Oil and gas companies plan to increase their extraction of fossil fuels in the Arctic by more than 20% over the next five years, in part thanks to the financial support they receive from the banking sector, according to a new report from Reclaim Finance. .
French company Total is ranked as the leading European energy company in oil and gas expansion in the fragile polar region – with production set to increase by 28% over the next decade.
But Russian energy giant Gazprom is considered the Arctic’s biggest predator, with 74% of its reserves based there.
Other energy companies with short-term expansion plans in the Arctic are the American ConocoPhillips, the Norwegian Equinor, the Spanish Repsol and Dutch Shell.
The Reclaim Finance survey, released Thursday, September 23, found that the vast majority of operations in the Arctic are funded by some of the world’s largest banks, including JPMorgan Chase, Citigroup and BNP Paribas and VTB Group, the Russian Sberbank and Gazprombank.
From 2016 to 2020, banks channeled more than â¬ 267 billion to companies expanding their production of gas and oil in the Arctic.
European banks are responsible for 25% of global underwriting and lending.
While most major financial institutions have some sort of Arctic restriction policy in place, the loose definition of âthe Arcticâ allows them to bypass their own exclusionary policies, the report points out.
Two European banks – BNP Paribas and HSBC – have even increased their contributions to oil and gas companies with extraction activities in the region, after adopting policies of exclusion from the Arctic.
But other financial players, such as investors, are also complicit in the arctic oil and gas boom, holding â¬ 232.1 billion in companies developing arctic oil and gas projects, according to the report. .
The results come just weeks before the much-anticipated United Nations Climate Change Conference (COP26) in Glasgow, Scotland, where leaders are expected to step up their climate commitments.
It is estimated that the Arctic lost, between 1979 and 2020, an area of ââsea ice about six times the size of Germany.
The report released by the United Nations Intergovernmental Panel on Climate Change this summer made it clear that “human influence is most likely the main driver of global glacier retreat and shrinking Arctic sea ice.” .
âThe Arctic is a climate bomb, and our research shows that the oil and gas industry is determined to unleash it, increasing our chances of avoiding unchecked climate degradation,â said Alix Mazounie of Reclaim Finance.
“But they are not the only culprits: financial institutions have financed these companies, mocking their own climate commitments,” he added.
The French NGO examining fossil fuel spending is now calling on financial institutions to step up their corporate policies to stop the expansion of oil and gas in the Arctic.
Earlier this year, the Paris-based International Energy Agency said that to limit the rise in global temperatures to 1.5 degrees, there could be no new deposits of oil and gas.
According to the report, there are 599 oil and gas fields in the Arctic, either in production, under development / appraisal or discovered.