Canada is a global leader in oil production
In 2019, Canada produced 4.7 million barrels of oil per day (b/d), of which 94% came from producing areas in Western Canada. Total production is expected to increase to 5.8 million b/d by 2030. In 2019, Canada exported more than 3.7 million b/d to the U.S.
The developing world continues to need fossil fuels
Only fossil fuels provide low-cost, reliable, versatile, global-scale energy.
Unreliable solar and wind can't come close. That's why fossil fuels continue to grow in the developing world; China and India have 100s of coal plants in development.
Canada’s pension funds continue to invest in hydrocarbons
Canada's top five pension funds have increased their total investments in the country’s major oilsands companies by 147% compared to 2020. Many of the funds are avoiding blanket divestment action...
ESG starves cost effective energy of capital
A moral financial movement would do everything it could to increase capital for all cost-effective energy, including fossil fuels. And including nuclear, which is by far the most promising form of low-carbon energy. Instead, ESG is starving cost-effective energy of capital.
Global energy demand continues to rise
“Global energy demand is set to rise 19% by 2040, according to the International Energy Agency (IEA). This includes growth in both oil and natural gas demand, with oil and natural gas continuing to meet 54% of the world’s energy needs in 2040.”
The world needs low-cost, reliable energy
Low-cost, reliable energy enables billions of people to enjoy the miracle of modern machines that make us productive and prosperous. Yet 800M people have no electricity and 2.6B people are still using wood or dung for heating and cooking.
Divestment results in drops in endowment funds
A study commissioned by the Independent Association of Petroleum Producers found that the financial impacts of divestment action at universities leads to an average 15.2% drop in transfers from endowment accounts to school programs, translating to increased annual tuition rates, scholarship losses and reductions in faculty spending.
Reducing oil and gas production results in net job losses
“The [Biden] administration's focus on promoting green technology is important but will result in a substantial net loss of manufacturing jobs by reducing production of domestic oil and gas, and in turn chemicals, while subsidizing wind and solar products whose production is dominated by Chinese and European manufacturers."
Divestment comes with geopolitical risk
The divestment movement has just taken capital out of the most transparent and, arguably, most environmentally responsible segments of the global oil and gas industry
No one should be surprised when portfolio managers pay lip service to ESG investment criteria
If ESG investing truly maximized returns, fund managers wouldn’t fake a commitment to it while quietly doing their job—investing in companies that focus on shareholder returns and profits.