Anthropocene Fixed Income Institute

 Who wants to run an inaugural bond deal for " one of the largest  exporters of seaborne thermal coal globally?" It seems BofA, Citi and  CMZB have appetite. 

 Recent statements from Fidelity around climate engagements are  important: as a key player in oil sands financing, the asset manager(s)  has outsized role to play in GHG emissions impact. 

 Global coal player Adani is looking to do a sustainability linked  bond: would it not be "cool" if the coupon-kicker was linked to the  construction of the Carmichael coal mine?  

Keystone XL has finally been cancelled. This is a supreme  opportunity to build credibility for ESG efforts for a lot of market  players. If they engaged, that is.  

 Private-equity owned Ameredev comes out as sector leading in terms of flaring of methane in the Permian Basin.  Who invests in the PE firm?

 Key stakeholders in Dalrymple Bay, one of the world's biggest coal  terminals, are arguing for a socialisation of clean up costs, seemingly  in the opposition of other external claims.  

  We are perplexed by the choice of PFA Pension to choose to be a  top international player (#2) in Province of Alberta oil sand funding.  

   When one of the world’s key oil sands players – Enbridge – go for a “sustainability linked bond” (SLB), it is hard to resist to do a deal review. When doing so, we are underwhelmed by some of the specific metrics, and startled by the audacity in general.    

   NAB gets called greenwasher by financial media due to its funding for the world's biggest coal export terminal, and Citigroup decides to take on a similar sole tier-1 lead in syndicating a USD450mn bond deal .  

  We review green bond issuer NAB's recent "sustainbility" loan to the Port of Newcastle and advice investors to review their exposure to NAB if they want to avoid coal financing. 

 We view a recent EPH €1bn loan deal as effective coal/lignite funding, which could be of concern for some the involved lenders (Citi, HSBC, Credit Suisse, ING, Unicredit, Commerzbank, Bank of China, SMBC and a local bank). 

   Korea National Oil Corporation has fully wiped out its equity. We analyze the credit scenario where the government lets the BlackGold tar sand project go and bets on the Blackpink COP26 trajectory instead.  Includes flash views on the KNOC/KOROIL bond transaction in the market. 

 KNOC is starting investor calls  on March 25 for a forthcoming bond transaction. Given the significant tar sand exposure of KNOC, we advice syndicating banks to make full disclosures thereof, and investors (especially the big Swiss ones)  to request a carbon footprint on behalf of KNOC. Seems pretty reasonable in 2021. 

 A portfolio company of private equity house EQT has entered into a joint venture with Adani Enterprises, one of the world's biggest coal players, to build power hungry data centres. Self-disclosure says "mostly powered by renewables", and we ask a few questions around that. 

Brookfield  looks set to launch a multi-billion dollar climate fund. And a coal  expansion making Dalrymple Bay into the world's biggest coal export  facility. If there were a word for such strategies

 We review intensified coal mine engagements, Myanmar coup  sanctions, potentially misleading carbon disclosure, and resistance to  syndicate new bonds as factors to take into consideration for ADSEZ bond  investors.  

 State Bank of India is using green credentials from multilaterals  like KfW, World Bank and EIB to detract from the Carmichael mega-loan.  Put a stop to it. 

 Biden's early decision to cut the Keystone XL pipeline project may  have implications for Vanguard's and NBIM's large bond positions in the  world's top oil sand producer, Province of Alberta  

 AFII makes the case for SBI refinaning of the bank's significant  USD near term maturities to be conditional on no Carmichael loan, and  review parallel lending practices in order to win green bond mandates,  with specific focus to SBI's 2018 green bond syndicate by HSBC among  others 

 The German coal decommissioning auction shuts 4.8GW of hard coal  power, and among them the Vattenfall Moorburg 1.6GW white elephant  project. Auction results and some reflections on the history of it.  

Given  a potential Carmichael loan from SBI, we review who are the main  banking transaction parties having exposure to such a -in our opinion-  greenwash. MUFG and HSBC come out on top.

 Media reports indicate that SBI is looking to provide USD650mn of fresh funding to Adani Enterprises and the Carmichael coal mine build. We think traditional bond investors, green bond investors and development banks should consider if the SBI's potential actions are in line with their climate targets. 

Aramco is looking to issue bonds again. We suggest ways to argue with portfolio managers who insist on buying such bonds, through how you can replicate the risk/return profile.

  The Dalrymple coal terminal is one of the world's biggest pieces of coal infrastructure and is being put up for sale by Canadian asset manager Brookfield. There is a lot to comment on as the process enters the retail marketing stage.   

The Canadian province of Alberta is one of the worst climate transgressors of the world. And still eligible for ECB liquidity support for they €4.5bn pool of EUR funding. That does not make sense.

25 October, 2020. 

The recent AUD1mn contribution on behalf of HSBC and the Queensland government to Great Barrier Reef conservation is not in proportion to QLD's role as a top global player in coal. We call it.

22 October, 2020. 

 Queensland green bonds are not credible as climate change mitigation instruments, as the state is on a buying spree to increase its dependency on coal.

29 Sep 2020.

 We review a number of broadly market traded issuers and securities in relationship to the enablement of the biggest greenfield coal development in the world. 

1 Sep 2020.

 The upcoming German hard coal decommissioning auction is giving  the chance for several European governments, through their controlled  subsidiaries, to get rid of coal exposure. What should be the tactics? 

20 Aug 2020.

Follow-up on earlier note covering recent stated linkages to the Carmichael mine, notch-up (!) of the ESG rating and other commentary.

7 Sep 2020.

 We  believe big coal does not deserve top ESG ratings or index inclusions.  We discuss this and the process of moving coal assets from the public  domain through delisting companies.  

3 Aug 2020.