Environmental group sends legal warning to pensions over potential LNG investments

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Environmental advocacy group Stand.earth has enlisted a high-profile law firm to warn six major pension funds against investing in liquefied natural gas megaprojects, saying climate-related and other risks could expose plan administrators to legal action.

CALGARY — Environmental advocacy group Stand.earth has enlisted a high-profile law firm to warn six major pension funds against investing in liquefied natural gas megaprojects, saying climate-related and other risks could expose plan administrators to legal action.

The letter from Anne-Julie Asselin, partner at Trudel Johnston & Lespérance, was sent last week to trustees of the Canada Pension Plan Investment Board, Public Sector Pension Investment Board, Ontario Municipal Employees’ Retirement System, Ontario Teachers’ Pension Plan, University Pension Plan and Healthcare of Ontario Pension Plan.

Montreal-based Trudel Johnston & Lespérance specializes in class action and public interest cases, including a decades-long legal battle against major tobacco companies that resulted in a $32.5-billion settlement approved last year, as well as an ongoing fight against opioid makers. Lawyers at the firm were also involved in a lawsuit over the defunct Energy East pipeline’s potential impact on whale habitats in the Gulf of St. Lawrence.

“As the financial risks associated with fossil fuel investments become more significant, more foreseeable and better understood, prudence demands an increasingly rigorous assessment of those investments,” Asselin wrote in the letter. “Disregarding such risks becomes more difficult to justify and may carry legal consequences.”

She urged pensions to “refrain from investing, either directly or via a private fund, in LNG Canada, Ksi Lisims LNG or comparable Canadian LNG projects unless and until it can demonstrate, on the basis of a rigorous and transparent assessment, that such investments are consistent with its statutory and fiduciary obligations.”

Stand.earth and its legal counsel had the letters drafted and ready to send when news broke last week that four pension funds plan to invest in LNG Canada.

U.S. asset manager Blackstone is leading a group, which includes CPPIB, OMERS, the Investment Management Corp.

Asselin said it’s not clear how final…

“We…

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