Guidance note 15 on infrastructure provisions and barter arrangements
Related to requirement 4.3 (2016 Standard) / requirement 4.1.d (2013 Standard)
|Please note that this guidance refers to the 2013 Standard. In most cases, the requirements remain the same and the guidance valid. An updated version reflecting the 2016 Standard will follow soon.|
The exploration, extraction, transformation, and transport of oil, gas and mineral resources often requires large scale and long-term investments. In addition to the capital needed to develop these resources, countries often have other priorities for infrastructure development. In some cases, resource rich countries with limited access to capital and credit are considering “package deals” to develop their infrastructure in exchange for their natural resources. The resources involved may include exploration or production rights for oil, gas, and minerals, and other elements such as access to land, energy and water resources. The infrastructure projects may include railways, roads, ports, power plants, schools and hospitals. These agreements are interchangeably called: “infrastructure provisions”, “barter agreements”, “minerals for infrastructure”.
In the EITI Standard, these deals are addressed in section 4.1(d) as “infrastructure provisions and barter arrangements”. Such agreements may be a means of a government accelerating its infrastructure-related development needs; conversely the value transfers inherent in such agreements, which may be governed by government-to-government agreements and involve complex supporting agreements involving a number of SOEs or private sector entities, may be opaque and difficult to track. Moreover, the value at stake may in some countries amount to a significant proportion of the total ‘revenue’ flows accruing to government or of the mineral resources of the country.
Step 1 - Consider infrastructure provision and barter arragements in EITI scoping
Step 2 - Develop a more detailed understanding of the agreements
Step 3 - Establish the reporting procedures
Step 4 - establishing a mechanism for quality assurance of the disclosed information
3. Examples from the Sino-Congolese Cooperation Agreement (SCCA)
4. Further reading