US seeks reports on resource acquisition

Monday, 19 July 2010
Sebastian Strangio
The Phnom Penh Post

A SWEEPING financial reform bill passed by the United States Senate last week will force US-listed oil, gas and mining companies to publicly divulge payments made to secure access to resources in foreign countries including Cambodia.

The provisions, passed on Thursday as part of the 2,300-page Dodd-Frank Wall Street Reform and Consumer Protection Act, will require the companies to disclose the payments to the US securities and exchange commission by 2012.

Companies will be obliged to report to the SEC the “type and total amount of such payments made for each project”, as well as “the type and total amount of such payments made to each government”.

These include “taxes, royalties, fees (including licence fees), production entitlements, bonuses, and other material benefits” relating to extractive industry revenues.

Cambodia is home to some publicly traded resource companies – including Chevron, Total, Petronas, Conoco-Phillips and Mitsui & Company Ltd – that would be required to publicise further payments made to secure oil-exploration rights or offshore oil concessions in the Kingdom under the newly passed legislation.

In April, Prime Minister Hun Sen revealed that French oil giant Total had paid US$28 million to secure offshore oil exploration rights in the Gulf of Thailand, prompting requests for further disclosures.

In a statement on Friday, Oxfam America applauded the new regulations, saying they would improve the transparency of public revenues in Cambodia.

“Public disclosure of revenues and how they flow from industry to government is fundamental to improving governance, helping any government’s efforts to prevent and curb corruption, and improve revenue management,” Mona Laczo, Oxfam America’s deputy regional director for East Asia, said in the statement.

Ou Virak, president of the Cambodian Centre for Human Rights, also welcomed the new bill, saying the issue of under-the-table payments had long been a concern in the extractive resources industry.

“It is a good thing for the US to pass a bill that forces companies to disclose all unofficial fees,” he said. “I think it will be far-reaching.”

Council of Ministers spokesman Phay Siphan said he was not familiar with the new regulations, but reaffirmed the government would pursue resource revenue transparency “in the same spirit” as in its fight against corruption.

New US law seeks disclosure of foreign payments

Washington, July 17 (IANS) Publicly traded oil, gas and mining companies, including those from India and other emerging economies, will be required to disclose their payments to foreign governments under the landmark financial reform legislation.

The new law awaiting President Barack Obama’s signature will require companies to report on their filings with the Securities and Exchange Commission (SEC) such payments on a country-by-country and project-by-project basis, according to the Washington Times.

‘We now have the tools to help people in resource-rich countries hold their leaders accountable for the money made from their oil, gas and minerals,’ Benjamin L. Cardin, Maryland Democrat who co-introduced the measure in the senate was quoted as saying.

‘Too often, oil money intended for a nation’s poor ends up lining the pockets of the rich or is squandered on showcase projects instead of productive investments,’ Richard G. Lugar, top Republican on the Senate Foreign Relations Committee said in support.

The legislation should go a long way to ending the secrecy surrounding companies’ payments to foreign countries, its supporters contend.

The legislation applies to oil, gas and mining companies registered with the SEC and covers more than 90 percent of internationally operating oil companies and many of the top international mining companies, according to Oxfam America, an international nonprofit relief and development group that has been pushing for the law.

‘This not only includes American companies but also many foreign companies, such as Shell and BP, as well as companies from emerging markets such as China, India, Brazil, and Russia,’ the Times cited Oxfam officials as saying.

The measure would not apply to a number of large nationally owned oil companies, most of which operate only in their own countries and not internationally.

Oxfam and others praised Congress for passing the legislation.

‘Secrecy of oil, gas and mining company payments to governments fosters government corruption and violent conflict in resource-rich countries that are home to more than half of the world’s poorest people,’ Oxfam America President Raymond C. Offenheiser Jr. was quoted as saying.

‘Instability in these regions poses a long-term threat to national security, foreign policy, and economic interests in the United States.’

US registered oil companies will have to disclose amount paid to Hun Xen's regime?

US Energy Act Could Help Cambodia

By Im Sothearith, VOA Khmer
Original report from Washington
25 September 2009

Cambodia could benefit from a new energy security act, introduced to the Senate this week.

The “Energy Security Through Transparency Act” proposes changes to the Securities and Exchange Commission to stabilize energy sources and require energy extractive companies registered in the US to disclose the amount of money they pay to foreign countries and the US government for oil, gas and minerals.

Cambodia is on the cusp of offshore oil exploration, but critics warn an “oil curse” could put the money from the resource into the pockets of corrupt officials.

The transparency bill was introduced by Sen. Richard Lugar, a Republican from Indiana, among others.

Nilmini Rubin, a staff member for international economics and development for the Senate Foreign Relations Committee, told VOA Khmer that Lugar was passionate on energy security and fighting corruption. The bill was prepared after examination of more than 15 countries, including Cambodia, and a report, “The Petroleum and Poverty Paradox.”

Lugar sent staff to countries “to look at the impact of the resource curse and to think of how the US government, with the international partners, whether either bilateral countries, or the IMF or the World Bank, or multilateral agencies, what could we do to fight the resource curse,” Rubin said at a conference on the extractive industries in Washington. “The report outlines a number of suggestions. I think the key ideas percolated up into this legislation.”

Ian Gary, a senior policy adviser on extractive industries for Oxfam America, told VOA Khmer at the conference the legislation could benefit countries around the world.

“This legislation would require any company that registers in the US to publish their payment to the governments around the world where they operate,” Gary said. “And this would be mandatory. It does not depend on the political will of a country to agree to disclosing information.”

Lim Solin, East Asia program manager for Oxfam America, said she was optimistic the bill, if passed, would benefit Cambodia.

“The trickledown effect of the adoption of this bill will be enormous, actually, for a country like Cambodia, because once the bill is adopted, simply all the companies that are listed in the US stock exchange will have to disclose all the information related to contracts and payment,” Lim said. “And that will be a great turning point in the history for the area of transparency. And I believe that the more Cambodia becomes transparent, the more competitive she will be.”