A recent regulatory filing has shed light on the massive sums of money paid by the three largest US energy exploration companies to foreign governments last year. The disclosures, mandated by the Securities and Exchange Commission, reveal that Exxon Mobil, Chevron Corp, and ConocoPhillips paid a staggering $42 billion to foreign governments in 2023, a figure eight times higher than their US-based payments.
Transparency advocates have long pushed for this level of disclosure, arguing that it is essential to understand the financial transactions of Big Oil’s global operations and to determine whether US taxpayers are receiving a fair share of the value generated by the country’s booming oil and gas production.
The United States has emerged as the world’s largest oil and gas producer in recent years, largely due to the Permian Basin in Texas and New Mexico. However, environmental advocates argue that the country is not reaping sufficient benefits from its natural resources. “The US gets a raw deal when it comes to extracting our natural resources,” said Michelle Harrison, deputy general counsel for EarthRights International.
Exxon Mobil, for instance, paid out $22.5 billion in taxes, royalties, and other items to foreign governments, with the United Arab Emirates, Indonesia, and Malaysia topping the list. In contrast, the company’s US-based payments totaled a mere $2.3 billion, including just $1.2 billion to the US Internal Revenue Service. Chevron Corp and ConocoPhillips followed a similar pattern, with the majority of their payments going to foreign governments.
While Exxon Mobil argued that comparisons between US and overseas payments are unfair, Chevron Corp took a more conciliatory tone, stating that it would continue to work towards transparency and accountability between governments and the industry. The company’s low overhead costs in the US, particularly in the Permian Basin, were cited as a key advantage.
The new disclosure requirements, mandated by Section 1504 of the Dodd-Frank Act, mark a significant step towards greater transparency in the energy sector. After years of opposition from the industry, the Securities and Exchange Commission finally adopted the rules in 2020, paving the way for a more informed debate about the role of Big Oil in the global economy.
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