HSBC has helped to raise more than £37 billion for oil and gas companies despite its pledge to “no longer” provide finance for new oil and gas fields.
In December 2022, HSBC published a new energy policy which stated the bank would “no longer provide upstream finance (through lending or capital markets) for the specific purposes of new oil and gas fields and related infrastructure whose primary use is in conjunction with new fields.”
The bank said the decision had been made after “consultation with leading scientific and international bodies” and was based on the belief that the transition to net zero could be “more than met by existing known [oil and gas] fields”.
However, Analysis of Refinitiv data by The Bureau of Investigative Journalism (BIJ), as reported by ITV News, found that in the year since HSBC’s policy was announced, the bank has helped to raise more than £37 billion for companies that are expanding and investing in their fossil fuel production.
In the first half of 2023, HSBC and other banks helped United Arab Emirates’ state oil and gas company Adnoc raise £2.5 billion from selling shares in its gas and logistics business. It currently plans to expand oil production by 25% in the next four years.
The bank also helped to raise £950 million for Ades Holding, which provides oil and gas drilling rigs primarily to Saudi Aramco, the world’s biggest oil and gas producer.
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Additionally, HSBC was part of a group of banks that arranged loans worth £11 billion for two companies which are building Liquified Natural Gas (LNG) terminals on the Southern Coast of the US.
In a statement defending its actions, HSBC said: “We are committed to financing actions that will decarbonise today’s fossil fuel-based energy system while scaling the clean energy system of tomorrow”.
It added: “HSBC has stopped providing finance for the specific purposes of new oil and gas fields and related infrastructure, in line with what the science requires.
“It is wrong to suggest that our policies allow for financing that is at odds with a science-based net zero transition.
“HSBC’s approach is to engage with our major oil and gas clients on their targets and transition plans, and to align our oil and gas financing portfolio to a 2030 net zero aligned financed emissions target.”
