Arctic Oil Is Booming Despite Strong Opposition

Arctic oil and gas drilling is enjoying strong interest—and not just from Russian companies—despite the political rush to transform the world’s energy systems and remove fossil fuels from them.

A new report by Reclaim Finance, an organization that seeks to build a financial sector that will support the energy transition, has found that oil and gas companies had plans to increase their output in the Arctic by 20 percent over the next five years.

“These Arctic ‘expansionists’ – such as Gazprom, Total and ConocoPhillips – have, it is revealed, been backed by hundreds of billions of dollars of support from banks and investors, despite many holding commitments to restrict fossil financing in the region,” the report’s authors wrote.

The nonprofit said it had uncovered some $314 billion in funding for new oil and gas drilling in the Arctic distributed between 2016 and 2020, all from major banks and asset managers, most of whom have already made net-zero commitments.

Among the lenders to Arctic oil and gas, Reclaim Finance listed JP Morgan, which, according to the report, provided $18.6 billion in Arctic oil and gas financing, as well as Barclays, with $13.2 billion, and Citigroup, with $12.2 billion in financing for the oil and gas industry in its Arctic endeavors.

Private equity giants were also on the list with their holdings in the industry. The pack was led by BlackRock, which has holdings of $28.5 billion in companies with Arctic oil and gas operations. BlackRock, whose CEO Larry Fink recently said that a net-zero world is “the shared responsibility of every citizen, corporation, and government,” was followed by Vanguard, which has some $21.6 billion in exposure to oil and gas drillers in the Arctic, and Amundi, with $12.9 billion in oil and gas holdings in companies with Arctic operations.

“The Arctic is a climate bomb, and our research shows that the oil and gas industry is hellbent on setting it off, thus blowing up our chances of avoiding runaway climate breakdown,” the author of the report, Alix Mazounie, said.

“But they are not the only culprits: financial institutions have bankrolled these companies, making a mockery of their own climate commitments. Since the oil & gas tigers won’t change their stripes, the likes of BNP Paribas, BlackRock and JPMorganChase must heed the instruction of the International Energy Agency and cut off the taps.”