OSLO: Statoil's majority owner, the Norwegian state, will not ask the firm to get out of Canada's tar sands, killing a proposal at the upcoming annual general meeting to abandon the controversial oil project.
"There will be no intervention from the Norwegian government on Statoil's involvement in oil sands," Norway's trade and industry secretary Trond Giske told Norwegian daily Dagens Naeringsliv on Thursday.
"We have concluded that investing in oil sands is a decision that is not up to us as an owner. This is a decision for the company."
The Norwegian state owns 67 percent of Statoil's shares.
Green groups Greenpeace and the World Wide Fund For Nature (WWF) have for several years campaigned for Statoil to pull out of its Kai Koh Dehseh project in Alberta, which it bought in 2007 in order to diversify from its ageing North Sea oilfields.
Earlier this month the groups scheduled a motion for Statoil's AGM on May 19 calling on the company to avoid exploiting the Canadian soil saturated with bitumen. It was the third year in a row they did so.
They have the backing of several Statoil investors, including major Norwegian insurer Storebrand.
"Unfortunately the Norwegian government has decided to ignore a key issue in the climate debate, which is what resources it is possible to base our future energy production on," Rasmus Hansson, head of WWF Norway, told Reuters.
"The production and use of tar sands produce such massive amounts of greenhouse gas emissions that they will make it absolutely impossible to stay below the 2 degrees (increase in global temperature targeted by the UN)."
Canada's oil sands represent the largest crude reserves outside Saudi Arabia. That and the country's relative political stability have attracted Statoil and a host of other foreign investors.
But environmentalists are highly critical of the impact of development on air, land, water and local communities. (Reporting by Gwladys Fouche; editing by James Jukwey)
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