A Crown corporation’s financial support to the oil and gas sector came under scrutiny Tuesday as part of a new legal opinion outlining Canada’s obligations in responding to the climate crisis.

The legal opinion, written by a professor of law and environmental policy at the University of Cambridge and an environmental law expert barrister at London-based Matrix Chambers, says governments must take steps to stop their export credit agencies from providing financial help to oil and gas projects worldwide.

If they don’t, nations could eventually find themselves at odds with their obligations in principle under customary international law, as well as international human rights law, in keeping with the goals of the Paris Agreement and the UN’s climate change framework, said professor Jorge Viñuales and barrister Kate Cook on May 4.

Export Development Canada (EDC), which helps secure financing for companies to aid them in selling their products and services abroad, provided over $8 billion in support last year to the oil and gas sector, it has confirmed, and over $10 billion the year before.

EDC says it operates at arm's length from the government, that it has cut down on its lending portfolio’s exposure to high-carbon sectors in recent years, and complies with all the Organization for Economic Co-operation and Development’s (OECD) climate-related policies.

The agency also maintains that Canada’s oil and gas sector has a role to play in the low-carbon transition, including in helping support the development of “clean technology” that the government is hoping will slash Canada’s carbon pollution.

Viñuales and Cook’s legal opinion explicitly singles out EDC as representing the largest supporter among G20 export credit agencies of fossil fuels during the 2016-18 period. EDC’s climate change policy — and some criticism levied against it related to oil and gas — is also highlighted.

“If the extremely dangerous consequences of climate change are to be averted or, more modestly, their likelihood reduced, there is no room for additional fossil fuel capacity, and existing capacity or its emissions must be reduced urgently and proactively,” reads the opinion.

The opinion is international in nature and so does not consider how such international law considerations might be applied in the context of Canadian law. Oil Change International, the non-profit advocacy group that requested the opinion, said it now plans to study how the conclusions might fit with Canada’s domestic commitments.

In the meantime, the group’s research analyst Bronwen Tucker and Environmental Defence Canada climate and energy program manager Julia Levin have written to EDC's president and CEO Mairead Lavery, International Trade Minister Mary Ng, Finance Minister Chrystia Freeland and Environment Minister Jonathan Wilkinson to proactively ask them to “take steps towards adopting a policy to exclude fossil fuels from EDC financing.”

“Public finance for fossil fuel projects risks locking in high-carbon infrastructure for decades to come,” they wrote. “We urge you to take this opportunity to develop a policy that puts an immediate halt to support for fossil fuel projects and associated infrastructure, consistent with international law obligations.”

“Public finance for fossil fuel projects risks locking in high-carbon infrastructure for decades to come,” says a new legal opinion outlining Canada’s obligations in responding to the #ClimateCrisis. #Oil&Gas

The legal opinion comes several weeks after a commitment by Germany, France, Spain, Denmark, Sweden, the United Kingdom and the Netherlands to stop public export guarantees for the fossil fuel sector.

The European Investment Bank, the largest multilateral financial institution in the world, has also committed to ending its own fossil fuel financing by next year.

EDC spokesperson Anil Handa said the agency “unequivocally understands the urgency in addressing climate change” and has “gradually decreased support” to the oil and gas sector, down by 35 per cent from $12.5 billion in 2018.

The agency cut its lending portfolio’s exposure to high-carbon sectors by 15 per cent last year, and is now “identifying areas where we want to continue evolving our approach to the climate-related risks and opportunities of our business,” he added.

“We also understand the public’s interest in the support we provide to Canada’s oil and gas sector, which remains an important segment of our national economy and will need to play a role in the transition to a low-carbon future,” said Handa.

“It’s important to bear in mind that oil and gas companies are important partners for the cleantech sector, as they help support the development and commercialization of cleantech solutions.”

EDC provided $4.6 billion in total business support to “cleantech” firms in 2020, he said, representing an 80 per cent year-over-year increase.

Oil Change International has said G20 export credit agencies have provided US$40 billion annually for fossil fuels compared to just $2.9 billion for clean energy between 2016 and 2018.

Karen Hamilton, program officer with Ottawa-based Above Ground that examines the human rights impacts of multinational corporations based in Canada, said the legal opinion “makes it clear that export finance for oil, gas and coal might become the next target of climate litigation.”

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"“'We also understand the public’s interest in the support we provide to Canada’s oil and gas sector, which remains an important segment of our national economy and will need to play a role in the transition to a low-carbon future,” said Handa'."

In the first place, it's grammatically disoriented bafflegab. Parsing it gets ya: We undrstand public exposure in what we "lend" to Gas&Oil, still a big part of the nation's balance sheet and needing a role to play while they go broke and their funders (Canadian banks) call in the loans that can't be paid.

I keep asking why, and no one owns up. Why suck up to the oil-gas cos who've known the writing was on the wall for longer than you and I have, and done everything possible to obfuscate and hide the facts. Why are public pensions so heavily invested, and why are tney not divesting?

Or "We" *could* deploy the tried, tested and true technologies we already possess, and get us to where we want to go directly.