An Oslo-based pension fund will divest investments made in oil sands and coal extraction ventures, according to a new report by Pensions&Investments.
The $70.8 billion investment fund announced the decision on its website on Thursday, promising to remove from its roster companies that make 30 percent or more of their revenues from oil sands and coal extraction.
The companies that will barred from Kommunal Landspensjonskasse will be notified by June, but additional information on the size of the fund's current investments in fossil fuel firms were not available.
"The decision was made following a review of the climate and environmental risk related to unconventional oil and gas extraction. The climate and environmental impacts of oil sand extraction are as great as those for extracting coal. KLP will therefore extend the product-based exclusion criteria to oil sand," Anne Kvam, head of responsible investments at KLP, said in an official release.
"By also excluding companies in these sectors, KLP continues to direct its investments toward a low-emission society," CEO Sverre Thornes added.
Oil and gas investments on the Norwegian Continental Shelf are expected to drop for a fourth consecutive year in 2018, albeit at a slower pace than predicted earlier, according to industry group Norwegian Oil and Gas Association.
After 2018, investments are expected to tick up, to reach $18.3 billion (153 billion crowns) in 2019, and $19 billion (159.4 billion crowns) in 2020, before dropping off again in 2021 and 2022.
After the oil price crash in 2014, investments in the Norwegian petroleum industry in 2015 and 2016 dropped because companies cut costs, postponed some new projects, and completed major projects. The trends of declining investment levels are expected to level off in the coming years, Norway's oil industry authorities say.
By Zainab Calcuttawala for Oilprice.com
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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… More