UK banks are being asked to stop financing the company behind the controversial Rosebank oil field development, located northwest of the Shetland Islands in the North Sea.
Over 80 groups, including Make My Money Matter, Greenpeace UK and Global Witness, have written to the bosses of 12 big banks, like NatWest, Lloyds and HSBC. They want the banks to stop funding Ithaca Energy, an oil and gas company in the North Sea, which is spending billions on the Rosebank project with Norwegian oil giant Equinor.
A report called Banking on Climate Chaos's 2023 says that between 2016 and 2022, Lloyds gave $78 million (£61m), HSBC gave $60m (£47.0m) and Natwest gave $78m (£61m) to Ithaca Energy. The letter points out that most of the 12 banks are part of the Net Zero Banking Alliance, which means they've promised to stick to the Paris Agreement's goal of trying to limit global warming to 1.5C and move towards green energy.
HSBC, Lloyds and NatWest have publicly said they will stop directly funding new oil and gas projects. But this promise doesn't include corporate level financing to energy clients, who can then decide to use it to fund new projects themselves.
It's believed that Lloyds has no outstanding loans with Ithaca and sold down its debt facilities with the company in 2023. The letter referred to the International Energy Association's Net Zero by 2050 roadmap.
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This found that to meet the target, "no new oil and natural gas fields are required beyond those that have already been approved for development" with final investment decisions in 2021. Ithaca's final decision to invest in Rosebank was announced in 2023. The signatories said it was "clearly not aligned with limiting global warming to 1.5C".
They also said that the new project will increase Ithaca's carbon footprint and therefore those of the banks' financed emissions. The letter also asked the banks not to provide any future financing to Ithaca. This includes helping with capital market activities and providing advisory services.
The letter told chief executives: "Any future financing, including advisory services, to Ithaca Energy would expose your bank to significant risks if the company moves forward with the Rosebank field and other expansion projects. These include risks to the bank's reputation, possible legal and regulatory claims, as well as potential impact on investor expectations."
This comes as the Government has faced legal challenges in the Scottish courts after standing by the decision to give the go-ahead for drilling at the oil field.
Lauren MacDonald, from the Stop Rosebank campaign, said: "Rosebank is the poster child for North Sea oil and gas expansion, so why are these banks some of whom say they no longer support new fossil fuel projects providing billions to its minority owner, who has no plans to dial down oil and gas drilling? ".
"If the project goes ahead, it will emit more CO2 emissions than the 28 lowest income countries produce in a year combined, while Ithaca rakes in hundreds of millions. If these banks are serious about their climate pledges and tackling the climate crisis, they must stop this blatant greenwashing and cease financing Ithaca until it pulls the plug on Rosebank."
Henrieke Butijn, a climate campaigner and researcher at BankTrack, criticised: "Ithaca is a company that is purely focused on North Sea oil and gas and its expansion, with no interest in renewables. Banks that finance companies like this are making a mockery of their climate commitments."
"But worse than that, their finance is shattering our chances of staying below 1.5 degrees Celsius, and aggravating the impacts of climate chaos that especially communities of colour and those in the Global South already have to deal with every single day."
HSBC, Natwest and Ithaca Energy were contacted for comments.
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