CALGARY — The largest pension fund in Norway has removed four Canadian energy names from its investment list and says it will no longer put money in companies that derive more than five per cent of their revenue from the oilsands.
The move comes as Norwegian state-owned oil company Equinor starts up the massive Johan Sverdrup offshore project, which is expected to produce 440,000 by next summer.
KLP says it sold US$58 million worth of stocks and bonds as it reduces its tolerance threshold for companies with interests in the oilsands from 30 per cent to five per cent, matching its limit for coal investments.
The fund says it will now exclude Calgary-based Cenovus Energy Inc., Suncor Energy Inc., Imperial Oil Ltd. and Husky Energy Inc. from investment consideration, along with Russia-based Tatneft PAO.
Shares in all four companies have fallen since a year ago as growth outstripped pipeline capacity, leading to steep price discounts and legislated production curtailments in Alberta.
Keith Stewart, senior energy strategist with Greenpeace Canada, says in an email institutional investors are continuing to abandon high-carbon investments because they “can see where the puck is heading.”
In a news release, the Norwegian fund which administers more than US$81 billion in assets says a full exit from the oilsands is “great news” for customers because that activity is not aligned with a two-degree Celsius global warming target.
“By going coal and oilsands free, we are sending a strong message on the urgency of shifting from fossil to renewable energy,” said KLP CEO Sverre Thornes in a statement.
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