 2010-11-29T16:03:10Z

On Wednesday, December 1, 2010, the Center for Global Development (CGD) and Foreign Policy magazine will present the global Publish What You Pay coalition with the 2010 Commitment to Development Award. The award gives special recognition to the US chapter of Publish What You Pay in recognition of the coalition’s role in the passage of a provision in the Dodd-Frank Wall Street Reform Act, which will require oil, gas, and mining companies disclose their payments to governments around the word. Coalition member and international humanitarian organization Oxfam America was instrumental in the passage of this provision.

“This award is a testament to the Publish What You Pay coalition’s tireless work to shed light on an industry that has been clouded by secrecy for decades – at the cost of development and peace in many resource-rich developing countries. This multi-year effort shows that advocacy groups working as part of a well-focused coalition can have significant and lasting policy impacts,” said Raymond C. Offenheiser, president of Oxfam America.

The Publish What You Pay coalition works around the globe to help citizens of resource-rich developing countries hold their governments accountable for the payment, receipt, and management of natural resource revenues. Oxfam America and fellow coalition members worked with Senate champions Ben Cardin and Richard Lugar on the provision, which requires all oil, gas, and mining companies registered with the US Securities and Exchange Commission (SEC) to disclose payments made governments of resource-rich countries where they operate.

“Oxfam America is honored to have been a part of Publish What You Pay’s successful campaign to help reduce the secrecy of oil, gas, and mining payments to governments, which fosters corruption and violent conflict in countries that are home to half of the world’s poorest people,” said Offenheiser.

The award will boost the efforts of Oxfam America and allies in the Publish What You Pay coalition to promote new international standards and rules for the public disclosure of natural resource information, including advocating for timely and comprehensive implementation of the US legislation by the SEC.

"The effectiveness of this law – both in the United States and as a global model – will be determined by the development of effective implementing regulations by the SEC in early 2011 and strict compliance by companies starting in 2012. Companies should heed the call for transparency so citizens of resource-rich countries can begin to use this information to hold their governments accountable for using revenues to address essential services like healthcare, education, and job creation," said Offenheiser.

Since 2003, the Commitment to Development Award has honored individuals and organizations that made a significant contributions to changing attitudes and policies toward the developing world. Oxfam’s Make Trade Fair Campaign received this honor in 2004.

For more information:
The Commitment to Development Award: http://www.cgdev.org/section/initiatives/_active/cdaward
Oxfam America’s work on oil, gas, and mining issues: www.oxfamamerica.org/rights-resources.
Publish What You Pay United States: http://www.pwypusa.org

Oxfam calls for community rights improvements as IFC reviews standards

jlee — 2010-10-07T15:06:32Z

WASHINGTON, DC – As the World Bank and International Monetary Fund annual meetings commence in Washington, DC this week, international humanitarian organization Oxfam America calls for improved policies to protect the rights of communities affected by International Finance Corporation (IFC) funded oil, gas, and mining projects.

This year, the IFC is reviewing its 2006 Performance Standards and Sustainability Policy, which aims to minimize the impact of all investment projects on the environment and surrounding communities. Among other improvements, Oxfam is calling for a policy of free, prior, and informed consent (FPIC) for all project-affected populations.

“Large-scale oil, gas, and mining projects bring significant environmental, social, and economic changes to surrounding communities,” said Raymond C. Offenheiser, president of Oxfam America. “These communities should have access to information at all project phases and meaningful decision-making power for all projects that will impact their lands and livelihoods. For indigenous peoples in particular, free, prior, and informed consent is a critical means of protecting lands and cultural identity.”

Oxfam and local partners have engaged with communities surrounding IFC-financed oil, gas, mining, and other large-scale projects over the last decade. In addition to community engagement through FPIC, Oxfam recommends improved transparency, which means publicly disclosing all oil, gas, and mining industry project contracts between countries and companies.

“It’s no secret that lack of transparency around these projects often leads to government corruption and internal conflict. With improved transparency standards, the IFC will foster accountability in nations where secrecy has undermined development, democracy, and human rights,” said Offenheiser.

Oxfam also recommends a comprehensive policy for publicly reporting positive and negative examples of how IFC-funded projects have contributed to development in surrounding communities. This type of reporting will demonstrate how the IFC is progressing toward its poverty reduction mandate, and is particularly important for oil, gas, and mining projects, which have significant negative impacts on communities and the environment.

