By Steve Gelsi
Citigroup Inc.’s effort to change its dealings with Big Oil to measure how much pollution their activities produce before providing them with loans drew criticism from two environmental groups for not going far enough.
Advocacy groups Stand.earth and Amazon Watch said Citi’s new target to promote a 29% reduction by 2030 from 2020 in emissions in its energy loan portfolio falls short of a clear commitment to end financing for new fossil fuel projects.
In the report , Citi said stopping all loan business with oil-and-gas companies would be a last resort if they fell short of its disclosure and emission targets.
“Citi cannot call itself a climate leader as it continues to pour direct financing into oil and gas expansion projects in critical biomes like the Amazon,” said Pendle Marshall-Hallmark, climate and finance campaigner at Amazon Watch, in a statement on Thursday.
The group said Citi currently ranks as the top financier of state-owned oil companies in the Amazon, as one of the only U.S. banks providing loans to PetroEcuador, which aims to double oil production in the region.
Citi also provided a $1.3 billion loan to PetroPerú for the Talara Refinery, which has drawn opposition from the Wampis Nation, the group said.
Citi also maintains ties with Brazil state-run oil giant Petrobras through $1 billion in loans as it further develops offshore gas projects that remain “incompatible with calls to immediately end fossil fuel expansion, and endanger the Great Amazon reef system,” the group said.
Marathon Oil /zigman2/quotes/205031829/composite MRO +2.87% and Chevron /zigman2/quotes/205871374/composite CVX +1.66% rank as two of Citi’s top clients and also tip the scales as two of the largest crude oil refiners in the Amazon.
Tyson Miller, Amazon campaign director at Stand.earth, reiterated a plea to Citi to end funding of oil expansion in the Amazon and other regions of global concern.
Citi did earn some praise for plans to track “absolute” emission targets from oil and gas borrowers in the Amazon as a “step toward accountability,” the groups said.
Other U.S. banks such as JPMorgan Chase & Co. /zigman2/quotes/205971034/composite JPM -0.64% and Goldman Sachs Group Inc. /zigman2/quotes/209237603/composite GS -0.72% currently use the less stringent “intensity” targets for oil companies.
The groups said Citi has agreed to a two-year grace period before engaging with its largest clients such as Exxon Mobil Corp. /zigman2/quotes/204455864/composite XOM +1.75% and Saudi Aramco, despite calls from group such as the Intergovernmental Panel on Climate Change for an immediate end to fossil fuel expansion.
Citi’s report reiterated its aim to achieve net-zero carbon emissions associated with its financing by 2050, which matches most pledges in the financial-services space.