
Norway's largest pension fund KLP exits oil sands companies - reddotX
https://www.reuters.com/article/us-norway-klp-investment/norways-largest-pension-fund-klp-exits-oil-sands-companies-idUSKBN1WM0E0
======
TeMPOraL
Ah, oil sands. I've recently learned about the environmental issues
surrounding them, and their existence makes any kind of complaining about
dangers of nuclear waste completely ridiculous and/or disingenuous.

Just take a look at e.g.
[https://energyeducation.ca/encyclopedia/Oil_sands_tailings_p...](https://energyeducation.ca/encyclopedia/Oil_sands_tailings_ponds)
; apparently creating city-sized lakes of badly contained, liquid,
ridiculously toxic, harmful for thousand years sludge is somewhat
unremarkable, whereas replacing some of that demand with nuclear can't happen
because of orders of magnitude less volume of much easier to handle (and
reprocessable in the future) waste is somehow a show-stopper.

~~~
hanniabu
> whereas replacing some of that demand with nuclear can't happen because of
> orders of magnitude less volume of much easier to handle (and reprocessable
> in the future) waste is somehow a show-stopper

I don't think the main issue is with the nuclear waste. It's with the fact
that even though it's possible to build and operate safe nuclear plants, human
nature gets in the way and prevents that from happening.

~~~
WalterBright
> It's with the fact that even though it's possible to build and operate safe
> nuclear plants, human nature gets in the way and prevents that from
> happening.

People have managed to do that with airliners, even though flying at 30,000
feet in -40F temps, insufficient oxygen, in a tin balloon filled with gas has
nothing inherently safe about it. And yet airline travel is incredibly safe.

I.e. since we can make that safe, we can do that with reactors.

(For contrast, ever wonder how the US got the B-17's to England during WW2?
The combat crews, as their first job, flew them there across the Atlantic. My
dad (B-17 navigator) said more than a few took off from Newfoundland and were
never heard from again. After the war they came back on a ship. Lindbergh came
back on a ship, too.)

------
patfla
KLP (according to Reuters) is the largest pension fund in Norway? Who anyway
is KLP?

[https://www.google.com/search?client=firefox-b-1-d&q=norway+...](https://www.google.com/search?client=firefox-b-1-d&q=norway+klp+pension+fund)

I see: public employees. Public employee pension funds, in the West, are often
some of the largest by country.

Norway's actual largest pension fund, the so-called Oil Fund, is, at > $1
trln. in assets, much larger.

[https://en.wikipedia.org/wiki/Government_Pension_Fund_of_Nor...](https://en.wikipedia.org/wiki/Government_Pension_Fund_of_Norway)

It's the largest sovereign wealth fund in the world and owns 1.5% of the
world's "stocks and shares" (as Wikipedia puts it) - it's a behemoth.

And how did Norway accumulate all that wealth? North Sea oil.

Whenever I hear "responsible this and that" from Norway, I chuckle. The
ironies are rich. It's all fine and good to be responsible this and that once
you're as wealthy as Croesus. With a population of 5.26 mln. people, it's sort
of like a reasonably sized global metropolis came into a fortune well in
excess of a trillion $. Bring on those Teslas.

~~~
eesmith
Nice derailing there!

The thing about Norway is that they were responsible before they were as
wealthy as Croesus.

Where did the UK North Sea oil profits go?

Where do the US oil profits go?

Just what do you think a responsible fund should do, significantly beyond what
Norway does?

~~~
ChrisLomont
>Where did the UK North Sea oil profits go?

>Where do the US oil profits go?

Norway: 5 million people, and 1 trillion dollars in it's oil fund, most of
which was from oil profits.

UK: 66 million people. North Sea profited around 1.1B in 2018. It would take
1000 years of this to match Norway, and 12,000 years to do it at per capita
rates.

US: 327 million people. In 2018 [1], total US net oil profits were 28B, which
was a good year. To match Norway per capita would take 2200 years of profits.

It's easier to set up a sustainable fund when revenues per capita are orders
of magnitude larger.

[1]
[https://www.eia.gov/todayinenergy/detail.php?id=39413](https://www.eia.gov/todayinenergy/detail.php?id=39413)

~~~
NeedMoreTea
2018 is at the tail of dwindling UK North Sea revenues. Peak is long past. The
UK could have achieved a fund with roughly comparable contributions to Norway,
but obviously across a far higher population. UK and Norwegian production
across the years of North Sea exploration has stayed pretty close to each
other.

 _In theory_ with UK production ramping up a little earlier in the seventies
than Norway, the same investment choices would have made a UK fund slightly
larger than Norway's.

From a national perspective it would have been the much better choice to
create a national fund in the sixties or seventies, rather than piss it away
on nothing as the government actually did.

~~~
ChrisLomont
>The UK could have achieved a fund with roughly comparable contributions to
Norway,

If the state took control of all oil revenues, then perhaps. But historically
countries with the govt taking over such production have not done as well as
those with private enterprise. Norway did well. Venezuela not so much. Middle
East not so much.

>From a national perspective it would have been the much better choice to
create a national fund in the sixties or seventies,

How has that action played out across all countries that tried it? Picking one
after the fact that did well while ignoring cases where that action didn't do
well is not a good way to push future policy.

~~~
NeedMoreTea
> If the state took control of all oil revenues

No. Norway's oil fund is the surplus from _oil taxes_ and _exploration
licences._ Doesn't need 100% nationalisation, Venezuela or a command and
control Supreme Soviet.

The UK Energy Minister proposed a national fund in the sixties, the Treasury
agreed, but he was overruled by Cabinet. The remnants of the British National
Oil Corporation that was going to be responsible for licences and supply was
sold off at _huge_ discount as BritOil in the depth of a recession (now part
of BP).

> Picking one after the fact that did well

Or we could simply look at what the UK _actually did_ with the oil dividend.
Then conclude that _anything_ else would have been better for the UK. A
national fund with _zero_ growth or investment. A fund that makes a 20% loss
every year. Simply spend it all on modernising infrastructure every year.
Better still, a national fund with a conservative growth strategy. Ideally
split between a global fund (the $1.1tn) and a national fund, as the
Norwegians did.

Per capita not nearly as much as Norway's $200k each certainly, but $20k per
person is hardly chicken feed. Whatever, we'd be _far_ better placed for what
comes after the oil. Or have $1.2tn+ to decarbonise the whole economy. Or take
some of the load off funding state pensions into the future, with an ageing
society...

The USA could have achieved a phenomenal fund over the far longer period of US
extraction - started in what, the 1890s, who knows what absurd valuation could
have been achieved by now. Or the benefits that would bring to pensions or
infrastructure.

------
mikhailfranco
It seems perverse for Norway (pensions or SWF) to invest in fossil fuels of
any kind. They have oil, so other investments should be at least diversified
away from oil, or optimally with some significant element of renewable energy.
In that way, they can stabilize future returns to the whole country and reduce
the financial risk of a political escalation against carbon.

------
gruez
Relevant post from a few weeks ago:
[https://news.ycombinator.com/item?id=20998948](https://news.ycombinator.com/item?id=20998948)

------
hapless
Easy to divest when, right now, all of them look like pretty bad investments.

~~~
newguy1234
You want to divest from an investment before it becomes a horrible investment,
not after it has lots most of its value.

~~~
protomyth
I get the feeling this comes under "cut your losses".

