US Mandates Oil Companies to Disclose Payments Abroad
United States-listed oil, gas and mining companies would be required to reveal all payments they make to foreign governments, including those for drilling or exploration licences.
The new rules adopted by the US Securities and Exchange Commission was aimed at increasing transparency of payments made by the companies to a government for the purpose of the commercial development of a country’s natural resources.
US Congress had created a disclosure regime under the Exchange Act that would support the commitment of the United States Government to international transparency promotion efforts relating to the commercial development of oil, natural gas or minerals.
The SEC noted that the rule applies to payments in relation to extraction, exploration, processing and export of oil, natural gas and minerals as well as licences relating to such oil and gas transactions.
According to Reuters,payments rule would apply to any payment, including a series of related payments over $100,000.
The payments that need to be disclosed, include taxes and royalties, dividends and infrastructure improvements and other types of fees.
The new rule also requires companies to provide information on a project-by-project basis, but gives companies the ability to define exactly what constitutes a “project.”
United States-listed companies, which operate in Nigeria include, Shell oil company, Chevron Corporation, ExxonMobil, Halliburton, Conoco Philips among others.