HSBC and NatWest face backlash for their financial support of Ithaca Energy’s North Sea oil project, contradicting their environmental commitments and sparking criticism from over 80 organizations.
UK banks HSBC and NatWest have come under fire for their financial involvement with Ithaca Energy, a company engaged in the development of the Rosebank oil field in the North Sea, despite their commitments to cease funding new oil and gas projects. Between 2016 and 2022, these banks reportedly provided substantial financial support to Ithaca Energy, just as the UK government authorized Ithaca’s exploitation of the Rosebank field, which is located north-west of the Shetland Islands and estimated to generate 200 million tonnes of CO2 if its reserves are fully utilized.
Criticism has heightened due to the contradiction between the banks’ actions and their public alignments with environmental goals, particularly their membership in the Net Zero Banking Alliance which pledges to reach net-zero emissions by 2050. The financial support for Ithaca and its Rosebank project has come under scrutiny for potentially undermining efforts to combat climate change, in light of the International Energy Agency’s Net Zero by 2050 roadmap which underscores the need to limit global warming.
More than 80 organizations, including prominent groups like Greenpeace UK and Global Witness, have voiced their opposition to the banks’ support of Ithaca Energy. These campaigners have called for an immediate cessation of funding, arguing that involvement with Ithaca Energy’s North Sea oil and gas initiatives contradicts the banks’ environmental commitments and could tarnish their reputations.
Lloyds Bank, also previously implicated in funding Ithaca, has reportedly reduced its financial ties with the company. Meanwhile, HSBC and NatWest continue to face backlash for their ongoing financial relationships with Ithaca Energy as the debate over balancing economic interests with environmental responsibilities intensifies.
The Guardian, which sought comments from HSBC, Lloyds, and NatWest on the matter, has yet to receive any responses from these banks at the time of writing. The controversy highlights the growing challenge for financial institutions in aligning their investment strategies with global climate change mitigation efforts.
