• Aid policy
• Debt Management
• Education
• Financial sector
• Growth and Resources
• • Trade
  • Infrastructure
  • Agriculture and Rural Development
  • Extractive Industries
• Health
• Poverty and Social Protection
• Private Sector
• Public Financial Management
• Public Management and Accountability
• Regional Development and Local Government
• Social Development
• Statistics

Extractive Industries

Extractive industries and their relationship to natural resource management is at the heart of many of the most significant challenges facing the world:

• There is evidence that natural resource abundance has often proved to be a 'curse' rather than a benefit for many developing economies. There has been increasing concern about the social and economic impacts of resource exploitation as the search for new sources of oil, gas and minerals has intensified, particularly in fragile states.
• The livelihoods of many poor people are dependent on renewable natural resource systems whose sustainability is under threat as a result of population pressure and climate change.

OPM’s work has focused on applying high quality, objective, multidisciplinary analysis to these issues, and to fostering the development of partnerships across stakeholders to develop a shared understanding of the challenges of natural resource management. This has included providing advice to corporate and government clients, as well as to multilateral agencies, on how the benefits from extracting natural resources can be maximised for social advantage and for sustainable development outcomes.

Much of the work has been undertaken for the Resource Endowment initiative (REi) of the International Council on Mining and Metals (ICMM) where OPM has been the lead consultant. This was initiated with the specific aim of going beyond well-trodden debates about the extent and nature of the ‘resource curse’, and instead documenting ways in which mining’s socio-economic contribution could be improved. Although sponsored by industry, the project’s focus on identifying ways to improve outcomes, and acknowledgement of the existence of problems has helped underpin its credibility. This work has been encouraged by the greater pressure and international scrutiny of the issues in many countries from organisations such as the IFC to ensure sound standards.

In this and other related work OPM has used a range of techniques including cost benefit and impact analysis, use of dynamic Computer General Equilibrium models, calculations of Output and Income multipliers, stakeholder consultations, household surveys and in-depth case studies.

OPM’s capacity in this area draws on the wide range of expertise available across the company, including capacity to undertake rigorous economic (and social) contribution assessments, understanding of public finance management issues, political economy analysis, survey design and management; and the development of monitoring and evaluation mechanisms. OPM works with a network of Associates and collaborators to complement the skills available in-house.

OPM’s work on the mineral sector has included:

• A review of the macro-economic and local level impacts of the Guinea Alumina Project (Guinea Alumina Corporation), including an appraisal of the mitigation measures and recommendations for implementing a monitoring and evaluation framework at the project level.
• Study for the ICMM Resource Endowment initiative (REi) to investigate how the exploitation of non-renewable mineral resources can support long-term and inter-generational socio-economic development. This included the development of a ‘toolkit’ to provide a practical approach to documenting the impacts (both good and bad) of individual mining projects at a local, regional and national level; and four in-depth case studies of the relative successful use of mining as part of broader economic and social development. OPM has also produced a significant analysis of the strengths and weaknesses of different structures of minerals taxation regimes.
• A revised ‘toolkit’ has been produced as part of the ICMM Mining: Partnerships for Development programme. In developing this toolkit, OPM has provided a methodology that provides for the objective assessment of both the perceived and actual benefits that result from large-scale mining. The toolkit has been applied in six countries using readily available data, where we were able to generate evidence about the social and economic contribution of mining that could be used for subsequent multi-stakeholder discussions. Visit the ICMM website for further details about Mining: Partnerships for Development, including a recent publication that details where companies are already involved in a range of range of multi-stakeholder partnerships.
• The calculation of Output and Income multiplier effects of a large oil investment by EXXON in Chad.
• Review of DFID’s support to the Nigeria Extractive Industries Transparency Initiative (EITI). OPM also holds a framework contract with DFID for undertaking EITI Assessments.
• Providing development economics seminars to make BP managers more aware of the developmental context in which their oil and gas projects in developing and transition countries are undertaken.

OPM’s recent work on renewable natural resource management includes the following studies:

• Development of a framework for DFID to understand the institutional and policy issues relating to the management of renewable natural resources.
• Preparation on behalf of the Global Mechanism of the UN Convention on Combating Desertification of a study for the Terrafrica Partnership on Sustainable Land Management in Africa.

Project Examples