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Leading investor group toughens stance on new upstream oil and gas
projects
By Virginia
Furness
March 29, 2023
![](images/images_04_03_2023/pic6.jpg)
Oil derricks are seen at the Kern River oil fields, in
Bakersfield, California, U.S., January 24, 2023. REUTERS/Mike Blake
LONDON, March 29 (Reuters) - The Net Zero Asset
Owner Alliance (NZAOA) said on Wednesday it expects members to make no
new direct investments in upstream oil and gas infrastructure projects
for new fields, as part of efforts to rein in global warming.
The group, whose members control $11 trillion in assets, said the
requirements are its most stringent yet and reflect a scientific
consensus that plans to transition
the global economy
away from fossil fuels must accelerate.
The requirements form part of a position paper laying out expectations
for members, companies, investors and policymakers on everything from
stewardship to carbon pricing, providing a roadmap for the global
economy to wean itself off oil and gas.
The Alliance is also calling on companies in the oil and gas sector,
as well companies that use the fuels, to set science-based targets to
reduce their carbon emissions and to implement transition plans, as
the world strives to limit global warming to no more than 1.5 degrees
Celsius above pre-industrial levels.
The targets should cover not only a company's direct emissions, such
as a diesel generator on an offshore platform, but also those related
to its own energy use and those related to its customers' use of its
products.
Despite that, climate-focused non-profit organisations including
Reclaim Finance, Global Optimism and WWF said the guidelines were not
ambitious enough.
"This position should have gone further in explicitly setting
expectations for companies that are as clear as the expectations for
investors... no investment in new oil and gas fields or other
carbon-intensive infrastructure," said Christiana Figueres, founding
partner of Global Optimism and a strategic advisor to the Alliance.
Reclaim Finance said there was no room for investment in new oil and
gas fields in a 1.5 degree scenario and called the proposal "a giant
leap backward".
The world's top oil and
gas companies have so far set
varying targets to
reduce greenhouse gas emissions from their operations and the use of
the products they sell.
"What the paper is really doing is not placing the blame on one
stakeholder but pointing to the whole ecosystem and all the actors
that need to be moving in parallel in order to raise ambition and get
us on track for 1.5 degrees," said Patrick Peura, ESG engagement
manager, Allianz Investment Management and co-lead of the Alliance
engagement track.
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