AdvertisementANZ will keep lending to the oil and gas sector

ANZ will keep lending to the oil and gas sector

Its new policy retains flexibility for ANZ to provide financing as mitigation plans are developed, and unlike the National Australian Bank, ANZ has not introduced a cap on public lending on top of the oil and gas sector, which Elliott said could lead to “wrong results”.

It will push customers to reduce emissions intensity to steer the economy toward net zero by 2050, via “new pathways to reduce intensity,” its briefing Friday provided details on these for the commercial real estate and power generation sectors, with oil and gas to follow.

ANZ provides more funding for large projects than other major banks and has been the main domestic funder of the Australian resource industry for decades. To meet the Paris targets, Elliott said the bank “may end up increasing exposure, which could mean that the direct emissions that we calculate from our customers could actually go up.”

But given growing pressure from investors and activists, ANZ has also made clear how it will take a tougher approach in deciding which expansion oil and gas projects it will undertake.

For all energy customers, ANZ said it wanted to see customers develop “specific, time-bound and general transition plans and diversification strategies.” New customers will need to satisfy the bank with their Paris-compliant plans before funding is available, while existing customers have them until 2025. ANZ said energy customers must stick to and disclose “Paris-compliant” business plans and report “transparently” on risks Climate and compatibility with Paris goals.

It said customers in the oil and gas sector should plan to capture and store methane in line with “methane guidelines.”

She wants to see oil and gas customers measure and disclose Scope 3 emissions from supply and value chains.

By setting new density reduction targets for the commercial real estate sector, ANZ said it will push clients to reduce business intensity by 60 percent by 2030; For power generation, the new target is 50 percent emissions intensity by 2030. It will follow Mr. Elliott’s targets for the oil and gas sector, and similar sliding paths will be developed for other carbon-intensive sectors in the future, in line with ANZ’s commitment to the Net-Zero banking alliance.

“We haven’t excluded them, but we’ve set higher standards” than existing projects that require additional funding, Mark Whelan, ANZ Bank’s corporate group CEO, said to new clients — and existing clients considering new ventures, such as Woodside.

“Their starting point should be much better than the current clients and our standards for them should be really high. We don’t rule that out, if we think it is in the interest of a better outcome for 2050, but those would be the exceptions rather than the rule.

Mr. Whelan said that if new customers were “bold to manage cuts in this area, we would take them into account.”

“I think they will be exceptions, not rules given the level of hurdle rate we will put in relation to them. We think this is an appropriate and practical way to support the transition to the outcomes we want to see by 2050.”

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