Piura is a coastal region in north-western Peru. It is home to the second largest refinery in the country, Talará, owned by the national oil company Petroperú.
In Peru, the government's income from oil, gas and mining operations is distributed to Piura and other regions according to a set of complex formulas. Nearly half of all revenues from the extractive industries is dispersed from the central government to local and regional levels. A total of US $250 million was distributed to municipality governments, the regional government and local universities in Piura.
The EITI multi-stakeholder group in Peru realised it was important to ensure transparency and oversight of these revenues at the local level, and to verify that regional institutions received what they were due. The regional government of Piura volunteered to pioneer a regional EITI "pilots".
In May 2014, the Government of Piura formed a Piura EITI multi-stakeholder group with representatives from the regional and municipal governments, extractive companies, and from a wide spectrum of civil society organizations including universities and professional bodies, farmers and environmental organisations. Three municipalities, out of eight in total, volunteered to disclose detailed accounts of what they have received from central government.
Stakeholders worked swiftly in 2014 to prepare for the first disclosures in line with the EITI guidelines. Their first report is set to be released in mid-2015, and will review all cash transfers in 2012 and 2013. This report will reconcile the transfers as reported by the central government with what local governments report to have received. This will allow citizens in the region to verify that their local government and institutions actually received what they were due.
The EITI in Piura will also assess whether local governments have invested and spent the extractives revenue according to their development plans.
Violeta de Herrera, mayor of one of the participating municipality, Castilla, said:
When the regional government invited us to participate we immediately said yes. We look forward to having an instrument to making transparent what we receive from royalties and how we spend it. It is very important for us to give citizens reliable information to allow then to be an effective part in the participatory budget process.
EITI-Piura has a supporting unit hosted by the Planning and Budget department at the regional government. The multi-stakeholder group has met regularly since May 2014, and has focused on explaining how citizens can understand and trace the flow of revenue from extractives industries.
Other regions in Peru, Moquegua and Loreto, have initiated local EITI implementation and expect to learn from the experiences in Piura.