National oil companies with $ 3.1 trillion in assets, are dangerously under-pollinated – Report

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State-owned oil companies and their impacts on economies are misunderstood and merit greater scrutiny, a new report indicates.

Using the Natural Resource Governance Institute's (NRGI) new open National Oil Database, researchers have shown that many state enterprises are failing to disclose critical information to the oversight of public revenues.

National oil companies (NOCs) produce the majority of the world's oil and gas. Companies in the database hold combined badets of more than $ 3.1 trillion.

The ten largest, including Saudi Aramco and Mexico's Pemex, include ExxonMobil and BP.

"The sheer amount of national wealth in these companies can contribute to a sense that they are 'too big to fail,'" NRGI advisor Patrick Heller said. "The combination of mbadive economic influence and weak oversight can pose huge economic risks in many countries."

Beyond the transparency problem, some national oil companies carry huge debts that burden their national economies. Some have debts in amounts higher than 10 percent of their GDP. Venezuela's troubled state oil company has exceeded 20 percent of GDP.

Many NOCs have required multibillion-dollar government bailouts in recent years, becoming a costly drain on public finances.

The NRGI report finds that at least 25 countries are "national oil company dependent," meaning that the NOC on its own collects revenue to 20 percent of the total revenue of the government.

The fiscal health of many countries and their governments' ability to use revenue for development depends heavily on how well.

"In dozens of resource-rich countries," said NRGI President and CEO Daniel Kaufmann said. "In these countries, improving governance is the development challenge of a generation, as subpar governance of their national resources perpetuates poverty and inequality.

"State-owned enterprises can weigh a country down or help propel development. Getting their governance right is crucial, "Kaufmann said.

In many countries, NOCs are not held accountable, because they are not disclose enough information, or because they are inconsistent. Under-polled companies might be poorly or become vessels for corruption. Increased transparency is a critical lever for holding company accountable leadership and encouraging strong returns on public investment.

"This new database should help demonstrate the power of information about national oil companies," Heller said. "It can be a valuable tool for NOCs, governments and their citizens to understand how these companies manage public badets and liabilities, and to insist that they perform."