OpenOil was founded in the belief that creative, practical and socially progressive policy making in the oil and gas industries is both vital to our collective future, and possible within current constraints.
Yes, our continued addiction to hydrocarbons is a bad idea. And yes we need to get much more serious about renewables. But even with the most aggressive expansion of green energy imaginable, nobody has a credible plan for a carbon-free economy before 2030. Until then, the oil and gas industries will continue to play a huge part in global prosperity and development – or not. To refuse to engage with that reality is dangerous and irresponsible. It is also to guarantee “business as usual” in day-to-day workings of the industry.
The Resource Curse continues to blight millions of lives. OpenOil believes that oil and gas production can benefit the citizens of producing countries more effectively, and the damage wrought by opaque and undemocratic government, often as a result of the prize to be obtained by controlling natural resource wealth, can be mitigated and reversed.
The increasing uncertainty over how much oil is left, and at what extractable price, also makes global energy security an ever greater concern. Resource diplomacy is becoming more intensive as new resource conflicts loom on the horizon. We need better ways to ensure more stable energy supplies and more long-term thinking on energy demand.
OpenOil believes in the following general principles:
- The single biggest demand is for more creative thinking. The relative impoverishment of policy making around the oil and gas industry, despite the fact it is so vital and receives such critical attention around the world, is astounding. OpenOil is dedicated to promoting wider and deeper policy debates across the planet, with actionable results. Blanket denunciations and demonisation have not led to better policies and better outcomes.
- Current transparency and governance initiatives are necessary but not sufficient. The Extractive Industries Transparency Initiative has succeeded in a short time in making transparency a norm that companies and governments alike come under increasing pressure to comply with. But EITI also applies only one kind of transparency to one part of the value chain, and in any case the jury is out on how much transparency, as currently defined, can drive actual reform and policy change. Transparency is virtually the only progressive policy that has achieved traction in the oil industry to date and must be honoured for that. At the same time, we must move beyond it.
- Policy innovation must be grounded in the reality of market-driven solutions. Oil is a competitive for-profit industry and will continue to be so. Initiatives that seek to reduce rent seeking and volatility should work with and not against market mechanisms, by attempting to find ways to reduce corporate risk by addressing the time inconsistency problem, for example, or by publicly funded geological work.
- Direct oil dividends to citizens, as happens in Alaska, is a policy idea that deserves extensive review and the chance of a country-level implementation. Structured in different ways, direct dividends could bring tens of millions of people out of poverty and contribute to the MDG goals as well as creating a radically different relationship between oil country citizens and their governments.
- Fuel subsidies are almost always a bad idea which benefit the rich more than the poor and encourage corruption. A state’s obligation to needy citizens should be met in other ways.
- The private sectors of oil-rich countries can and should be systematically engaged on issues of transparency and shareholder rights as they pertain to management of the oil industry. Integral to this is freedom of access to information.
- Three global debates are being held separately which need to be linked: on climate change, energy scarcity and security, and the Resource Curse. We need to up the game and evolve workable policies which address two or three of these issues at the same time, instead of siloing each issue and producing policy agendas which, by being unintegrated, are unimplementable. OpenOil seeks to be at the heart of such joined-up thinking.
- Media and popular culture are vital and neglected areas of awareness in and around oil industries. Long-term programs are needed to build energy specialisation among journalists. In oil-revenue dependent countries, building expertise should begin with oil because of its central role in political economy, and cover other energy forms later.
- Social media, Open Source, and Open Content approaches have a role to play in the creation of a more open atmosphere around the oil industry.