BNP Paribas SA (ADR) (OTCMKTS:BNPQY) has announced that it has decided to stop financing Shale and tar sands groups as part of its new global financing policy.
The French bank made the recent announcement revealing its decision to no longer finance the shale and tar oil projects or work hand in hand with oil companies focusing on those resources. The announcement also said that a decision was made to terminate ties with oil and gas firms with exploration programs in the arctic. The new changes are part of the company’s effort to focus its attention towards tackling environmental change in support of renewable energy.
“We’re a long-standing partner to the energy sector and we’re determined to support the transition to a more sustainable world. As an international bank, our role is to help drive the energy transition and contribute to the decarbonisation of the economy,” stated Laurent Bonnafé the CEO of BNP Paribas.
Despite the announcement, the BNP Paribas CEO also stated that the French bank would continue to work together with energy firms that place environmental issues at the core of their business strategy. The French bank’s decision highlights the increasing concerns about the oil and gas industry’s impact on climate change. It also highlights the bank’s intention to make a positive impact.
Oil produced from tar sands have for a long time been the subject of environmental criticism because they contain more carbon compared to conventional crude. BNP Paribas’ decision might not create an immediate impact but it is certainly a start towards encouraging more efficient and environmentally friendly resources.
The French bank is one of the companies that have been spearheading the “green finance movement. It has plans to invest €15 billion ($17.7 billion) in renewable energies in the next three years. This is also in line with the French government’s push towards reduced carbon emissions after it hosted the Paris Climate Summit two years ago. The bank’s new financial policy is also working in line with the mission of the International Energy Agency (IEA) to keep global warming below 2 degrees Celsius in the next 100 years or so.
BNP Paribas stock closed the latest trading session on Wednesday at $40.01.