International oil majors fare poorly in transparency, says Transparency International

Who says transparency, or the lack of it, is the bane of poorer countries? In a startling disclosure, Transparency International (TI) has indicted oil majors from the richest countries in the world as being far from transparent when it comes to the payments they make to resource-rich countries, leaving the door open to corruption and hampering efforts to fight poverty.

These assertions were made in the 2008 Report on Revenue Transparency of Oil and Gas Companies, which evaluates 42 leading international and national oil and gas companies operating in 21 countries, based on the transparency of their reporting, particularly on payments made to governments for resource extraction rights.

The research says western companies such as ExxonMobil, ChevronTexaco and BP rank as middling or poor performers on voluntarily disclosing information about their operations – alongside China National Offshore Oil Corp (CNOOC), Russia's Lukoil and Petronas of Malaysia. Royal/Dutch Shell, Brazil's Petrobras, Norway's StatoilHydro, BG Group of UK and Petro-Canada were among the best performing companies.

ExxonMobil, the largest energy group in the world, ranks at the very bottom, with CNOOC and Lukoil for company. India's Oil and Natural Gas Corporation (ONGC) figures right on top for domestic transparency, but at the bottom for its international operations.

ONGC faired in the top tier when it came to disclosure of revenue at home, providing information about regulatory structure and procurement practices and disclosure of anti-corruption programmes. However, for overseas operations, it fell in the lowest tier for disclosing only by geographical segment and providing almost no additional information relevant to revenue transparency.

The report says transparency is "not yet a common practice" for many of the companies driving oil export revenues worth an estimated $866bn (€555bn, £437bn) globally in 2006. The research says: "There remains a large group of low performers...Revenue transparency from oil and gas companies can end much of the secrecy that keeps citizens in the dark about resource wealth."