MSG Meeting on covering the operational results of Ukraine’s extractive industries in 2014-2015
16 November 2016
A regular meeting of the Multi-Stakeholder Group for implementation of Extractive Industries Transparency Initiative in Ukraine took place on 15 November. A draft EITI Preliminary Report prepared by TOV Ernst&Young Audit Services (Independent Administrator), covering the operational results of Ukraine’s extractive industries in 2014-2015, was presented to meeting participants. In addition, adapted reporting for 2014-2015 was approved for Ukraine, which means accounting for the situation regarding the occupied Crimea and the territories of Donetsk and Luhansk oblasts beyond the government control
The Independent Administrator has noted a much more difficult situation with data gathering compared to the 2013 report. Today, the collected data cover about 30% of commodity and financial indicators, and it is primarily the government agencies and companies, which have sent their information. There is no information about the companies, which exported and imported coal; a significant proportion of extractive companies have also failed to provide information about their outputs and payments made, including DTEK. The most complicated situation is with disclosure of the information about the production of titanium, which was fully closed at the central government level in 2015.
In preparing the Report, the Independent Administrator is willing to ensure disclosure of payments at the level of each of the oblasts, as the requirement, which was emphasized by representatives of nongovernmental organizations at previous meetings. However, it is impossible to include the distribution of funds paid by NAK Naftogaz of Ukraine, Ukrtransgaz, and Ukrtransnafta, since they have no regional allocation of payments.
An EITI International Board member Oleksii Orlovskyi has shared information about the results of its scheduled meeting, which was held in Astana, Kazakhstan, in early November. Among other things, admission of new members, such as Australia, Armenia, and Mexico, is expected. However, an issue is raised of possible expulsion of Azerbaijan, which would become the first such precedent in the history of EITI (due to violation of the requirement for independent participation of representatives of the civil society in the process). Also discussed at the meeting were the issues of EITI funding at the global level, and in particular it is suggested to introduce financial contributions for EITI candidate and compliant countries.
Based on the review of the draft report, it was decided to continue data gathering and analysis. MSG is to send out official letters to the companies, which have not provided their reports yet; and appeal to the EITI International Secretariat with a request to postpone the report publication date in order to improve its qualitative indicators for enhancing the changes of successful validation.
Also, based on the meeting results a task was set to train the representatives of local NGOs to correctly and as fully as possible to use the report data, taking into account its increased information section and the need of using contextual information and monitoring of implementation of recommendations. Efforts towards passing the law on disclosure of information in extractive industries remain relevant at the central government level.
The Independent Administrator has noted a much more difficult situation with data gathering compared to the 2013 report. Today, the collected data cover about 30% of commodity and financial indicators, and it is primarily the government agencies and companies, which have sent their information. There is no information about the companies, which exported and imported coal; a significant proportion of extractive companies have also failed to provide information about their outputs and payments made, including DTEK. The most complicated situation is with disclosure of the information about the production of titanium, which was fully closed at the central government level in 2015.
In preparing the Report, the Independent Administrator is willing to ensure disclosure of payments at the level of each of the oblasts, as the requirement, which was emphasized by representatives of nongovernmental organizations at previous meetings. However, it is impossible to include the distribution of funds paid by NAK Naftogaz of Ukraine, Ukrtransgaz, and Ukrtransnafta, since they have no regional allocation of payments.
An EITI International Board member Oleksii Orlovskyi has shared information about the results of its scheduled meeting, which was held in Astana, Kazakhstan, in early November. Among other things, admission of new members, such as Australia, Armenia, and Mexico, is expected. However, an issue is raised of possible expulsion of Azerbaijan, which would become the first such precedent in the history of EITI (due to violation of the requirement for independent participation of representatives of the civil society in the process). Also discussed at the meeting were the issues of EITI funding at the global level, and in particular it is suggested to introduce financial contributions for EITI candidate and compliant countries.
Based on the review of the draft report, it was decided to continue data gathering and analysis. MSG is to send out official letters to the companies, which have not provided their reports yet; and appeal to the EITI International Secretariat with a request to postpone the report publication date in order to improve its qualitative indicators for enhancing the changes of successful validation.
Also, based on the meeting results a task was set to train the representatives of local NGOs to correctly and as fully as possible to use the report data, taking into account its increased information section and the need of using contextual information and monitoring of implementation of recommendations. Efforts towards passing the law on disclosure of information in extractive industries remain relevant at the central government level.
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