WASHINGTON, September 20, 2011 - API commended the Obama Administration for promoting transparency in company payments to foreign governments in a way that promotes disclosure without putting U.S. companies at a competitive disadvantage. API also urged the Securities and Exchange Commission (SEC) to adopt the administration's position instead of a unilateral approach that could harm competitiveness.
"The oil and natural gas industry fully supports transparency, and the SEC should adopt this process," said Khary Cauthen, API director of federal relations. "Under the SEC's current approach to revenue disclosure, foreign oil and natural gas companies could have access to confidential, proprietary information regarding U.S. business interests."
The SEC is working to implement a provision of the Dodd-Frank Act requiring U.S.-listed companies to report detailed, project-level information about payments made to foreign governments. The provision would not apply to foreign national oil companies, such as China National Petroleum Company and Gazprom, which often compete with U.S. companies for international contracts.
The administration endorsed the internationally-recognized Extractive Industries Transparency Initiative (EITI) to promote transparency in payments to foreign governments in its National Action Plan released today.
"The Obama administration has recognized the value of this framework as the most effectiveway to promote transparency while protecting commercially sensitive project-level data and ensuring U.S. companies are not placed at a competitive disadvantage," Cauthen said.
Under EITI, many countries report payments received from companies on an aggregate basis. This model has been recognized by governments around the world as advancing the objective of revenue transparency while also protecting individual companies and shareholders from the competitive disadvantage possible if some, but not all, companies doing business in a country must disclose commercially sensitive information, Cauthen explained.
API represents more than 480 oil and natural gas companies, leaders of a technology-driven industry that supplies most of America's energy, supports 9.2 million U.S. jobs and 7.7 percent of the U.S.economy, delivers $86 million a day in revenue to our government, and, since 2000, has invested over $2 trillion in U.S. capital projects to advance all forms of energy, including alternatives.