Apple has all but thrown…
Crude markets closed below the…
The Norwegian sovereign wealth fund has banned both Cairn Energy and Kosmos Energy from its business portfolio due to the two companies’ decision to do business with the disputed Western Sahara.
The fund, valued at $870 billion, requires companies to meet certain criteria before acquiring an investment from the fund. The provisions exclude firms found to be causing environmental damage, making nuclear weapons, providing inadequate labor conditions and disrespecting human rights agreements.
The Sahrawi Arab Democratic Republic, a puppet government setup by the separatist Polisario Front, has been fighting for independence for the Western Sahara since 1975, when Spanish colonialists withdrew from the region.
Tensions between the United Nations and the Moroccan government have been high over the past few months after Secretary-General Ban Ki-Moon referred to the kingdom’s presence in the Western Sahara as an “occupation.”
Rabat expelled U.N. peacekeepers from the Saharan cities of Laayoune and Dakhla in early March as a political reaction to the international leader’s statement.
Norway’s Council on Ethics makes recommendations to the country’s central bank on investments and the companies included in the fund.
Related: Gulf Countries React To Brexit, Impact Of EU Departure On ME Oil
"The Council recommends the exclusion (of Cairn and Kosmos)… due to an unacceptable risk of the companies contributing to serious violations of fundamental ethical norms through their hydrocarbon exploration offshore Western Sahara,” the latest recommendation read. “The Council is of the view that no distinction can be made between exploration and exploitation activities in this context [and it] has not been satisfied that the operations take place in accordance with the wishes and interests of the local people.”
Kosmos released a statement disagreeing with the fund’s decision and claiming it had been working with Sahrawis to understand regional ambitions in regards to oil and gas exploration.
Cairn Energy also commented on its “disappointment” with the fund administrators’ decision.
Earlier this week, KLP, Norway’s largest pension fund announced a decision to exclude Petrobras after corruption scandals rocked the nationalized company and its associated government.
By Zainab Calcuttawala for Oilprice.com
More Top Reads From Oilprice.com:
Zainab Calcuttawala is an American journalist based in Morocco. She completed her undergraduate coursework at the University of Texas at Austin (Hook’em) and reports on…