French lender BNP Paribas said Wednesday it will no longer do business with companies whose main activity involves shale and oil sands projects, a move taken to “accelerate” support of the worldwide energy transition to renewables from fossil fuels.
The boycott of unconventional players includes the end of project financing in the transportation or export of oil and gas from shale or oil from tar sands.
Additionally, the bank will not finance any oil and gas exploration or production in the Arctic region, Kallanish Energy learns.
“We’re a long-standing partner to the energy sector and we’re determined to support the transition to a more sustainable world,” said CEO Jean-Laurent Bonnafé. “As an international bank, our role is to help drive the energy transition and contribute to the decarbonization of the economy.”
The new measures will impact companies that explore, produce, distribute and trade unconventional hydrocarbons. Liquefied natural gas (LNG) terminal projects that predominantly liquefy and export gas from shale, or pipeline projects that primarily carry oil and gas from shale or tar sands won’t be financed by the bank.
BNP Paribas is committed to bringing its financing and investment activities in line with the International Energy Agency (IEA) scenario, which aims to keep global warming below 2o C by 2020.
“To achieve this goal, the world must reduce its dependence on fossil fuels, starting with oil and gas from shale and oil from tar sands, whose extraction and production emits high levels of greenhouse gases and has harmful effects on the environment,” said the bank.
Renewable energy projects are planned to receive €15 ($17.7) billion in financing from the group by 2020, while another €100 ($118.4) million will be allocated to start-ups specializing in energy transition, such as energy storage and efficiency.
BNP Paribas also has been cutting support to coal mines and coal-fired power plants.