Senator Cardin Calls For Increased Transparency In Oil, Gas And Mineral Industries

September 30, 2009 -- Washington, DC – From the floor of the U.S. Senate Tuesday, Senator Benjamin L. Cardin (D-MD) called for greater transparency in the oil, gas and mineral industries in an effort to fight corruption and promote stability in nations rich in such resources. Senator Cardin and Senator Dick Lugar (R-IN) (D-RI), have introduced S. 1700, the Energy Security Through Transparency Act of 2009, which would provide for public disclosure of payments to oil, gas and mineral extraction companies through mandatory filings with the Securities and Exchange Commission, along with co-sponsors Charles E. Schumer (D-NY), Roger Wicker (R-MS), Russ Feingold (D-WI), and Sheldon Whitehouse

Following are excerpts of Senator Cardin’ remarks. The full text is available at http://cardin.senate.gov/news/testimonyrecord.cfm?id=318464.

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“Unfortunately, there are many mineral-wealthy nations – countries with oil and gas resources – that have horrible poverty, open war and very poor governance. The underlying reason in most cases is corruption. There are individuals or groups, and sometimes even leaders, within these resource-rich nations that make their own deals with companies that extract these minerals and use it for their own purpose rather than sharing it or using it – as they should -- for the people of the nation in which these resources are located. It's in the United States’ interest to change the way that these nations deal with their resources and with their wealth.

“This is a humanitarian issue and a human rights issue. Transparency will provide greater economic opportunities for the people in these countries so they can help their nation solve its own economic problems. There also are American companies that would like to do business in these countries. They would like to help the American economy by having business relationships with countries that have oil and gas and other mineral wealth. They are blocked from such business relationships due to the corruption, which creates an unstable business environment. In some cases, a country is so corrupt that it does not have the rule of law or other protections necessary to make sure that their business relationship will be honored.

“The United States can take a global leadership position in fighting corruption with passage of the Energy Security Through Transparency Act of 2009. It would move the United States in the direction of becoming an implementing country of the Extractive Industries Transparency Initiative (EITI). We can lead by example by showing the U.S. understands that there should be transparency in all the contracts we enter into for extraction of mineral wealth from America. As the bill provides, we should require the proper disclosure of payment from companies that use public lands on mineral extractions. EITI is about transparency so that companies and governments can be held accountable.

“We can have an open policy here in America to deal with our energy. It's important for our economy and it's important for our national security to get this done.”

The Energy Security Through Transparency Act of 2009

* Requires companies listed on U.S. stock exchanges to disclose in their regular SEC filings their extractive payments to foreign governments for oil, gas and mining;
* Expresses the Sense of Congress that the Administration should undertake to become an ‘implementing country’ of the Extractive Industry Transparency Initiative (The U.S. currently is a ‘supporting’ country);
* Encourages the President to work with members of the G-8, G-20, the Organization for Economic Cooperation and Development and the Asia-Pacific Economic Cooperation to promote similar disclosure through their exchanges and jurisdictions;
* Commits the Department of Interior to disclosing extractive payments received for resources derived from federal lands.

Source: Senator Benjamin L. Cardin