Lloyd’s should cease cover for Bahamas oil drilling project, says campaign group

Lloyd's of London building

A climate action campaign group has called on Lloyd’s to stop insuring a new project by the Bahamas Petroleum Company, which began exploratory drilling offshore from the Caribbean island in December 2020 as part of plans to open a new oil field.

Lloyd’s confirmed that it was insuring the project in January this year. SumOfUs, with the support of 30 climate change groups as well as individuals, said Lloyd’s shouldn’t renew insurance for the scheme as it is out of step and “entirely inconsistent” with its first ESG statement in December 2020, and “incompatible” with the Paris climate agreement.

Flora Rebello Arduini, senior campaigner at SumOfUs, said: “Lloyd’s says it wants to do its bit to fight climate change, but a reckless hunt for oil in pristine waters is the very opposite of that. We need to rapidly phase out fossil fuels, not go looking for more – and history will judge harshly those who stand in the way.”

Lloyd’s’ ESG statement said all syndicates should cease writing new cover for thermal coal-fired power plants, thermal coalmines, oil sands and Arctic energy exploration from 1 January 2022, and phase out renewals with existing clients by 2030.

NGO-backed Insure Our Future, which called out Lloyd’s for being the last major insurer to stop underwriting coal, said the ESG pledges are a “step in the right direction”. But it called on Lloyd’s to do more and bring forward the 2030 deadline for phasing out existing projects to 2021.

SumOfUs said Lloyd’s’ ESG report delivered a “weak coal policy” and “fails to mention oil and gas”.

It also called on Lloyd’s to exit insurance cover for other fossil fuel projects – including the Trans Mountain tar sands pipeline in Canada and the Adani Carmichael coalmine in Australia – to make them unviable.

Brit, AXA XL, Liberty Mutual, HDI, Aspen Re and Apollo have either stopped insuring the Adani Carmichael mine or pledged to exit on renewal.

SumOfUs said the Bahamas Petroleum Company has been met with local and global opposition to the new project, including appeals from 18 US senators.

Its open letter to Lloyd’s was supported by groups including Bahamas Reef Environment Educational Foundation, Campaign against Climate Change, Coal Action Network, Extinction Rebellion Australia, Green New Deal UK, London Mining Network, Oil Change International, Stop Adani South Australia, and Waterkeeper Alliance.