In April 2010, the United States submitted comments on the IFC’s proposed changes to the Performance Standards and Sustainability Policy. Oxfam commends the US government for supporting comprehensive improvements that will benefit communities. However, these recommendations do not include FPIC.

“The US government must support the inclusion of FPIC in the IFC standards, particularly given that the State Department is currently reviewing the US position on the United Nations Declaration on the Rights of Indigenous Peoples. Supporting FPIC in both arenas will demonstrate the United States’ commitment to protecting the rights of vulnerable communities,” said Offenheiser.

New evidence supports suspension of Guatemalan mine

mhart — 2010-08-11T18:15:01Z

WASHINGTON, DC – International humanitarian organization Oxfam America cites three new independent studies as further evidence that Marlin gold mine in the San Marcos department of Guatemala should be suspended until community concerns are adequately addressed. The studies support the government’s recent announcement that it would suspend operations the mine, owned by the Canadian company Goldcorp, following environmental and human rights complaints.

“Together, these reports indicate that Marlin Mine has had serious social and environmental impacts on surrounding communities. It’s time for the government to take action to suspend mining operations to protect the health, safety, livelihoods, and most importantly, the rights of these communities,” said Raymond C. Offenheiser, president of Oxfam America.

On June 24, the government of Guatemala announced it would begin a process to suspend operations at Marlin Mine responding to a request from the Inter-American Commission for Human Rights on behalf of 18 communities citing water contamination and adverse health effects on members of the communities. The suspension is pending an investigation into these allegations by Guatemalan officials.

A report launched today by environmental research nonprofit E-Tech International raises concern about groundwater and surface water contamination around the mine. The report examined the accuracy of Marlin Mine’s Environmental and Social Impact Study, which claimed there would be no significant negative effects to water resources or aquatic life in the areas surrounding the mine. However, the E-tech report showed environmental impacts are already occurring, including increasing concentrations of arsenic and sulfate in groundwater, decreasing health of aquatic life, and potential contamination downstream of the tailings dam. The report calls for more water quality monitoring and improved communication of the results and their significance to local communities.

The 1997 mining law in Guatemala encouraged metal mine development and offered little protection of local land ownership. Marlin Mine was the first to open under the new law and the first to receive funding from the World Bank’s International Finance Corporation (partial owner of the mine until the load was repaid in 2006). Since the initial exploration phase of Marlin Mine, communities have lodged numerous complaints and protested against the mine.

“Marlin Mine was established – like so many mining projects in developing countries – without adequate consultation with the surrounding indigenous communities. Too often, these communities pay the price for the negative effects of mining, but rarely have a say in how the mining industry is developed or a fair share of the resulting profits,” said Offenheiser.

An additional study by Guatemala-based research organization Association for Social Research and Study, known by their Spanish acronym ASÍES, found Marlin Mine does not comply with national and international laws protecting indigenous peoples, including Convention 169 of the International Labor Organization, which grants communities the right to Free, Prior and Informed Consent (FPIC) regarding mining operations.

The analysis showed threats to communities in mining areas – including the contamination of natural resources, damage to health and livelihoods, and with non-compliance with national and international consultation laws – have instigated social conflict and rejection of mining operations. Even further, evidence suggests that social conflict generated by mining operations, especially Marlin Mine, is growing worse in Guatemala and could eventually impact governability in these regions leading to substantial social and economic costs.

In a separate report, ASÍES surveyed more than 700 people in communities surrounding mining activities. According to the findings, the majority of those interviewed:

are against mining in Guatemala;
believe that neither the government nor the mining companies respect the rights of communities on this issue;
identify the most important social cost of mining as the violation of the rights of indigenous peoples;
believe that mining companies do no respect the right of surrounding communities to be informed; and
view mining as incompatible with traditional means of livelihood, including agriculture and fishing.

“Time and time again, indigenous communities have spoken without being heard. Guatemala is not only facing irreparable land and water degradation in these areas – the country could face real challenges to peace and prosperity if the concerns of these communities are not addressed,” said Andres McKinley, program officer for Oxfam America’s extractive industries program in Central America. “The government must take a critical look at the benefits of mining in Guatemala versus the significant costs to communities that are eager to support their families and through traditional livelihoods like fishing and agriculture.”

