Campaigners call for bond boycott on fossil fuel finance

Climate campaigners have said some of the world’s biggest energy companies will be seeking to finance a range of new fossil fuel projects in the coming months and have urged banks and financial institutions not to support any refinancing.

Updated data published on toxicbonds.org reveals that, as of September 2023, the group of companies dubbed by campaigners the “Dirty 30”, have over half a trillion in outstanding US dollar and Euro bonds. In the past year, over $8.5 billion in new bonds have been issued by the 30 firms. Now, these same issuers are facing a major tranche of fundraising with over 8% of outstanding bonds due to mature in 2023 and 2024.

“The Dirty 30 a notorious group of top 30 fossil fuel companies funding their expansion in the shadows of the bond market, is igniting a debt bomb,” Campaigners said in a statement. “In 2023 and 2024, these corporations will likely seek to refinance an astonishing $46 billion in maturing bonds to fund coal, oil and gas expansion and operations.”

Pemex ($6.5 billion), Shell ($5.6 billion), TotalEnergies ($3.7 billion) and ExxonMobil ($3.5 bill) are facing the largest amount in US dollar bonds maturing, respectively. While the Adani Group, will need to refinance over 23% of its US and Euro outstanding debt ($1.7 billion) by the end of 2024.

Nick Haines, Toxic Bonds campaigner at Ekō, said “Even as net-zero and transition plans receive greater scrutiny, the alarming truth is that fossil fuel companies are capitalising on the opacity of the corporate bond market to finance their coal, oil, and gas expansion. The world’s top fossil fuel expansionists will expect an easy rollover when the time comes to refinance over $46 billion in bonds over the next two years. Companies like the Adani Group and Glencore will serve as a litmus test for investors: will they deny new debt or continue to support companies engaged in coal expansion, deception and criminality?”

Campaigners claimed that despite the increasing number of commitments to cease lending to the fossil fuel industry, most banks continue to underwrite fossil fuel bonds, exploiting a common policy loophole. A recent investigation found that banks have helped fossil fuel companies raise over €1 trillion in bonds since the signing of the Paris Climate Agreement.

Will O’Sullivan, Climate campaigner at Banktrack, said “Banks prop up the Dirty 30 fossil fuel companies by underwriting their bonds. JP Morgan, Citi, Bank of America, and Barclays are the Dirty 30’s top gatekeepers to the financial world. The choice facing these banks is either to stop underwriting bonds issued by the Dirty 30 or continue down a path of complicity and – perhaps more importantly for banks – financial, fiduciary and transition risks.”

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