Event reveals striking differences in how countries manage ‘black gold’

Experts from 11 oil-producing countries recently met at a Forum event in the heartland of Canada’s oil industry to map out a series of knowledge-sharing events and activities.

The meeting focused on Oil and Gas in Federal Systems in a program of events that will eventually lead to the publishing of a book on this highly topical issue.

The experts attending the meeting came from Argentina, Australia, Canada, India, Malaysia, Mexico, Nigeria, Pakistan, Russia, the United States and Venezuela. They gathered in Edmonton Alberta, which has become an important staging point for Canada’s large-scale oil sands projects in northern Alberta.

Country representatives delivered presentations on oil and gas arrangements in their respective countries, describing the constitutional, fiscal and political context in which these issues have played out. This exchange revealed both common challenges and striking differences in how countries manage oil and gas resources. Oil is often referred to as the "curse of the black gold” in countries where it is mismanaged. Indeed, the experts found differences particularly in how the direct and indirect revenues generated from the exploitation of these resources are shared among the central government and the states and provinces of federal countries.

The overall objective of the Forum’s Oil and Gas program is to generate a comparative analysis of the management of oil and gas resources in federal systems, the synthesis of which will support practitioners in their management of this sector. A publication on the matter is forthcoming and will serve as an educational tool to inform and assist policy and decision makers.

The workshop was held Oct. 10 11, 2008. It was hosted by the Forum of Federations, in partnership with the Department of Economics of the University of Alberta. Also in attendance were representatives from Resource Watch and the Government of Alberta.

Participants from the Americas included Osmel Manzano, Senior Research Economist, Inter-American Development Bank, New York City, USA; Victor Carreon, Profesor y Director de la División de Economía, Centro de Investigación y Docencia Económicas, Mexico City, Mexico; George Anderson, President, Forum of Federations, Ottawa, Canada; Akram Esanov, Senior Economist, Revenue Watch Institute, New York City, USA; Peter Mieszkowski, Professor of Economics and Finance, Rice University, Seabrook, Texas, USA; David Parks, Forum of Federations, Ottawa, Canada; André Plourde, Chair, Department of Economics, University of Alberta, Edmonton, Canada; Ronald Soligo, Professor of Economics, Rice University, Seabrook, Texas, USA; Juan Antonio Zapata, University of Mendoza, Argentina.

Participants from other continents included Gulfaraz Ahmed, Chief Operating Officer, Pakistan Exploration (Private) Limited, Islamabad, Pakistan; Michael Crommelin, Director of Studies, Graduate Program in Comparative Law, University of Melbourne, Australia; Ligia Noronha, Director, Resources and Global Security, The Energy and Resources Institute, New Delhi, India; Galina Kurlyandskaya, Director General, Centre for Fiscal Policy, Moscow, Russia; Mikhail Subbotin, Advisor, Parliamentary Committee on Natural Resources, Moscow, Russia; Rotimi Suberu, Professor, University of Ibadan, Nigeria; and Chong Hui Wee, Professor, Universiti Teknologi MARA, Kuching, Sarawak, Malaysia. Helder Pinto of the Federal University of Rio de Janeiro submitted a presentation but was unable to attend.

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