Download the three reports:

Evaluation of Predicted and Actual Water Quality Conditions at the Marlin Mine, Guatemala by E-Tech International

Executive summary of ASÍES report Cost-Benefit Study of the Marlin Mine in San Marcos, Guatemala (English)

Executive summary of ASÍES report Public Opinion Survey on Metals Mining in Guatemala (English)

Full versions of both ASÍES reports (in Spanish) can be found here.

Congress passes law to end secrecy in oil, gas, and mining industry

mhart — 2010-07-15T19:16:23Z

Washington, DC - International humanitarian organization Oxfam America commends the US Congress for making disclosure of payments from oil and mining companies to governments around the world a legal requirement. Included as part of the Dodd-Frank financial reform legislation passed by the House and Senate, this historic measure will increase financial transparency in the oil, gas, and mining industry and help reduce the corruption, mismanagement, and conflict that are too often associated with natural resource extraction booms.

"Congress has made an unprecedented commitment to financial transparency and good governance in a sector that not only affects American wallets, but also some of the most vulnerable communities around the world," said Raymond C. Offenheiser, president of Oxfam America. "Secrecy of oil, gas and mining company payments to governments fosters government corruption and violent conflict in resource-rich countries that are home to more than half of the world's poorest people. Instability in these regions poses a long-term threat to national security, foreign policy, and economic interests in the United States."

The language included in financial services reform measure was based on the Energy Security through Transparency Act (S. 1700), a bipartisan Senate bill championed by Senators Lugar (R-IN) and Cardin (D-MD). The new law creates a low-cost, uniform transparency method for oil, gas, and mining companies registered with the US Securities and Exchange Commission (SEC) and covers more than 90 percent of internationally operating oil companies and many of the top international mining companies. Companies will be required to publicly disclose payments for the extraction of oil, gas, and minerals on a country-by-country and project basis as part of financial statements that are already required by the SEC. This not only includes American companies but also many foreign companies, such as Shell and BP, as well as companies from emerging markets such as China, India, Brazil, and Russia.

"This provision is a critical part of the increased transparency and corporate responsibility that we are striving to achieve in the financial industry. Given the catastrophic events in the Gulf of Mexico, oil companies, in particular, should well understand that secrecy fosters instability, corruption and greater risk," said Senator Cardin. "We now have the tools to help people in resource-rich countries hold their leaders accountable for the money made from their oil, gas and minerals."

"Too often, oil money intended for a nation's poor ends up lining the pockets of the rich or is squandered on showcase projects instead of productive investments," said Senator Lugar when he spoke in favor of the measure when it was offered as an amendment to the Senate financial reform bill in late May. (The Cardin-Lugar amendment was co-sponsored by Senators Durbin (D-IL), Schumer (D-NY), Feingold (D-WI), Merkley (D-OR), and Johnson (D-SD).) He added: "This 'resource curse' affects us as well as producing countries. It exacerbates global poverty which can be a seedbed for terrorism, it empowers autocrats and dictators, and it can crimp world petroleum supplies by breeding instability."

"We applaud Senators Cardin and Lugar for spearheading this effort in the Senate that will both level the playing field for oil, gas, and mining companies and help citizens hold their governments accountable for using revenues for economic development and poverty reduction. We also thank Senator Leahy for offering the measure during the House-Senate conference process and House Financial Services Chairman Barney Frank for his early leadership on transparency in the oil and mining industries and for his support for this measure that demonstrates US commitment to transparent business practices and accountable governance," said Offenheiser.

"Passing this law sets up an international standard for the public disclosure of natural resource revenue information, but its effectiveness will be determined by strict implementation by lawmakers and development of effective implementing regulations by the SEC. Companies should heed the call for transparency so citizens of resource-rich countries can begin to use this information to hold their governments accountable for using revenues to address essential services like healthcare, education, and job creation."

Oxfam America calls on the SEC to quickly undertake its rule-making process to implement this important measure as Congress intended. "Oxfam America and its allies in the Publish What You Pay campaign will be closely following the rule-making process to ensure this groundbreaking disclosure measure is quickly put in place," said Offenheiser.

Can Peru overcome the ‘resource curse’?

mhart — 2010-06-15T22:16:44Z

WASHINGTON, DC – International financial institutions can improve their role in Peru’s oil and gas sector by supporting local governments to better use resource revenues for addressing the persistent poverty facing their citizens, says international humanitarian organization Oxfam America. A research report published today examines the Camisea natural gas project in southeastern Peru and the role of local governments as well as international financial institutions (IFIs) in harnessing the potential of this massive project.

