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Alberta Touts ESG Credentials in Meetings With Foreign Investors

Alberta Touts ESG Credentials in Meetings With Foreign Investors

(Bloomberg) -- The Canadian Province of Alberta is stressing high production standards, security and democratic values in a bid to win over foreign investors who are increasingly focused on environmental, social and governance issues, according to Premier Jason Kenney.

“We’ll be challenging them to give us a great deal more credit for being the only stable liberal democracy among the largest oil producers in the world,” Kenney said in an interview at Bloomberg headquarters in New York Monday.

The conservative leader may visit investors in the U.K. and Germany this year and “probably” will carry out a trip to Asia next year. Kenney, who was elected in April, has recently been talking to U.S.-based institutional investors.

ESG ‘Boogeyman’

Alberta’s oil industry is facing greater scrutiny by investors focused on ESG, just as some of the province’s energy producers suffer financial stress because of lack of pipeline capacity to reach consumers in the U.S. The heavy oil produced from Alberta’s oil sands requires more carbon emissions to produce and refine than lighter alternatives, through producers have made progress in reducing emissions intensity and some projects are now on par with the average barrel of oil produced in North America.

“The Alberta oil sands have become a bit of a boogeyman in the ESG discussion, not based on any objective data, but frankly a political campaign,” said Kenney. “We’ve seen some institutional investors rate the Alberta oil sands very low on their ESG matrix while they continue to finance the Saudi, Iranian and Russian oil industries.”

Kenney said that ESG-focused investors should give more weight to social criteria and broaden their evaluation of what’s green. "The environmental should include conventional environmental conservation, not just CO2 emissions,” said Kenney, who served as a minister in former Prime Minister Stephen Harper’s federal government.

Kenney also stressed the security of Alberta in light of this weekend’s attack on oil facilities in Saudi Arabia, which hit about 5% of global capacity and triggered a record surge in oil prices. There’s “no more secure source” than Alberta oil sands, said Kenney.

The province’s executive plans to release in late October a fresh budget which will include a path to balance the books, according to Kenney. The province may look to issue a bond after that.

“We want the markets to see our path to balance,” said Kenney. “We think we’ll be in a good position to roll over some of our debt later this year.”

To contact the reporters on this story: Esteban Duarte in Toronto at eduarterubia@bloomberg.net;Kevin Orland in Calgary at korland@bloomberg.net

To contact the editors responsible for this story: Nikolaj Gammeltoft at ngammeltoft@bloomberg.net, James Crombie

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