Swedish Pension Fund Disinvests from EOG, MEG Citing Lack of Climate Plans

Swedish state pension fund AP7 has blacklisted EOG Resources Inc. and MEG Energy Corp. accusing them of extracting fossil fuels on a large scale without energy transition plans.

It has now excluded 110 companies from its investment portfolio. AP7 expanded its blacklist criteria, which also targets firms involved in nuclear weapons, in December 2016 to include the Paris Agreement. The COP 2015 accord, which took effect November 2016, aims to limit the rise in the global temperature to 1.5 degrees Celsius relative to pre-industrial levels.

EOG has been added to the blacklist for “acting against the targets of the Paris agreement through large-scale oil operations without transition plans”, AP7 said in an online statement.

The Houston, Texas-based oil and gas exploration and production company had proven reserves of 4.5 billion barrels of oil equivalent (boe) as of yearend 2023, mostly in the U.S. Trinidad and Tobago accounted for 51 million boe, according to EOG’s annual report. It is also involved in Australian exploration.

MEG has been added for “acting against the targets of the Paris agreement through oil sand operations without transition plans”.

The Calgary, Alberta-based producer held about 1.94 billion barrels of proven and probable reserves as of December 2022, according to online data from the company. Operating in the Athabasca region, it says it is the biggest pure-play in situ thermal oil producer in Canada.

Neither EOG nor MEG responded to requests for comment emailed by Rigzone. EOG and MEG have set net-zero targets by 2040 and 2050 respectively.

Meanwhile in AP7’s latest blacklist update, Japanese equipment manufacturer Hitachi Zosen Corp., renamed Kanadevia Corp. this year, and German manufacturer of carbon-based solutions SGL Carbon SE have been removed from the blacklist due to “the lack of verified information about ongoing violations by the companies”, AP7 said.

AP7’s climate-related blacklist initially focused on coal companies. “In 2022, the requirements were tightened with the blacklisting of companies without transition plans with large-scale coal operations or oil sands extraction”, it said. “During 2024, AP7 has continued to evolve the criterion to include the largest oil companies without transition plans, which are thus deemed to act in violation of the Paris Agreement.

“In 2025, the review will be extended to cover more oil companies”.

The pension fund explained, “AP7 invests in the companies that in an acceptable way act according to the requirements of the international conventions that Sweden has signed, and which are expressed in the UN Global Compact’s ten principles, which describe companies’ responsibility for human rights, working conditions, the environment and anti-corruption”.

“The blacklisting is an engagement tool in collaboration with other engagement tools such as company dialogues and voting at general meetings”, it said.

To contact the author, email jov.onsat@rigzone.com