The Camisea project is the largest producer of hydrocarbons in Peru. Between 2004 and 2009, approximately $1.13 billion in revenue generated by the project was transferred to local governments in the surrounding area. However, the report finds that many local governments were largely unprepared for the Camisea revenue windfall and IFIs did not adequately support these governments in parallel with their support for the project. More than five years after the start of operations, the basic needs local citizens have not been met.

“Too often, we have seen communities suffer the consequences of oil, gas, and mining operations without experiencing the rewards,” said Raymond C. Offenheiser, president of Oxfam America. “Peru has an opportunity to reverse this so-called ‘resource curse’ by ensuring transparent and accountable management of the natural gas industry.”

People, Power and Pipelines: Lessons from Peru in the governance of gas production revenues – a research collaboration between World Resources Institute, Oxfam America, and Bank Information Center – examines oil and mining development in Peru, focusing on the use of revenues generated by the Camisea project. Most recently, Peru has experienced unprecedented economic growth with support from hydrocarbon and mineral extraction. However, as of 2008, close to 60 percent of the rural population remained in poverty, including areas where natural resources are extracted. Citizens in these regions are often left without basic services, including electricity, water, and sanitation services.

In 2002, Peru’s national government launched a decentralization process, establishing regional governments and delegating more authority and resources to local governments for improving the delivery of basic services to citizens. Local governments have made progress in effectively managing natural resource revenues and providing public access to revenue information, but they still fall short of what is required by Peruvian law and of what is necessary to enable citizens to hold their local officials accountable.

“Local governments must ensure that revenues support local development and translate to tangible benefits for local communities like health, education, and jobs. Providing citizens with information is the best way to hold these governments accountable for using revenues to provide basic services that are critical to the pathway out of poverty,” said Offenheiser.

As donors, the collection of IFIs supporting Peru’s natural resource sector have a crucial role to play in helping local governments strengthen their strategic planning processes, transparency and accountability practices, and their ability to evaluate their progress. The report provides recommendations for IFIs to improve these areas using several tools, including loans for improved fiscal management, loans for energy sector development, and project-based investment loans like those granted to the Camisea project.

“As natural gas flows out of Peru, the international community must support a transparent flow of resources and information. Donors must support local governments in using these resources to foster a sustainable, vital industry in Peru that benefits local communities and contributes to the long-term reduction of poverty,” says Offenheiser.

Click here to download the full report.

Chevron shareholders cast their votes for transparency

jlee — 2010-06-01T15:18:02Z

WASHINGTON, DC – According to preliminary results from yesterday’s Chevron annual meeting in Houston, shareholders representing approximately 160 million shares – worth more than $10 billion – voted in favor of a shareholder proposal calling for a transparent payment disclosure policy, said international humanitarian organization Oxfam America.

“With this level of shareholder support, Chevron can no longer ignore the call for transparency,” said Ian Gary, senior policy manager for extractive industries at Oxfam America, who attended the shareholder meeting. “We know oil revenues are too often squandered through corruption, internal conflict, and weak governance. This is an opportunity for Chevron to promote the rights of citizens by providing them with vital information about revenues coming into their countries. Transparency should not be a question for Chevron, it is central to accountable practice in the vulnerable countries where it operates.”

The shareholder proposal was filed in December 2009 by Oxfam America and five institutions with Chevron holdings. Prior to the vote yesterday, shareholders and their proxies spoke in favor of this proposal to help reduce instability and insecurity in oil-rich countries through a transparent and accountable payment disclosure policy in all countries where Chevron operates. Two other global oil companies, Statoil of Norway and Talisman Energy of Canada, already disclose this information to the public.

During his remarks, Mam Sambath, chairman of Cambodians for Resource Revenue Transparency, said: “Secrecy encourages conflict. In Cambodia, over the past decades, there have been numerous conflicts between communities and companies, and these have led to losses for both sides. We don’t want this to happen because we want Chevron to stay, and this is your opportunity to take leadership in Cambodia and help us ensure that your operations in Cambodia will be successful and beneficial to both your company and Cambodians.”

In 2008, Chevron paid more than $40 billion in taxes to governments around the world. Managed properly, these revenues can contribute to economic prosperity and stability in countries where Chevron and other companies operate. However, history has shown that oil company payments to governments as well as government receipts are often kept secret, leading to embezzlement, corruption, and revenue misappropriation, which, in many cases, has prevented oil revenues from contributing to economic development.

