Albania stands among 49 countries complying with the Extractive Industry Transparency Initiative.
As part of the ongoing implementation of this initiative the Albanian Government publishes this informative report on the extraction of oil, gas and other minerals, contribution of this industry to the State budget and allocation and spending of these income. The final aim of this initiative is to promote transparency in order to prevent corruption, and raise awareness among citizens to demand from their Government proper use of the fiscal and non-fiscal income generated from the exploration and exploitation of natural resources in Albania.
The EITI report for the years 2013 and 2014 provides an overview of the upstream oil and gas sector, mining sector and hydro-energy sector and reconciliation of main flows paid by licensees and collected from the government agencies in these sectors.
Based on data reported by AKBN and ERE production generated out of these sectors is estimated at USD 777 million in 2013 and USD 815 million in 2014. Whilst its contribution to the National Budget were 8.7% of revenue recorded in National budget in 2013 and 3.5% in 2014.
Contribution of the extractive industry to total employment in the country is almost insignificant. AKBN reports that companies licensed in oil, gas and mining sectors employee collectively less than 1% of total employee workforce registered in the country in 2013 and 2014.
Crude oil comprised about 67% of the total output in both years. Approximately 87% of total oil producedwas extracted from the Patos-Marineza oilfields. Chapter 2 provides an overview of regulatory and fiscal regime and exploration and production activities in the three sectors.
Selection of reporting entities
All companies operating an exploration license in oil, gas, and mining and a production license in oil and gas were required to report under the EITI Standard. Thus, cash flows reconciled for the oil and gas sector represent 100% of cash flowscontributed by the sector for the selected revenue streams.
Because of the large number of small-scale producers in the mining and hydro-energy sector, certain materiality criteria based on annual turnover and production were applied to select the most significant producers.
The selection resulted in 81 mining companies in 2013, which based on the data provided by AKBN, comprised 85% of the production value and 99 mining companies in 2014, which comprised 87% of the production value.
In the hydro-energy sector, the MSG selected to report the 10 largest producers and 5 largest investments in the pre-production phase.
By the date of this Report cash flows were reconciled to 99% of cash flows reported from licensees and the Government or licensees.
Section 5 and 6 present the reconciliation on an aggregated level. Company-by-company reconciliation is presented in the appendices to the report. Table 3 and 4 below present a summary of the cash flow reconciliation.