PHNOM PENH, 28 MARCH 2008: The Cambodian Government intends to play a leading role in managing potential revenues from the country’s recently discovered oil and gas reserves and has appealed for continued knowledge sharing from different stakeholders, Deputy Prime Minister H.E. Mr. Sok An said today.
In his closing speech on the final day of the international conference, Fuelling Poverty Reduction with Oil and Gas Revenues - Comparative Country Experiences, he vowed that the Cambodian government would not take a back seat. “We do not want to be mere spectators in our petroleum industry,” he said.
The Deputy Prime Minister said Cambodia’s petroleum companies would endeavor to involve local people and businesses as much as possible in their operations. He added that any input from experienced countries would also help the development of the petroleum sector.
“I appeal for positive contributions from stakeholders in the same manner that this conference has been a positive hearing of sector themes and issues,’’ he said. “It has been a wonderful forum for the sharing of petroleum sector knowledge and learning.”
The conference has brought together more than 500 participants – including senior policymakers, high-ranking officials, global energy experts – from Cambodia and around the globe to examine ways in which resource-rich developing countries can harness their newfound resource wealth to reduce poverty. Panels discussed best practices that have been successfully employed in other countries, including Norway and Timor-Leste. They also outlined the potential dangers of not putting appropriate regulations and frameworks in place before starting production.
The Deputy Prime Minister said the Government was committed to finding long-term positive outcomes. “The translation of the capital value of oil resources into the stored capital value of our people through improved health, social conditions and education is very important for the long-term prosperity of Cambodia,” he said.
The Cambodian Government recognizes the importance of having a good set of laws in place to manage the petroleum sector and is committed to putting such mechanisms in place. “The Government is working hard to establish a comprehensive set of petroleum laws that will provide a sound framework for oil production with best practices reflected, including the principles of transparency and accountability,” the Deputy Prime Minister said.
A key point that emerged from the conference was the need for careful preparation and operational transparency in the management of oil reserves at every stage of the process. High risk areas included establishing National Oil Companies (NOC) and local refineries. Willy Olsen, an oil and gas advisor to Norwegian Oil and Gas Partners, said NOCs have to compete with the private sector and many have failed in the past. Similarly, establishing local refineries can lead to increasing fuel prices as they struggle to compete with larger refineries.
Options for Petroleum Funds or National Resource Funds were explored and those that were well designed and transparent were seen to play a valuable role within the broader context of public sector finance.
The Deputy Prime Minister said the Government was considering this option: “We will explore the establishment and use of petroleum funds for the best advantage of our economy and, where appropriate, consider their use”.
He also called for multiparty collaboration between the Cambodian National Petroleum Authority and other players. “It needs the cooperation of all other stakeholders, be they Government Ministries or Government Agencies, donors, civil society or the media,” he said.
Speakers at the two and a half day event included the Deputy Prime Minister, global energy and development experts, economists from the World Bank, IMF, International Energy Forum and ADB, senior executives from Chevron and PETRONAS, and high-level energy officials from developed and developing countries. The event was organized by UNDP Cambodia in partnership with the Cambodia National Petroleum Authority, Supreme National Economic Council, Norwegian Agency for Development Cooperation, Norwegian Petroleum Directorate and Petrad.
Over the past few years, UNDP has been working closely with the Government of Cambodia, the Norwegian Government and other partners to explore ways Cambodia can best develop and manage its new found resource wealth. Cambodian officials have been linked up with energy experts in countries around the world which have faced similar opportunities and challenges, notably Norway, and more recently, Timor-Leste. The aim has been to share experiences and expertise on how to maximize resource wealth for the benefit of all. This conference is part of the ongoing open dialogue.
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