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sharing in governance of extractive industries

Contract and Licensing Transparency in the Extractive Industry

Disclosure of contract and license in the extractive industry sector, especially in oil, gas and mining are mandatory. Firstly, they are important to trace the income flows from extractive industry sector, and also to secure social and environmental justice. Contract and licensing documents of extractive industry sector always involve public resources and become the basis of many public policies for its fiscal, social, and environmental aspects. So the public has the right to know and aware of the content of those documents. Secondly, the disclosure publicly contribute to the decreasing of corruption practices usually done by government and companies collusion.

Thirdly, contract and licensing documents have been published by many countries in the world, at least 29 countries of them, such as Colombia, Ghana, Guinea, Iraq, Liberia, Peru, Timor-Leste, Philippines and United States. Even extractive companies like Rio Tinto, British Petroleum, SOCAR, Amaco, Lukoil, Elf and Statoil, Tullow Oil, and Kosmos Energy did so. Supports for publicizing the documents also come from international institutions like World Bank Group’s International Finance Corporation (IFC), International Monetary Fund (IMF), and the International Bar Association.

Publish What You Pay Indonesia highlights the urgency of contract and licensing transparency in the extractive industries in Indonesia and suggest the following recommendations: 1) Include the provisions and mechanisms of contract and licensing documents publication into the revision of laws in the extractive industry, such as Oil and Gas Law and Mineral and Coal Mining Law, 2) Develop standards and methods of contract documents transparency, 3) Develop a specific site to publish contract and licensing documents, 4) Implement disclosure initiative to every contract negotiation process.

You may check the link below for the full policy brief:

https://pwyp-indonesia.org/en/401863/contract-and-licensing-transpa...

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