Chevron open to sale of Canadian oil sands stake to meet green goals
CALGARY (Bloomberg) – Chevron CEO Mike Wirth signaled he would consider selling its 20% stake in a Canadian oil sands mine as its faces investor pressure to do more to curb emissions and fight climate change.
The oil producer’s stake in Canadian Natural Resources Ltd.’s Athabasca oil sands project generates “pretty good cash flow” without needing much capital “but I wouldn’t deem it a strategic position,” Wirth said at Bernstein’s 37th Annual Strategic Decisions Conference.
“We’re not in the kind of fire-sale mentality,” Wirth said. “But if we got what we think is fair value for an asset like that, we’ve been willing to transact on things that are of that scale and kind of relative importance in the portfolio.”
Oil sands are among the most challenged energy assets because of the volume of emissions created when producing crude from mines and from underground wells that require steam injection.
Facing increased pressure to cut carbon emissions, multiple international oil companies including Royal Dutch Shell Plc and ConocoPhillips have divested of their Canadian oil sands holdings in recent years.
Those pressures have only intensified in the past week. Chevron shareholders voted on May 26 in favor of a climate proposal to include emissions from customers’ burning of fuels in future reduction targets, against the wishes of the board.
Environment-focused activist investors are expected to win three seats on Exxon Mobil Corp.’s board of directors in a stunning rebuke to the company’s management. Shell was ordered to cut emissions more quickly by a European court last week.
The Athabasca project is a little more than 300 miles north of Edmonton, the capital city of Alberta.