Investment in Extractive Industries

Undeniably, extractive industries pose unique challenges for sustainable development, making solutions all the more urgent, but also more difficult than in other sectors. Some of the specific challenges include the asymmetry of knowledge and skills between governments and companies, the pervasive confidentiality of the sector, the non-renewability of the resources, the risk of Dutch disease, the traditional ‘enclave’ model of the sector, and the historical records of human rights and environmental shortfalls, among others. However, the potential benefits for both parties are large, and extractive industries in particular have the potential to be transformative for developing countries. The extent to which host countries benefit from their resources depends heavily on the policies of the host country and the investor, the regulatory and legal framework governing their relationship, and the institutions available to find mutually satisfactory outcomes for both parties.

Our Activities and Projects

+ Coordinating Multi-Stakeholder and Expert Dialogue

  • Negotiation Support to Resource Rich, Low-and Middle Income Countries
    CCSI has launched a series of meetings of negotiation support providers to create a forum to discuss common challenges and opportunities and to facilitate greater coordination among support providers. The overall objective of these meetings is to improve the availability, accessibility and quality of technical assistance and trainings for host governments at all stages of preparing for, negotiating and implementing large-scale deals.
  • New Petroleum Producers Discussion Group
    CCSI is a knowledge partner to the New Petroleum Producers Discussion Group project, co-organized and sponsored by Chatham House, NRGI, the Africa Governance Initiative and the Commonwealth Secretariat. This project aims to help emerging oil and gas producers to think critically about the various policy options available during the first steps of exploration and development or when restructuring their... read more
  • Comparing Lessons Learned for Extractive Industry Investments and Large Land-Based Agricultural Investments
    CCSI has brought together stakeholders to explore good governance initiatives for extractive industry investments and large land-based agricultural investments -- in particular, whether, and if so, why, certain good governance efforts may be more advanced in one sector than in the other, and what could be done to further advance governance initiatives in both sectors.
  • Columbia International Investment Conference
    Since 2006, CCSI has hosted an annual Columbia International Investment Conference. These annual conferences bring together numerous stakeholders including high-level government officials, corporate executives, investors, academics, and civil society for forward-looking policy discussions of critical issues in international investment for sustainable development. A list of the past Conferences, with links to the programs and materials,... read more
  • Ad-hoc events
    CCSI regularly hosts speakers, roundtables, workshops, and events on a variety of related topics.

