This paper is a review of EITI reporting practices in implementing countries, investigating the level of disaggregation of data on company payments and government revenues in EITI Reports. It reviews to what extent EITI Reports contain revenue data that is disaggregated by project and what types of definitions of project are being used for EITI reporting purposes.
The paper was originally issued as Board paper for the 37th Board meeting in May 2017 in Oslo, Norway and is now made available to the public.
Disaggregation by project is required by EITI Requirement 4.7.
Following the 36th Board meeting in Bogota, the International Secretariat has completed a review of current reporting practices of EITI implementing countries. Three of 45 EITI implementing countries seem to fully disaggregate data by project, namely Indonesia, Philippines and Trinidad and Tobago. This has been achieved by disaggregating payments and revenues by individual Product Sharing Contracts/Agreements (PSCs/PSAs), which give rise to payment liabilities, consistent with the EU’s approach to project-level reporting.
An additional 25 countries, or 56% of all implementing countries, are deemed to partially report by project meaning that their EITI Reports were disaggregated by project for some projects or for some revenue streams. Three of these countries included an explicit definition of the term ‘project’ in their EITI Report, but disclosures by project were nonetheless only provided for some sectors, companies or revenue streams. The remaining 17 countries could not be deemed to report by project.
This review identifies some of the key issues to consider in project-level disclosures. Legal frameworks are important for defining projects in various countries; whether by licenses, contracts or other legal agreements. Fiscal regimes and how payment liabilities are levied are important for identifying which revenues are applicable for project-level disaggregation, and to precisely identify which companies are effectuating the different payments. This is especially relevant in contractual arrangements involving several parties. We conclude that project-level disclosures could make EITI reporting easier, as it will streamline EITI reporting with existing monitoring, recording and reporting practices of governments and companies, complementing new areas of implementation such as mainstreaming.