It is a brief financial press release looking like an announcement, sent on April 26. Var Energi “is pleased to announce” there raised 600 million euros to finance its activities. What the Norwegian oil and gas company does not specify is that several good fairies assisted it, notably four French banking groups: Crédit Agricole, Société Générale and Natixis, which co-organized the transaction, as well as BNP Paribas, which played an administrative role.
Working with Var Energi, a company whose activity is 100% focused on fossil fuels that emit high levels of greenhouse gases, seems contradictory with the banks’ commitment to helping achieve the objectives defined by the Paris agreement. . This collaboration is however authorized by their climate commitment charters, since it takes the form of an issue of financial bonds: the banks do not lend their money directly, they simply assist the energy company at several levels to which it borrows from private investors. This is called indirect financing.
The world collaborated with around ten European media, including Investico, Follow the Money And The Guardian, to lift the veil on this little-known aspect of fossil fuel financing. The conclusion of our investigation, called “ Fossil Finance “, is clear: when a gas or oil giant collects hundreds of millions of euros through financial obligations, European banks are almost always involved.
More than 1,000 billion euros since 2016
In December 2015, the Paris Agreement recognized the urgency of drastically reducing greenhouse gas emissions around the world. However, funding for fossil fuels has not dried up since. Between January 2016 and June 2023, no less than 1,011 billion euros were raised by 307 major polluters who are continuing to expand their fossil fuel activities, thanks to the issuance of 1,666 “gray” bonds. This windfall represents almost half of the sector’s financing, the rest coming from direct loans.
While it is common to place sole responsibility for this financing on Asian and American banks, European establishments are at the heart of this market: 776 billion euros, or 77% of the total, were financed with the help of at least one of them, almost as much as for their American counterparts (801 billion). French establishments (Crédit agricole, BNP Paribas, Société Générale and, to a lesser extent, Natixis) are among the most active in Europe in this regard: they are involved in a little more than half of the transactions (52%).
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