For Immediate Release
Stefanie Spear, firstname.lastname@example.org, 216-387-1609
Chevron-Anadarko Acquisition Signals Coming Changes in the Oil & Gas Industry
WASHINGTON - Chevron announced Friday an intent to acquire Anadarko Petroleum, an exploration and production (“E&P”) oil and gas company. The Chevron-Anadarko deal comes at a time when climate-related concerns are raising hard questions about the oil and gas industry. As climate change reduces demand for oil and gas, increases competition from lower-carbon, lower-cost energy sources, and fosters protective climate regulations, companies focused only on oil and gas production are beginning to feel the heat. Last month, Government Pension Fund Global, the giant Norway sovereign wealth fund, announced an intent to divest itself from a list of exploration and production companies citing growing climate risk associated with these companies.
“This acquisition may signal a larger wave of consolidation and retrenchment in the oil and gas industry,” said Andrew Behar, CEO of As You Sow. “A similar pattern was seen in the coal industry prior to a wave of coal company bankruptcies, as challenges from lower-cost energy sources and climate-based market changes signaled the demise of coal for power generation.”
“We question Chevron’s decision to acquire more oil and gas resources at a time when we would expect a focus on energy diversification from the company,” said Danielle Fugere, president of As You Sow. “Shareholders are asking oil and gas companies to align with Paris goals of net-zero carbon emissions by 2050, so acquiring more fossil fuel reserves, rather than aligning with a clean energy future, seems to be a short-sighted approach, not a deal that is likely to add long-term value to Chevron's shareholders.”
As You Sow has filed shareholder resolutions this year with Chevron and Anadarko, to be voted on at upcoming 2019 annual meetings, calling for a Paris compliant transition plan at each company. The global consensus of the Paris Agreement to limit climate change to well below 2 degrees Celsius necessitates that fossil fuel companies keep 2/3 of their reserves in the ground, according to the International Energy Agency.
Other oil and gas companies have taken a different approach. Shell is leading in diversifying its energy products, setting targets to reduce Scope 3 emissions, and linking executive compensation to achieving sustainability goals.
For more information on As You Sow’s work on energy, click here.
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