Category change lets Oil Fund to increase ownership in Lundin

Although the Norwegian sovereign wealth fund was expected to divest from oil exploration companies in 2020 its ownership in a Swedish Lundin Energy increased as the company itself requested to change its category in FTSE Russell's index.

"This is not sustainable," says Kari Elizabeth Kaski of Norway's Socialist Left Party (SV) on the oil fund continuing to invest in a Swedish oil exploration company after its category at FTSE Russell's changed.

Norway's gigantic oil fund has increased its investments in a Swedish oil and gas exploration and production company Lundin Energy despite the Norwegian government's decision it would exit from oil exploration and production companies.

During 2020 the oil fund's ownership in Lundin not only persisted but increased from 1.3 to 1.6 percent because the company's category in FTSE Russell's index was changed in March from "crude oil producer" to "offshore drilling and other services", reports DN.

The first category is the one Norway's Ministry of Finance had decided in 2019 should be excluded from the fund. Lundin had asked for a change of category itself.

The Government Pension Fund Global is today Lundin's sixth-largest owner and holds shares worth NOK 1.2bn (EUR 118m).

Norway's Socialist Left Party (SV) now says that the mandate must be changed as the ownership of Lundin and the other oil producers is not in line with the purpose of the parliament's decision.

"This is not sustainable. We must make changes that will allow the parliament to reconsider this. (...) In the longer term, one must realize that this way of categorizing is not the solution," says Socialist Left Party leader Kari Elisabeth Kaski.

(This article was provided by our sister media, AMWatch)

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