Albania

EITI Status Yet to be assessed against the 2016 Standard
EITI Member Since 2013
Latest Data From 2014
Website EITI Albania

Overview

Rich in nature and natural resources, Albania is using the EITI to modernise governance of the extractive industries. The energy sector contributes 7% of GDP, and Albania recently expanded the EITI to cover the hydropower sector. The extractive sector was previously dominated by state-owned enterprises, but was opened up to private investment in 1994. The Albanian government is working to promote investment to stimulate development and job creation.

The petroleum industry has two main systems for awarding contracts: competitive bidding and ad hoc negotiations. The Ministry of Energy and Industry (MEI) grants mining licenses and hydropower concessions. The state-owned enterprise, Albpetrol, may sub-contract its exploration and production rights to oil and gas companies through petroleum agreements, approved by MEI.

With the extensive disclosures through our EITI process, we now have a critical mass of information about our energy sector. The sector's economic importance is evident and it is becoming increasingly politically important. You see proof of this throughout the government’s agenda.
Dorina Çinari, EITI Albania’s National Coordinator

Production

Production of crude oil has more than doubled since 2003. In 2014, crude oil production reached 1.3 million tons. The biggest operating oilfield is Patos-Marinza, which represents 87% of total crude oil production. Crude oil is mainly exported to Italy, Spain and Malta.

In November 2015, the Ministry reported 600 mining licenses, of which 112 related to extracting chromium ore in Bulqiza. Mining production was estimated at USD 175.5 million in 2014. China is the major buyer of the Albanian chromium and copper ore.

Natural resources

Source: Albania’s 2013-2014 EITI Report.

CommodityReservesUnitSignificance
Oil437.6Million tons
Gas18,164Million Nm3
Chromium10Million tons
Copper50Million tons
Nickel300Million tons
Hydro power10,000GWhAnnual potential capacity of hydropower production

Initializing chart.

Initializing chart.

Revenue collection

A share of oil and bonuses are collected by the state-owned enterprises, Albpetrol and AKBN, whereas a royalty tax, profit tax, dividends and other payments are collected by the government. The government’s income from extractive industries and hydropower sector amounted at USD 120.4 million in 2014. The government’s share of oil production was 94304 tons in 2014, worth USD 37.3 million.

Initializing chart.

Initializing chart.

Revenue allocation

25% of royalties are allocated to local governments in proportion to their contribution, within the terms of the annual budget law. According to the recent EITI Report, these transfers amounted to USD 1.1 million in 2014.

Innovations

​The EITI encourages multi-stakeholder groups to explore innovative approaches to make the EITI more relevant and useful.

  • Hydropower is included in EITI reporting.
  • EITI disclosure mandatory in Mining Code.
  • EITI Club of Journalists, a platform for journalists interested in extractives issues, offered by the national EITI secretariat.

Implementation

Governance

There is legislation (Law 10304) obliging mining companies to implement the EITI. The Presidential Order No. 71 dated 21 July 2011 establishes the EITI structures and process. On 12 March 2015, the Kuvendi, the Albanian Parliament amended the hydrocarbon law (7746 from 28 July 1993) requiring oil companies to participate in the EITI.

Timeline

Albania is using the EITI process for wider reforms in the sector, including the development of a revenue management plan to address informality in the mining sector and building its capacity in contracts.

 

 

Validation

Albania’s Validation against the Standard will commence on 1 April 2017. The country is compliant under the 2011 Rules.