With the oil industry continuing to invest heavily in projects all but assured to lose money as the world moves toward a lower-carbon economy, as a study published last week shows, investors may increasingly turn to shareholder lawsuits to protect their investments.

That study, by the financial think tank Carbon Tracker, said oil and gas companies invested $50 billion last year in projects that are incompatible with the goal of the Paris Agreement to limit global warming to well below 2 degrees Celsius (°C). Those investments could result in weak returns and investor losses as the world transitions to cleaner energy. The 18 projects highlighted in the report are expected to be “deep out of the money in a low-carbon world,” the authors said

“In making investment decisions, company directors are legally obliged to have regard to material climate-related financial risks, including stranded asset risk,” said Peter Barnett, an attorney with the nonprofit environmental law organization ClientEarth. “We expect to see much greater shareholder scrutiny, and indeed litigation, over large-scale investment in fossil fuel assets that will not be profitable in a low-carbon world.”  Read Full Article - Climate Liability News, September 12, 2019