In his address to shareholders, Ian Gary said: “Disclosing payments would complement Chevron’s existing efforts in initiatives such as the Extractive Industries Transparency Initiative. EITI has serious limitations. It is voluntary and only works where governments have the political will be transparent…Chevron works in many countries run by governments suspected of corruption and worse. Unfair or not, undisclosed payments raise popular suspicion regarding Chevron’s role in maintaining a system of financial secrecy. Ensuring that payments are transparent puts Chevron in a leadership position and turns the spotlight back on host governments.”

With the results of yesterday’s vote, Oxfam America has the right to re-file this shareholder proposal with Chevron next year. Oxfam America will continue to call on Chevron and its shareholders to support disclosure of all payments to host governments.

In midst of massive spill, oil industry fighting transparency and accountability

mhart — 2010-05-17T21:32:06Z

Washington, DC – In the midst of an unfolding environmental disaster in the Gulf of Mexico, the oil industry is supporting secrecy and business as usual on Capitol Hill by opposing a critical amendment to the financial reform bill. The bipartisan amendment would increase financial transparency in the oil, gas, and mining industries and provide valuable information to investors in the United States and to citizens in poor countries around the world, says international humanitarian organization Oxfam America. The amendment is likely to face a floor vote this week.

“The recent oil spill in the Gulf of Mexico reminds us of the potentially devastating impacts of oil, gas, and mining activities on the environment and nearby communities, especially in developing countries,” said Raymond C. Offenheiser, President of Oxfam America. “More transparency and stability in this sector could help protect these communities by increasing the accountability of oil, gas, and mining companies and governments of host countries where secrecy has undermined development, democracy, and human rights for decades.”

Amendment (4050) to the Restoring American Financial Stability Act (S. 3217) would require all oil, gas, and mining companies registered with the US Securities and Exchange Commission to report how much they pay governments for access to their natural resources. The amendment, introduced by Senator Cardin (D-MD) and supported by Senators Lugar (R-IN), Durbin (D-IL), Schumer (D-NY), Feingold (D-WI), Merkley (D-OR), and Johnson (D-SD), is based on a bipartisan bill introduced last September by Cardin and Lugar, the Energy Security through Transparency Act (S.1700).

“As the oil industry fights a public relations battle in the fallout of the oil spill, they are also fighting a political battle on Capitol Hill to ensure that much of their financial transactions around the world remain secret. For decades, we have seen the dangerous effects of secrecy on poor people in developing countries, including government corruption, violent conflict, and poverty. Instability in these regions poses a long-term threat to national security, foreign policy, and American jobs,” said Offenheiser.

The American Petroleum Institute sent a letter opposing the amendment to Senate Banking Chairman Dodd, Ranking Member Shelby, and other Senate offices last week. Oxfam, along with partners in the Publish What You Pay Coalition, strongly support the Cardin amendment, which would help prevent the misuse of revenues in a multi-trillion dollar industry, inform investors, and level the playing field for US companies by creating a low-cost, uniform transparency method for more than 90 percent of internationally operating oil companies.

“If passed, this amendment would help unlock billions of dollars in resource-rich countries that are home to more than half of the world’s poorest people. We commend the Senators for this effort and urge the Senate to stand with investors and poor people in resource-rich countries by approving this crucial amendment,” said Offenheiser.

US Helsinki commission examines human rights in resource-rich countries

jlee — 2010-04-30T18:20:33Z

Washington, DC – International humanitarian organization Oxfam America testified today before the Commission on Security and Cooperation in Europe, also known as the US Helsinki Commission, at a hearing entitled “The Link between Revenue Transparency and Human Rights.” The hearing focused on programs that support revenue transparency in the oil, gas, and mining industry and how these programs help address human rights issues in resource-rich countries.

Voluntary initiatives like the Extractive Industries Transparency Initiative (EITI) have emerged to increase transparent and accountable management of natural resource wealth. While these efforts are an important first step, transparency will not be effective without improved political accountability and the protection of basic human rights.

“Publishing numbers will only go so far if political accountability issues are not addressed. The US government and other countries supporting EITI implementation must develop accompanying strategies to improve human rights protection and oversight of government expenditures in these countries. Otherwise, transparency initiatives may have the perverse effect of masking these underlying problems,” said Ian Gary, senior policy manager at Oxfam America, who delivered the testimony.

