Executive Magazine - - Special Report -

or not? And [know­ing] who ben­e­fits [is im­por­tant] be­cause if there are in­ter­link­ages with politi­cians it might not ben­e­fit the whole pop­u­la­tion but only some cronies and elites.

So [ben­e­fi­cial own­er­ship] is a cru­cial as­pect but there is still a way to go be­fore fully fledged re­quired im­ple­men­ta­tion. We are re­view­ing the re­sults and lessons of the pi­lot phase so at the board level we can have dis­cus­sions as to how it should be im­ple­mented. Be­cause let’s face it, there are also prac­ti­cal is­sues re­gard­ing im­ple­men­ta­tion. Do you al­ways rely on public gov­ern­ment reg­istries? The an­swer is prob­a­bly not. In­stead, one goes to a com­pany and ba­si­cally asks them to fully dis­close and there are ways to mon­i­tor and vet.

Is there a ben­e­fit to adopt­ing the EITI for a coun­try like Le­banon be­fore sign­ing ex­plo­ration and pro­duc­tion agree­ment (EPA) con­tracts?

Ab­so­lutely. Al­ready you can start set­ting up the sys­tems for trans­parency once the con­tracts come about – the struc­ture of re­port­ing. Many of the coun­tries that might not be rich in nat­u­ral re­sources are adopt­ing the EITI be­cause there are also is­sues of transit pipe­lines and the rev­enues from those. Or if it is an im­por­tant fi­nan­cial cen­ter, or there may also be trad­ing is­sues in­volv­ing oil and gas at ports. So it is not all about pro­duc­tion – for in­stance we’re work­ing very hard for the Swiss to im­ple­ment the EITI and they don’t have [a sig­nif­i­cant ex­trac­tive in­dus­try] but they have very im­por­tant trad­ing com­pa­nies.

How im­por­tant is in­ter­na­tional leg­is­la­tion like the United States’ Dodd-Frank Act or the Euro­pean Union’s Ac­count­ing and Trans­parency Di­rec­tives to hold multi­na­tional com­pa­nies ac­count­able, and what can be done re­gard­ing gov­ern­ments?

The manda­tory dis­clo­sure re­quire­ments fol­low­ing the Dodd-Frank ini­tia­tive and the EU Di­rec­tives es­sen­tially puts the pres­sure on com­pa­nies to do their part to dis­close. Why do I men­tion com­pa­nies? In terms of the re­spon­si­bil­ity of the re­cip­i­ent gov­ern­ment to also dis­close that’s where the EITI is an im­por­tant ini­tia­tive. So what’s im­por­tant [is that], even­tu­ally in Le­banon if there are deals for ex­plo­ration and pro­duc­tion, in­ter­na­tional com­pa­nies re­port, and that will be gov­erned by the EU Di­rec­tives and the Dodd-Frank. That should be good enough, but from a Le­banon per­spec­tive it’s go­ing to be mak­ing the gov­ern­ment ac­count­able and that’s where the EITI comes in – some coun­tries are en­act­ing leg­is­la­tion to im­ple­ment the EITI to make it in­ter­nally manda­tory. cu­bic feet of gas, it is larger than the pre­vi­ous record holder, Is­rael’s Le­viathan. The find is so close to the Cypriot bor­der that, at time of writ­ing, there were spec­u­la­tions in the Cypriot press that it might bleed over, mean­ing Nicosia would get a cut of rev­enues un­der an ear­lier agree­ment with Cairo. Ei­ther way, To­tal said in re­sponse that it would re-eval­u­ate plans for the neigh­bor­ing Cypriot block to which it has rights. Even in times of de­creased in­vest­ment be­cause of the price pound­ing, ENI’s dis­cov­ery has cer­tainly put the eastern Mediter­ranean back in the head­lines.

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