Carney

UN climate czar Carney’s firm involved in North Sea oil field bid

The UN climate envoy, Mark Carney, is a senior leader at an investment firm which owns a key piece of infrastructure set to be used at a controversial new oil field in the North Sea. 

Carney — who was governor of the Bank of England between 2013 and 2020 — is the UN’s special envoy on climate action and finance. He joined Canadian investor Brookfield in 2020 as vice-chair and head of transition investing, where he leads “the firm’s environmental, social, and governance investing strategy”.

But a Ferret investigation has found that Brookfield — through a subsidiary called Altera Infrastructure — owns the floating vessel which will process oil from the proposed Rosebank oil and gas field off the coast of Shetland. 

Rosebank is the biggest field currently at the planning stage in the North Sea. Although it is yet to receive approval from UK regulators, it is expected to yield twice as much oil in its first phase as the much-maligned Cambo field,  which faced huge opposition from environmental activists in 2021. 

“He fails to acknowledge his responsibility for prolonging that system precisely by overseeing ownership of companies developing new oil fields at a time when science, economics, common sense – and Carney himself – say that we need to move swiftly to renewable energy.”

Beau O’Sullivan, of the campaign group Bank on our Future

Campaigners said The Ferret’s  findings “make a mockery” of Carney’s role as a UN climate figurehead. They also questioned how global climate leadership can be trusted to be “unbiased and sufficiently ambitious” when key leaders have such close links to the fossil fuel industry.

Both Carney and the Brookfield have previously defended the firm’s investments in polluting infrastructure. They pointed out that Brookfield has invested billions in renewable energy and claimed that their own “experience” of transitioning away from carbon-intensive sectors would make them “better owners” of assets in the fossil fuel industry.

Carney’s role at Brookfield was initially questioned last year after it emerged that the firm had major investments in five other fossil fuel infrastructure projects. These included projects in the oil sands and coal sectors, which are particularly damaging to the climate. 

It was announced earlier this year that Carney is set to take over as the chair of a new asset management arm of Brookfield by the end of 2022. 

Alongside his positions at Brookfield and the UN, Carney was Boris Johnson’s finance adviser at last year’s COP26 climate change summit in November 2021. 

He now also co-chairs the Glasgow Financial Alliance for Net Zero, which emerged from COP26 and aims at “bringing together the financial sector to accelerate the transition to a net-zero economy”.

Brookfield Asset Management is listed as the controlling party of Altera Infrastructure on Companies House. 

Altera is headquartered in Aberdeen and provides infrastructure –- particularly ships — for offshore oil and gas producers. It owns assets in regions including the North Sea, Brazil and Canada. 

“Mark Carney is getting his hands even dirtier through Brookfield’s involvement in the massive Rosebank oil field, in addition to their existing role in coal and tar sands projects, making an absolute mockery of his role as a UN appointed envoy on climate action.”

Ryan Morrison, a just transition campaigner at Friends of the Earth Scotland

The company signed an agreement for its Knarr Floating Production Storage and Offloading (FPSO) vessel to be used at Rosebank with the project’s operator, Equinor, in February 2022.

FPSOs are a crucial piece of infrastructure for new oil and gas projects. They are boat-shaped vessels which are a moveable alternative to a traditional offshore platform and are used to process and store oil until it can be transferred to a tanker and transported to shore for further refinement. 

The Knarr FPSO can produce 63,000 barrels of oil per day and has the ability to store a further 800,000 barrels. 

Equinor — which is owned by the Norwegian state — submitted an environmental statement for Rosebank to the UK Government at the start of August 2022. This is an important part of the process for gaining regulatory approval for a new oil and gas field. 

If it is given the green light, the project could be producing oil by the end of 2026. 

Rosebank is located 130km off the north-west coast of Shetland, close to Cambo, which was ‘paused’ by developers in December 2021 following opposition from green groups. 

Beau O’Sullivan, of the campaign group Bank on our Future, told The Ferret that Carney’s involvement with Brookfield was “flying in the face of his well intentioned words” on the climate crisis. 

“In August, Carney said that our current fossil fuel system is ‘unreliable, unaffordable, inaccessible and unsustainable’, crippling households with energy poverty”. He is right about that,” O’Sullivan said. 

“He fails to acknowledge his responsibility for prolonging that system precisely by overseeing ownership of companies developing new oil fields at a time when science, economics, common sense – and Carney himself – say that we need to move swiftly to renewable energy.”

Carney

Ryan Morrison, a just transition campaigner at Friends of the Earth Scotland, argued that opening up a new field like Rosebank was “pouring fuel on the climate fire that is engulfing the world”. 

Morrison added: “Mark Carney is getting his hands even dirtier through Brookfield’s involvement in the massive Rosebank oil field, in addition to their existing role in coal and tar sands projects, making an absolute mockery of his role as a UN appointed envoy on climate action.”

Tessa Khan, director of Uplift said: “It is beyond appalling that Mark Carney might be profiting off his firm’s investment in infrastructure that will play an integral role in Rosebank’s climate-wrecking production efforts. 

“How can we be expected to trust that climate leadership is unbiased, and sufficiently ambitious, when key figures still have ties to fossil fuel investments?”

Read more Ferret investigations into the oil industry here.

A spokesperson for Equinor argued that oil and gas will continue to play a “vital role” alongside low carbon technologies over the “next few decades”. 

They said: “While we still need oil and gas, we aim to develop and operate projects such as Rosebank with the lowest possible carbon footprint while bringing the maximum value to society in the shape of UK investment, local jobs and energy security.

“Equinor is committed to Net Zero by 2050 and is ready to invest to bring energy security while also transitioning to lower-carbon energy sources over the coming years.”

Equinor’s environmental statement points out that the FPSO could be fully electrified, which would significantly reduce the carbon footprint caused by producing the oil from Rosebank. This will not offset the climate impacts that will be caused by burning the oil and gas it produces, though. 

Brookfield, Altera and the UN have not responded to a request for comment by The Ferret. 

In response to previous criticism of Brookfield’s fossil fuel assets in 2021 a statement by Carney said: “I’m proud to have joined a company that has committed decades of experience and tens of billions of dollars to advance renewable energy across global electricity grids.

“At Brookfield, we are committed to going further in supporting the transition to net zero, including by managing our energy infrastructure investments to be consistent with the transition to a net zero economy, and we will implement science-based emissions-mitigation strategies across our portfolio of companies and assets.”

Image Credit: Press Association via The Herald

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