“More than half of the world’s poorest people live in countries rich in natural resources. Despite billion dollar industries operating on their lands, many resource-rich countries exhibit classic signs of the ‘resource curse’ with high rates of underdevelopment, internal conflict, and political instability, all of which impinge on the rights of citizens. This hearing is a timely opportunity to assess the progress made in the last decade to improve human rights and development in these countries.”

For decades, these important issues were not part of the international development agenda. In the last several years, Oxfam and other nongovernmental organizations as well as civil society groups in developing countries have begun calling attention to the tragic irony of extreme poverty in countries with abundant natural resource wealth.

Secrecy in oil, gas, and mining industries has been identified as a major obstacle to reform. In many countries, contracts and payments between foreign companies and host governments are not made public, leaving citizens with little information about the revenues coming into their country.

“Without accurate, timely, and complete information about resource revenues, citizens have no power to hold their governments accountable for using this wealth for essential services like health and education. Transparency will help make way for stability and real solutions to poverty that the oil, gas, and mining industries can support improving the ability of these industries to address poverty,” said Gary.

In some countries, such as Ghana, EITI discloses new information and provides a platform for civil society and government engagement. But Ghana has a vibrant civil society with an active press and a generally favorable human rights environment. In countries like Equatorial Guinea – with a history of oil-fueled corruption, no free elections, independent media, or strong civil society – transparency of payments from companies to governments is important but needs to be accompanied by progress on human rights to be used as a tool for political accountability. Equatorial Guinea was dropped from EITI on April 15, 2010 after it was not granted an extension to complete a validation process to assess EITI implementation. EITI’s board did not find evidence that “exceptional and unforeseen” circumstances had prevented the country from making progress.

Given the uneven progress of voluntary initiatives to date, additional disclosure rules for oil, gas, and mining companies are needed. The US Congress, for example, should pass the Energy Security through Transparency Act (S.1700) this year to require all oil, gas, and mining companies to disclose payments to host countries and extend transparency as a truly global standard for company operations. The legislation, introduced in September 2009 by Senators Lugar and Cardin, would apply not only to US companies, but to all companies registered with the US Securities and Exchange Commission. This includes European companies, such as Shell and BP, as well as those in emerging markets like China, India, and Brazil.

In addition to this legislation, Oxfam suggested additional US government reforms during the testimony that would help address human rights violations in resource-rich countries, including the development of concrete strategies for human rights promotion and protection in resource-rich countries by the State Department; engagement of the State Department’s Bureau of Democracy, Human Rights, and Labor in the global EITI process; and increased US support for efforts by civil society, journalists, and others to disseminate payment information disclosed as a result of EITI.

“The US and other countries must recognize that more comprehensive strategies are needed for resource-rich states to truly overcome the ‘resource curse’ through human rights promotion, political accountability, and improved transparency in all areas. Only then can citizens truly begin to see the benefits of natural resource extraction,” said Gary.

Many countries failing test of political will to implement oil and mining industry anti-corruption initiative

jlee — 2010-03-08T21:22:14Z

Tuesday, March 9 marks the deadline for candidate countries to complete external “validation” of their implementation of the Extractive Industry Transparency Initiative (EITI), a voluntary initiative to increase transparent and accountable management of natural resource wealth. Of the 22 countries subject to the deadline, the fact that 20 have not completed validation will further test the credibility of the EITI process. While these countries are at various stages of implementation – some making laudable progress – many have shown a lack of political will to fully open their books on oil, gas, and mining payments in these countries, says international aid agency Oxfam.

With more than half of the world’s poorest people living in countries rich in natural resources, the problems associated with oil, gas, and mining booms – increased corruption, conflict, and environmental degradation – are pressing concerns for Oxfam and its partners around the world. Transparency of financial flows is an important condition needed to unlock billions of dollars in oil and mining revenues to help fight poverty.

“These industries generate billions of dollars per year in poor countries. The revenues amount to far more than official aid flows and could fund health, education, and other essential services, but are too often squandered or siphoned off by government officials,” said Raymond C. Offenheiser, president of Oxfam America. “The goal of EITI is to increase accountability and transparency in those countries where it is most needed. It’s disappointing that many countries haven’t yet cleared this hurdle, and it’s clear that other complementary measures focused on company and government disclosure are urgently needed.”

