Abstract
Benefit sharing arrangements are a central element of the interactions between oil companies and local communities in resource regions of the Arctic and sub-Arctic. This paper focused on developing a systematic understanding and typology of benefit sharing arrangements within the oil sector in the Russian Arctic and sub-Arctic, using the Irkutsk Oil Region as a case study. It provided a critical analysis of prevalent arrangements and practices (modes and mechanisms of benefit sharing), as well as examined institutional and social underpinnings of these benefit sharing frameworks. Qualitative methodology with semi-structured interviews were used. The paper demonstrated that sub-Arctic communities are not equally benefiting from oil and gas extraction. Despite a considerable variety of existing arrangements revealed by this study, no benefit sharing mode or mechanism prevalent today ensures sustainable development of local communities. This may stem from the incompatibility between post-Soviet legacies, corporate social responsibility principles, and local institutional frameworks. Although focused on a particular region, this research was indicative of general benefit sharing patterns in modern Russia and beyond.
Highlights
Natural resource extraction in peripheral and remote areas is one of the few opportunities to bring economic development to these regions
We focus on the Irkutsk Oil Company (IOC) which is registered in Irkutsk, remains a major taxpayer in the region, and has specific benefit sharing arrangements with the Indigenous peoples and local communities
The Irkutsk Oil Region demonstrates a common combination of modes and mechanisms of benefit sharing in Russia, which are centered on paternalism and the centered corporate social responsibility (CCSR), and which are implemented through mandated, negotiated, and semi-formal structures embedded in the post-Soviet legacies (Table 3)
Summary
Natural resource extraction in peripheral and remote areas is one of the few opportunities to bring economic development to these regions Benefits of such development to local communities could be highly variable, and sometimes overshadowed by negative environmental and economic impacts. Examples include the ‘resource curse’ [1,2,3], inequitable profit distribution [4], displacement of vulnerable groups [5], and rise in criminal activity [6] These negative derivatives arise from the (neo) colonial model of resource development, where profits and benefits are directed to the extra-local companies, whilst local stakeholders receive a minimal share [7]. Sustainable development within resource regions, in the Arctic and Sub-Arctic, is embedded in equitable and just sharing of the benefits of extractive activities. A better understanding of benefit sharing arrangements in the context of global standards, national legal frameworks, corporate social responsibility, local conditions, and rights of the Indigenous peoples is needed to elucidate the nature of sustainable development processes, and its outcomes within the extractive regions [10]
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