and Development, 2014–20

TABLE 2.2, continued

INSTITUTION OFFICIAL SOURCE OIL AND GAS FINANCING POLICY

Islamic Development Bank (IsDB) IsDB Energy Sector Policy (2018). No explicit restrictions on oil and gas financing, but “safety, operational efficiency and sustainability” are taken into account in upstream and downstream projects. Despite a goal to scale up renewable energy, IsDB has funded oil and gas and coal-fired power plants.

Sources: ADB 2009; AfDB 2011; AIIB 2018; EBRD 2018; EIP 2019; IDB 2018; IFC 2017, 2019; IsDB 2018. Note: FMR = flaring and methane reduction; gCO2/kWh = grams of carbon dioxide per kilowatt-hour; GHG = greenhouse gas. a. In May 2021, ADB published a draft energy policy on Supporting Low Carbon Transition in Asia and the Pacific (https://www.adb.org/documents /draft-energy-policy-supporting-low-carbon-transition-asia-and-pacific). The document is undergoing public consultation. b. ADB commissioned an independent evaluation that concluded that the current energy policy conflicts with ADB’s Strategy 2030 (ADB 2020).

TABLE 2.3 Flaring and methane reduction projects, European Bank for Reconstruction and Development, 2014–20

BORROWER COUNTRY YEAR SIZE AND INSTRUMENT DESCRIPTION

Intergas Central Asia JSC and KazTransGas Aimak JSC

Kazakhstan 2020 €244 million loan To help the subsidiaries of KazTransGas optimize the balance sheet, continue energy efficiency improvements, and develop a corporate governance action plan. The project description suggests that part of the loan will support the development of the Methane Emissions and Carbon Intensity Reduction Programme. KazPetrol Kazakhstan 2018a US$42 million loan Finance the implementation of AG use technology, including on-site power generation solutions.

Merlon Petroleum Egypt, Arab Rep. 2015 US$43 million loan Finance operations in Egypt, including investments to reduce AG flaring, and capital expenditures for field development.

Pico Oil and Gas Egypt, Arab Rep. 2015 Up to US$100 million loan The project has several components, one of which is the demonstration of new replicable activities by implementing a flaring reduction policy with best practices and new technologies.

Kuwait Energy Egypt, Arab Rep.

2016a US$100 million loan The project was supposed to support the development of Kuwait Energy’s Egyptian operations, including investments in AG flaring prevention and recovery. Falcon Kazakhstan 2014a US$20 million loan Fund capital expenditures and, in particular, the construction of an AG facility to eliminate all routine flaring at the Shoba oil field.

Source: European Bank for Reconstruction and Development, Project Summary Documents (https://www.ebrd.com/work-with-us/project-finance /project-summary-documents.html). Note: Information provided reflects publicly disclosed data and may not be an exhaustive list of projects financed or to be financed by the European Bank for Reconstruction and Development. AG = associated gas. a. Transaction was announced but not closed.

Going forward, the criteria for the financing of oil and gas projects, including FMR, may evolve—and possibly tighten—as development banks and DFIs review previously established common standards in this respect. In 2015, as a voluntary joint initiative, the members of the Multilateral Development Banks’ Climate Finance Tracking Working Group and the International Development Finance Club Climate Finance Working Group agreed on a set of Common Principles for Climate Mitigation Finance Tracking (World Bank 2015a).12 These principles were updated in October 2021 (EIB 2021) to reflect an enhanced ambition for reducing GHG emissions, taking into account new mitigation activities required to meet the goals of the Paris Agreement and excluding activities that, although reducing GHG emissions in the short term, may maintain highly emissive technologies for several more years, thereby undermining the long-term temperature goal. The use of associated natural gas from brownfields that would otherwise be flared as a feedstock or fuel to supply electricity, heat, mechanical energy, or cooling, when such use decreases GHG emissions substantially, as