Only two countries – Liberia and Azerbaijan – met the deadline and were subsequently judged compliant by the EITI board. While several countries, such as Ghana, Nigeria, Mongolia, and Timor-Leste have completed draft validation reports, others, such as Mali, Mauritania, Niger, Equatorial Guinea, and Peru are further behind. According to EITI’s rules, countries that fail to meet the deadline will be “delisted” or dropped from EITI with the option to reapply for candidate status. Countries have been advised that they may apply for an extension if they provide evidence of “exceptional and unforeseen circumstances” outside the country’s control that prevented them from meeting the deadline.

“The validation deadline was an important test of political will for governments who say that they are implementing EITI. The EITI board must carry out a fair, transparent process for granting any possible extensions to ensure that the initiative maintains credibility. In addition, supporting countries such as Spain should more actively promote the implementation of EITI within their bilateral and multilateral relationships,” said Laura Ruiz Álvarez, extractive industries advocacy officer of Intermón – Oxfam Spain.

A lack of transparency in the oil, gas, and mining sectors – including secret payments, contracts, and opaque government budgets – is a major contributor to the problems in these countries. Oxfam affiliates and local partners around the world have pressed for greater disclosure of information on payments from companies to governments, contracts, and how revenues are spent.

Despite weak government capacity – as in many resource-rich countries – Liberia was able to be validated and achieve “compliant status” in 2009, proving that even very poor, post-conflict countries can meet the deadline when EITI is strongly supported and promoted at the highest levels of government. “For those governments truly interested in implementation, millions of dollars of technical assistance from donor governments are available. The board should not accept sluggish government implementation as sufficient reasons for extensions. If extensions are given, the board should explicitly disclose the reasons for the extension cited by the country in its request,” said Offenheiser.

Since October 2006, a strong governance structure has been in place for EITI, including a multi-stakeholder board including company, government, and civil society representatives as well as a clear process for implementation and validation. In 2008, the first 22 candidate countries were given the March 9, 2010 deadline to assess their progress as input into a board decision as to whether or not they are fully “compliant” with the rules of the initiative.

The EITI board will consider all extension requests received by the March 9 deadline at its meeting on April 15/16. Oxfam International believes that any extensions given should be based on the existing EITI rules and contain a hard deadline whereby a country failing to meet the new deadline would be automatically dropped from the initiative without any further board discussion.

Oxfam International has been supporting civil society partners – many part of the global Publish What You Pay coalition – in several EITI implementing countries who are working to ensure that their governments faithfully follow through on EITI commitments. In several EITI implementing countries, civil society activists promoting revenue transparency have faced harassment, criminal charges, and jail time merely for exercising their rights to freedom of expression as part of their anti-corruption campaigning. Unfettered and independent civil society participation at every step of the EITI process is non-negotiable. In addition, transparency is needed in other areas to ensure that citizens receive a fair deal from the development of extractive industries. This includes disclosure of contracts and easy access to government budget and expenditure information.

While the burden of implementation is on host governments, EITI does not require international oil and mining companies to act unless host governments decide to join the initiative. Given uneven EITI progress to date, additional disclosure rules for oil, gas and mining companies are needed.

One such measure, The Energy Security through Transparency Act (ESTT), is a bi-partisan piece of legislation introduced in the United States Senate in September 2009 by Senators Lugar and Cardin. This legislation would require all oil, gas, and mining companies to disclose payments to host countries and extend transparency as a truly global standard for company operations. The ESTT Act would apply not only to US companies, but to all companies registered with the US Securities and Exchange Commission. This includes European companies, such as Shell and BP, as well as those in emerging markets like China, India, and Brazil. In addition to the US passage of this law, other financial jurisdictions in Europe and elsewhere should pass similar legislation.

“Those countries that are the headquarters for the global mining industry including Australia, Canada, and the US should also lead by example by committing to become EITI countries themselves. They should also emphasize the importance of EITI implementation in their bilateral relations with resource-rich countries” said Serena Lillywhite of Oxfam Australia.

“The decisions made by the EITI board following this deadline are crucial for real progress in the global movement for oil, gas, and mining industry transparency. Faithful implementation of the EITI, complemented by other disclosure requirements, such as the Energy Security through Transparency Act, will create a new global standard for transparency and help citizens hold their governments accountable for directing revenues to essential services like health and education,” said Offenheiser.