PTR Petrochina Company Ltd

By Oliver Griffin

MP Pension, a Danish pension fund with $20 billion in assets, on Tuesday said it will sell its shares in 10 of the world's largest oil companies as it aligns its interests with those of the Paris Agreement on climate change.

The company said it will sell shares worth a combined 644 million Danish kroner ($94.8 million) it holds in companies including the U.S.'s Exxon Mobil Corp. (XOM) and Chevron Corp. (CVX), as well as European-based organizations like Royal Dutch Shell PLC (RDSB.LN), BP PLC (BP.LN) and Total SA(FP.FR).

The company said the combined stake represented more than two thirds of its oil equity investments.

MP Pension said it had assessed the companies, which include Russia's Rosneft Oil Co. (ROSN.MZ), Norway's Equinor ASA (EQNR.OS), and also companies in Brazil and China, and found that they aren't compatible with objectives as set out in the Paris Agreement, nor will they by the end of 2020.

As a result, the pension fund plans to sell its shares in the 10 oil companies, MP Pension said.

The news from MP Pension follows a decision in June by Norway's parliament to instruct the nation's $1 trillion sovereign-wealth fund to pull an estimated more-than $13 billion from oil, gas and coal companies. Instead, Norway's fund will pump up to $20 billion into renewable-energy projects and companies.

MP Pension sold its interests in coal and tar sands in 2018. Since then, the pension fund said, it has looked at how oil companies have performed in terms of the goals set by the agreement in Paris.

Fossil fuel companies that aren't performing in line with the climate accord have been cut, the company said, while those that are implementing strategies and designing their long-term business models to support the agreement are exempt from divestment.

MP Pension Chief Investment Officer Anders Schelde said his company had based its decision on an investment-related assessment of future returns of the sector.

"We [don't] believe that this sector can deliver a return on par with the rest of the market in the coming years. The demand for fossil fuels, including oil, will decrease as the green transition accelerates," Mr. Schelde said.

Write to Oliver Griffin at oliver.griffin@dowjones.com; @OliGGriffin

(END) Dow Jones Newswires

September 03, 2019 09:23 ET (13:23 GMT)

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