gas ‘crook’ banked by net zero lenders | Liverpool City Champion
Bankers have been accused of ‘industrial-scale greenwashing’ by funding a massive new gas field.
But National Australia Bank and Westpac insist they agree with the global push for net-zero emissions.
Woodside and BHP signed a $16.5 billion offshore LNG joint venture in November that will cement another 30 years of gas exports from Australia.
Woodside has now completed the sale of a 49% stake in the infrastructure that will process new onshore gas as part of a $5.6 billion expansion of the existing Pluto facility near Karratha in the region. from Pilbara in Western Australia.
Proponents say the eight-million-tonne-per-year Scarborough project will be one of the lowest-carbon sources of LNG for North Asian customers, with its 11.1 trillion cubic feet of gas.
Pluto Train 2’s first LNG shipment is scheduled for 2026.
Activist investor organization Market Forces says some of Australia’s biggest banks have been funding a “carbon bomb” at the scale of 15 high-emitting coal-fired power stations for three decades.
Activist Jack Bertolus told AAP that “industrial-scale greenwashing” also poses unacceptable risks to the fragile marine life and irreplaceable Aboriginal rock art of Murujuga, which is under study for the world heritage listing.
Ethical investors – large and small – are looking for truly sustainable and environmentally friendly places to place their capital.
Lenders and industry are eager to oblige.
“Climate action is everyone’s business. NAB wants to be part of the solution. We fully support net zero by 2050,” said NAB as a member of the global Net Zero Banking Alliance.
Certain groups, including market forces, are given a seat at the business table to share their concerns.
NAB, ANZ and Westpac are among 18 global banks in the consortium that have lent $3.486 billion ($4.85 billion) to specialist investors Global Infrastructure Partners (GIP) for a stake in the Scarborough to Pluto project.
In releasing the bank’s oil and gas policy in November, NAB chief executive Ross McEwan said he would limit fossil fuel lending.
But the bank reserved the right to support integrated liquefied natural gas in Australia, New Zealand, Papua New Guinea and some LNG infrastructure in other regions, below the oil exposure cap and on gas.
NAB does not comment on specific customers or transactions, but said it would align its loan portfolio to net-zero emissions by 2050.
“It’s the latest science that guides our methodology,” a spokeswoman told AAP.
NAB said it is training its bankers to ensure they understand this complex subject.
“We want the best climate bankers to support our clients,” she said.
“NAB has capped our oil and gas loans at $2.4 billion and we are the first Australian bank to do so publicly and transparently.”
The bank says the exposure cap will be reduced from 2026 to 2050, in line with the International Energy Agency’s net zero emissions scenario.
But this scenario also includes “no investment in new fossil fuel supply projects”, according to the agency’s executive director, Fatih Birol.
Mr Bertolus dismissed NAB’s oil and gas policy as an exercise in greenwashing that allows the bank to continue funding the expansion of the fossil fuel industry.
“Despite a clear commitment to net zero, NAB just led a global banking consortium to activate a 1.6 billion tonne carbon bomb, with ANZ and Westpac as part of the deal,” he says.
“The vastness of the fossil fuel project is matched only by the banks’ willingness to repeatedly defraud their customers and investors, all of whom are demanding action on the climate crisis.”
Westpac told AAP it supports a net zero economy by 2050 and was the first Australian bank to back the Paris Agreement in 2015.
“We will support our existing customers and work with them to ensure they have Paris-aligned business strategies,” a spokeswoman said.
“We also expect any new oil and gas exploration, production and refining customers to have publicly disclosed their Paris-aligned business objectives.”
The bank develops financing strategies and portfolio objectives aligned with Paris, in particular for sectors representing the majority of financed issues.
The project has also been the subject of legal challenges citing “staggering amounts of pollution”.
The Environmental Defenders Office, acting on behalf of the Conservation Council of WA, says the Scarborough development will result in 1.6 billion tonnes of carbon dioxide equivalent emissions over its lifetime.
Woodside boss Meg O’Neill described the project as a “world-class resource, a globally competitive project and a game-changer for Woodside”.
“The Scarborough gas development via Pluto Train 2 is expected to deliver significant value to our shareholders, create thousands of jobs and provide energy to domestic and international customers for decades to come,” she said. .
Ms O’Neill told analysts late last year that Scarborough was “a suitable investment from a decarbonisation perspective”, given the region’s remoteness from coal.
“With approximately 0.1% carbon dioxide in the reservoir and a new efficient LNG train at Pluto, it will be one of the low-carbon LNG sources delivered to Asia.”
ANZ says social, environmental and credit checks are used for any potential financing of large commercial customers.
“We have specific requirements for energy customers, in line with our Climate Change Commitment published in November,” an ANZ spokesperson told AAP.
“This includes supporting these customers with plans and commitments to reduce their impact on the climate, seeking to provide more financing to reduce emissions.”
He said ANZ aims to reduce the emissions intensity of its power generation loan portfolio by 50% by 2030, aligning loans with the Paris targets.
“We also aim to fund and facilitate $50 billion by 2025 to support our clients’ transition to a low-carbon economy, which includes renewable energy, ‘green buildings’ and emerging technologies. such as hydrogen.”
But an independent analysis of the Scarborough project in December found it “represents a bet against the world implementing the Paris Agreement” to limit global warming.
“The company’s arguments – that the project complies with the Paris Agreement – are incorrect,” Climate Analytics said in the report.
It was also not deemed consistent with the global move by businesses and many governments towards net zero emissions by 2050, or earlier.
“The Scarborough-Pluto project is not consistent at 1.5 degrees and is therefore a major stranded asset risk,” the analysts said.
The project was also found to result in a substantial increase in Western Australian emissions and a significant lock-in of carbon-intensive activity far beyond that of the LNG plant itself.
Much of the proposed emissions reductions for Scarborough will be achieved through offsets, including A$100 million Australia-wide Pluto LNG tree plantings, as well as energy efficiency in the design and operations.
“Carbon offsets are often used to launder fossil fuels, distracting attention from the critical need to rapidly reduce CO2 emissions from fossil fuels,” Climate Analytics found.
“Evidence suggests that offsetting CO2 from burning fossil fuels by planting trees is scientifically flawed.”
The WA Labor Government welcomes the thousands of jobs the massive project aims to create.
Australian Associated Press