+ Policy and Advisory

+ Research

  • Conceptualizing Economic Linkages to the Resource Sector
    GIZ has been working with CCSI to develop research and training materials around economic linkages to the resource sector.
  • Enabling Resource Contract Transparency
    Contract transparency in natural resources is an emerging norm that many governments, companies and international institutions have endorsed, particularly within the extractive industries. However, more must be done to make it a standardized and meaningful norm that leads to better accountability within the extractive industries as well as around investments in land, agriculture, and forestry.... read more
  • Mining and Water Risk: Diagnosis, Benchmarking, and Quantitative Analysis of Financial Impacts
    As part of 3-year grant from Norges Bank Investment Management (NBIM), CCSI is working with the Columbia Water Center to develop and benchmark a modeling platform for quantitatively assessing the environmental risks associated with gold and copper mining projects and their resulting financial implications.
  • Comparing Mineral Regimes: Licensing vs. Contracts
    CCSI examined the advantages and disadvantages of different minerals regimes (licensing regimes vs. contractual arrangements) in 18 countries around the world. For the 13 countries that used mining contracts, CCSI further examined the contract negotiation and implementation processes of 30 mining contracts as well as the relationship between those countries' mining contracts and their legal regimes. CCSI also identified potential opportunities for external experts to support resource rich, low income countries in contract negotiations.
  • The Mine of the Future
    CCSI, IISD and Engineers Without Borders researched the technological innovations that are being developed, assessing when these technologies could be rolled out, and quantifying their impact on local employment and procurement and how local content policies should adapt.
  • Fossil Fuel Companies and Climate Change
    CCSI has been exploring what strategies fossil fuel companies have embraced in order to address climate change concerns and what responsible investors could request from fossil fuel companies in order to move towards a decarbonized economy.
  • Mining and the Sustainable Development Goals
    In September 2015, the UN member states agreed on a set of 17 Sustainable Development Goals (SDGs), which represent the global agenda for equitable, socially inclusive, and environmentally sustainable economic development until 2030. Mining companies have the potential to become leading partners in achieving the SDGs. Through their direct operations, mining companies can generate profits, employment, and economic growth in... read more
  • Leveraging Mining-Related Infrastructure Investments for Development
    With the support of the World Bank and the Australian Government, CCSI has been exploring regulatory, operational and commercial models to leverage mining-related infrastructure for broader development needs.
  • Managing the Public Trust: How to Make Natural Resource Funds Work for Citizens
    The Natural Resource Governance Institute (NRGI) and the Columbia Center on Sustainable Investment (CCSI) have conducted a world-wide survey of NRFs looking at their management, investments, transparency, and accountability to the public, as well as the fiscal rules that govern them. This project seeks to foster cross-country experience-sharing on fund governance.
  • Employment from Mining and Investments in Land for Agriculture
    The employment potential of investments in extractive industry projects and land acquisitions for agriculture is often touted both by governments and by companies in support of investor-friendly policies and large-scale investments in natural resources. CCSI is examining how job numbers are calculated, which factors influence job creation, and the quality and sustainability of these jobs, as well as whether job creation generated from these investments is net positive.
  • Community Development Requirements: Domestic Laws, Best Practices, and Community Development Agreements Database
    The project is collecting and reviewing community development requirements for mining companies and aims to create a matrix that encompasses these requirements as well as a database of agreements.
  • A Regulatory, Operational and Commercial Framework for the Utilization of Associated Gas
    CCSI is working to develop a regulatory and operational framework that would unlock the value of the APG that is currently wasted, in order to improve energy efficiency, expand access to energy, and contribute to climate change mitigation, thus promoting sustainable development.
  • Developing a Model for a Multi-Stakeholder Human Rights Impact Assessment
    CCSI is collaborating with the Sciences Po Law School Clinic and the Danish Institute for Human Rights to develop and test a practical model for a comprehensive multi-stakeholder human rights impact assessment (MS HRIA) of private sector investment projects. HRIAs have become increasingly prominent in recent years, particularly as companies focus on conducting human rights... read more
  • Fiscal Regimes for Natural Resources
    CCSI is researching several aspects of designing and implementing a fiscal regime in an attempt to find legal and fiscal elements that can help avoid unanticipated consequences or disputes between the investor and the government over the course of the investment.
  • Business Case for Transparency
    CCSI strongly supports the transparency of contracts and tax flows and has published various research and papers making the business case for transparency, including two submissions to the SEC in 2011 and 2015.
  • Review Mechanisms in Natural Resource Contracts
    CCSI has published a brief which examines the use of built-in review periods in extractive industry contracts as a mechanism for managing investor–host-country relations over the duration of a project. CCSI completed a survey of periodic review mechanisms contained in extractive industry contracts, to analyze how they have been used to date and understand the purposes for which they may usefully be applied.
  • Downstream Beneficiation of Extractive Resources
    This research looks at the economic prerequisites that attract first degree downstream beneficiation industries, such as steel mills, and the extent to which these industries have contributed to further domestic linkages in the past, and assesses whether it makes sense to provide large incentives for these investments.
  • Fostering Knowledge and Technology Spillovers of Extractive Industry Investments
    This research project assesses the channels through which knowledge and technology can be transferred and, based on successful country case studies, provides recommendations on how governments can enhance technological spillovers in oil, gas, and mining.
  • Comparing Company Profits and Government Revenues from Extractives During the ‘Commodity Super Cycle’
    This research project aims to assess whether it is reasonable for governments to demand a larger share of the pie by comparing company profits to government revenues during the boom years.
  • Contextualizing Stabilization Clauses
    This research assesses whether political risk indicators are a good measure to predict fiscal regime changes, with the ultimate aim to create a framework which investors and governments can use to negotiate the length of future stabilization clauses.
  • Review of Competitive Bidding Frameworks for Natural Resource Rights
    This study surveyed the trend toward countries integrating competitive bidding provisions for mineral rights allocation into their national legislation and regulations, and sought to analyze these issues.
  • Strategic Environmental Assessment
    The aims of this research are to propose how and when strategic environmental assessments can be integrated into planning processes in the pre-contracting phase and to support governments at the ministerial level in their implementation, looking at tools and institutional framework enabling participatory and cross-ministerial processes.
  • Resource for Infrastructure Deals
    CCSI, in collaboration with the Carter Center, is developing two economic models for the Sicomines mine in the Democratic Republic of the Congo (DRC) to compare the financial flows under the resource for infrastructure deal with a 'traditional' contract under the mining code of the DRC.
  • Cross-Border Pipelines
    This project examined the bargaining power of cross-border pipeline transit countries and the range of factors that influence it, including their position in the pipeline, their commercial interest in the project as well as their foreign policy strategy.

