Working Group: Information governments can expect from operators

Recognising the information asymmetry between governments and companies – which is exacerbated in situations where countries have very little or no experience – participants in the New Producers Group expressed a desire for resources to aid in better understanding the information that they should request and expect from operators in pursuit of effective governance of the petroleum sector. As emerging producers build their capacity, they wish to benefit from other countries’ experience in sourcing and analysing information at critical aspects of a project lifecycle. In many instances, countries are not aware or unsure of the type of information that they are entitled to or can request. Participants at the 5th Annual Meeting agreed that information requirements should ideally be covered in law, however, given the practicalities and timing of legislative reform, having examples of best practice would be useful to incorporate into petroleum agreements.

The New Producers Group working group is addressing this challenge by providing:

1. An overview of the regulatory framework and capacity required to support the collection and dissemination of information for effective governance. Participants acknowledged that information is required by various stakeholders – not just the regulator or other state agencies, e.g. the public, civil society, and opposition. There is therefore a need to communicate with various groups and this requires governments to set up systems to do so. As many emerging producers operate in a low capacity context, challenges on implementation and managing the information and the importance of standardisation and building capacity will be highlighted. Issues such as confidentiality and proprietary information will also be addressed.
2. A checklist of the type of information governments require across the lifecycle (licensing, exploration, development, production).
3. Training on the Government Review of Field Development Plans.
4. Linkage with the Contracts Working Group for the identification of model Clauses that address the ownership of data and reporting requirements.
5. Development of User Guides and Process Manuals, such as Due Diligence regarding Licence Award, Geological Information, Field Development Plans.

Outputs:

• A due diligence checklist and petroleum legal framework and agreement provisions that enable governments to obtain key information. These are to be reviewed by member countries.
• Paper on power shifts between host government and operator over the project lifecycle.
• A course on the Government Review of Field Development Plans was delivered online in October 2020.

Next steps:

• A paper retaining the lessons from regulators in the FDP course. This paper will review how governments can obtain more information from operators through the field development plan review process.
• Follow up workshop for countries involved in the FDP course, to review and formalise their internal process for the review of FDPs.
• Further FDP training sessions are planned in person and online.