EITI Report invigorates oil and gas sector governance

Further reforms underway as Trinidad & Tobago’s presents second report.

“When you scrutinize the report, it gives a clear idea of who is paying what taxes. In the past, we never had that level of granularity around our taxes” stated Trinidad and Tobago’s Energy and Energy Affairs Minister, Kevin Ramnarine. On 30September, Trinidad and Tobago published its 2012 EITI Report. The report independently reconciles taxes and other payments made by oil and gas companies with government disclosures on revenues received. The Report also provides a wide array of information about the management and outlook for the sector.

Trinidad and Tobago is one of 48 countries around the world implementing the EITI global transparency standard for the oil, gas and mining sectors. In 2012, upstream oil and gas companies paid US $3.2 billion to the government  – a slight decrease from US $3.6 billion paid in 2011. BG group was the single largest contributor to government revenue with US $ 1.3 billion.

Reporting process is stimulating change

Besides publishing revenue figures, the reporting process is supporting reforms in the oil and gas sector. An important aspect of the sector’s governance is determining the price for the oil and gas sold between government entities. The EITI reporting process has led to the reestablishment of the Petroleum Pricing Committee, which advises the Minister on these transfer prices. Transfer prices play a critical role in determining the allocation of profits between related entities.

Furthermore, the process has led to better coordination by government agencies, such as the Office of the Auditor General, which is charged with the review and audit of government’s revenue accounts. For the next reporting period, this Office will be even more closely involved in the reporting process, particularly in the monitoring of revenues from the oil and gas sector.

The Report also identifies a number of opportunities for further strengthening governance of the sector. The Report recommends that the government automates its revenue management systems. It also proposes that more attention is paid to the reconciliation of transfers between government revenue collection agencies in the forthcoming reporting period.

Moving to the next level

This Report will form the basis for a forthcoming review of whether the country is compliant with the EITI Requirements. In August, the Board requested corrective actions in response to the country’s validation report. The EITI Board will review progress in addressing the corrective actions in early 2015.

The Chair of the TTEITI multi-stakeholder group, Mr. Victor Hart, spoke of expanding the scope of reporting in 2015. He noted that “future reports will be even more useful because stakeholders will be familiar with the process and the reporting net will be widened to include data on the mining sector, such as asphalt and quarrying, in addition to the oil and gas sectors”.

Melanie Richards, National Coordinator of TTEITI Secretariat, stated that the first TTEITI Report had set the bar high in terms of data accessibility, with its extensive use of infographics and its user-friendly language. A reader-friendly summary of this second Report is underway. She noted that “we are working to make this EITI report as user-friendly as the first, including making it available as a mobile app and in Excel format on the website”. In its bid to encourage greater use of the rich information, the multi-stakeholder group has also developed a Youth Advisory Committee, which targets university students and faculties for interacting with EITI data.

 

For further information about the EITI Trinidad & Tobago, please visit the country page on the EITI website and the national EITI website.