All of Timor-Leste’s oil and gas revenue is deposited in the Petroleum Fund. Majority of the funds are invested abroad in financial assets. Of the total Petroleum Fund receipts of USD1,279 million in 2015, USD979 million was transferred to the State General Budget. The latest TL-EITI Report states that there was a USD321 million decrease in the Fund’s balance in 2015, which is the first annual decline since the Fund’s inception in 2005. The net investment loss of USD21 million contributed to the decline in the Fund’s balance for the year.

The 2015 TL-EITI Report notes that there are only two remaining recommendations that have not been implemented. These are the establishment of a database of all extractive companies operating in the oil sector and the enactment of an EITI Law.

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

The EITI process in Timor-Leste has been useful in disclosing the status of the Petroleum Fund and how it is transferred to the national budget. Timor Leste is considering moving towards mainstreaming of EITI data and has worked with the International Secretariat in conducting a feasibility study for mainstreaming. The  government maintains a Transparency Portal which links EITI implementation to wider transparency and accountability in the country. This includes a Budget Transparency Portal which gives oversight to budget expenditure. Up-to-date information on the legal framework, licensing, contracts, production, social expenditures and non-tax revenues is also available through the website of the ANPM. The Petroleum Fund website contains quarterly reports on revenues and the overall status of the fund, as well as annual reports that include budget allocations. Timor Gap’s website has information on the financial situation of the company as well as other activities. 

In accordance with the EITI Standard, Timor-Leste was suspended on 1 March 2017 for failing to publish the 2014 EITI Report by 31 December 2016. After the publication of the said report, the suspension was lifted on 29 June 2017.

In January 2017, Timor-Leste was found to have achieved meaningful progress in implementing the EITI Standard and the MSWG was given until 11 April 2017 to submit an action to plan to address the corrective actions relating to industry engagement and civil society engagement. On 14 February 2018, the EITI Board found that Timor-Leste addressed all corrective actions and has made satisfactory progress in implementing the 2016 EITI Standard.

View more information under the Validation section of this page or go to the Board's decision in full. Previously, the country was compliant under the 2011 Rules.

The MSWG published their 2018 work plan on 4 May 2018. The work plan contains the following objectives:

1. to implement the recommendation from the last Validation in enhancing EITI principles in Timor-Leste;
2. To ensure the publication of EITI Report in a timely manner and in accordance with EITI Standard 2016;
3. To encourage discussions on transparency in public expenditures, including investment decisions focus on economic diversification;
4. To encourage discussions on legal framework and maintain contract transparency within extractive industries and other revenues generated in Timor-Leste; and
5. To enhance EITI institutional development include capacity building for MSWG and National Secretariat members

Governance

The Ministry of Petroleum and Mineral Resources oversees EITI implementation in Timor-Leste. Currently, the MSWG is composed of seven civil society representatives, four industry representatives, seven government representatives and two representatives of state-owned enterprises. A list of MSWG members is available in the 2017 annual progress report of Timor-Leste EITI. Minutes of all MSWG meetings since 2007 are available from the TL-EITI website. No changes in law were needed for EITI to take place in Timor-Leste, nor were special Memoranda of Understanding between stakeholders required for this purpose. Nevertheless, the MSWG recommends enacting an EITI law.

Timeline

Timor-Leste was found to have made satisfactory progress in meeting the EITI Standard on 14 February 2018. The country was previously found to have made meaningful progress on 11 January 2017 during the First Validation. Timor-Leste took corrective actions on a number of requirements and achieved satisfactory progress during the Second Validation.

Timor-Leste's progress by requirement can be found in the scorecards below.