chapter  4
The Effects of Alternative Fiscal Arrangements on Host Country Returns and Petroleum Investments
Pages 27

International agency assistance for petroleum exploration and development in the LDCs has been made available mainly from the United Nations Development Program (UNDP) and from the World Bank Group, with a few loans from the Inter-American Development Bank (IADB). In a report of August 1980, the World Bank outlined an assistance program for energy development for fiscal years 1981-85 that included, technical assistance for energy sector review; promoting oil and gas exploration; and investment in oil and gas production. However, early in 1981 the Reagan administration informed the World Bank's executive board that it would neither support the creation of, nor participate in, the proposed energy affiliate. International petroleum company officials argue that, given favorable contracts, they are willing to undertake exploration and provide the financing for development almost anywhere in the world. The fact is that international agency participation can provide a substantial measure of security for the private petroleum companies by greatly reducing the likelihood of contract violations.