+ Resources and Tools

  • Assessing Water-Related Legal Risks in the Mining Sector
    Mining projects require access to water. With increased water scarcity and adverse environmental impacts becoming more prominent, the number of conflicts with local communities about the availability and quality of water has been on the rise, and this trend is set to continue. Against this backdrop, Norges Bank Investment Management (NBIM) approached the Columbia Water... read more
  • Open Fiscal Models
    Alongside growing revenue and contract transparency, increasing model transparency is needed. Only with financial model transparency can relevant actors better assess whether contracts are balanced in terms of fiscal returns and understand when revenues start flowing to the government. CCSI strongly supports financial model transparency and has developed two open fiscal models. We are currently... read more
  • Mining Contracts: How to Read and Understand Them
    In December 2013, a diverse group of 14 experts from Africa, Asia, North and South America, and Europe worked together for five days to produce a user-friendly guide in English and in French on “Mining Contracts: How to Read and Understand Them,” to help policy makers, civil society, citizens, and the media understand the often... read more
  • A Database of Publicly Available Oil, Gas and Mining Contracts CCSI, together with the World Bank and Natural Resource Governance Institute, has developed, an online, searchable and user-friendly database of publicly available oil, gas and mining contracts from around the world. Users can search contracts by country, by natural resource or by type of contract; view summaries of key social, environmental, fiscal, and operational provisions; and download... read more
  • Fossil Fuel Companies and Climate Change
    CCSI has been exploring what strategies fossil fuel companies have embraced in order to address climate change concerns and what responsible investors could request from fossil fuel companies in order to move towards a decarbonized economy.
  • Mining and the Sustainable Development Goals
    In September 2015, the UN member states agreed on a set of 17 Sustainable Development Goals (SDGs), which represent the global agenda for equitable, socially inclusive, and environmentally sustainable economic development until 2030. Mining companies have the potential to become leading partners in achieving the SDGs. Through their direct operations, mining companies can generate profits, employment, and economic growth in... read more
  • A Framework to Leverage Mining-related Infrastructure
    Thanks to a grant from the Australian Government, CCSI has developed an economically, legally and operationally rational framework to enable shared use of mining-related infrastructure, including rail, ports, power, water, internet and telecommunications.
  • Support for Host Country Governments in the Planning, Preparation for, Negotiation, Implementation, and Monitoring of Large-Scale Investments
    CCSI created a Negotiation Support Portal designed to improve the accessibility of technical assistance and of useful tools and resources to assist host governments planning, preparing for, negotiating, monitoring, and implementing large-scale investments in the extractive industries, land and agriculture, and infrastructure sectors, and to facilitate coordination among support providers and host governments.
  • Local Content Laws & Contractual Provisions
    CCSI is examining local content provisions inserted in legal frameworks governing resource investments, including in contracts, legislation and bidding practices.
  • Checklist for Regulations to Facilitate the Imposition of Capital Gains Tax
    Against the backdrop of highly profitable deals concluded between companies transferring project shares, CCSI has researched the challenges of imposing a Capital Gains Tax. The attached note outlines some scenarios by which direct and indirect transfers of project shares may take place, to serve as a broad checklist in designing regulations for a capital gains tax... read more
  • Policy Briefs, Guides and Other Publications
    CCSI produces a number of policy briefs, guides and other publications that are useful resources on topics of extractive industries, land and agriculture, and investment law and policy.

+ Teaching and Curriculum Development