* 94 percent of investors reject oil sands review
* 91 percent of investors back remuneration report
(Adds details of shareholder votes on oil sands, pay)
By Tom Bergin
LONDON, April 15 Oil major BP Plc (BP.L) on
Thursday easily beat off challenges to a Canadian oil sands
project and to its executive pay policy.
Europe's largest oil company by market value said 94 percent
of shareholders who voted in advance of the annual meeting
rejected a call to review its Sunrise project to squeeze crude
from Alberta's bitumen-drenched soil.
A group of shareholders including California Public
Employees' Retirement System (CalPERS), ethical investor
Co-operative Investments and a raft of environmental groups
tabled the resolution.
The group includes bodies that oppose oil sands production
in principle, because it emits more carbon dioxide than
traditional oil production, uses more water and involves greater
destruction to the landscape.
However, the resolution questioned the business on economic
terms, saying Sunrise could become unprofitable if governments
impose new charges for emitting carbon dioxide.
BP directors opposed the resolution, saying the company had
already factored in higher CO2 charges.
The oil major also feared that being forced to publish a
review of how it decided to invest in Sunrise, a joint venture
with Canada's Husky Energy (HSE.TO), could set a dangerous
precedent which would complicate future investment decisions.
Weak oil prices in 2009 sent some oil sands producers into
the red but crude has since recovered. Market predictions are
for prices of over $90/barrel in the coming years, compared with
a U.S. crude price of $86/barrel on Thursday.
Shell said this week that new oil sands projects offered
good returns at oil prices of $70-$75/barrel.
Few analysts believe CO2 emission charges will be high
enough to threaten the profitability of the business in the
"We doubt that either the Canadian or U.S. governments will
use this mechanism to attack an industry delivering an otherwise
low risk oil supply," analysts at Citigroup said in a report
published on Wednesday.
A RISK FOR ETHICAL INVESTORS
Oil sands projects could be bad news for ethical investment
The groups are loathe to exclude oil companies from their
funds as they can offer good returns, especially in a rising oil
However, fund managers will find it hard to market funds
that hold stakes in companies with oil sands investments, like
Shell, and BP, as socially responsible.
London-based BP also faced criticism from some shareholders
of its pay policies. Last week, influential corporate government
governance body Pirc recommended shareholders vote against the
In the event, over 91 percent of investors who expressed a
preference before the AGM, supported the report. Last year, more
than a third of investors voted against the report.
Attendees at BP's AGM general represent a small minority of
investors and so the votes published by BP reflect the vast
majority of those who will express a preference.
BP shares traded up 1.3 percent at 1439 GMT, slightly ahead
of a 1.2 percent rise in the STOXX Europe 600 Oil and Gas index
(Editing by David Cowell)