Saudi oil giant Aramco unveils $1.5B sustainability fund

Saudi oil and gas company Aramco unveiled a $1.5 billion fund on Wednesday for sustainable investments, part of efforts to burnish the state-owned company's green credentials in an announcement ahead of the U.N. climate conference next month in Egypt.

Aramco CEO Amin Nasser said at an investment conference in Saudi Arabia that the fund will focus on “breakthrough technologies that are important and startups that will help us to address climate change."

Nasser billed the fund as one of the world's biggest sustainability-focused venture capital funds and said it would invest globally and launch immediately. He spoke at Saudi Arabia's Future Investment Initiative meeting, sometimes known as “Davos in the Desert,” a comparison to the World Economic Forum's annual meeting of corporate bigwigs and world leaders in the Swiss Alps.

Aramco is one of the largest corporate greenhouse gas emitters. Environmentalists have long accused oil and gas companies of using climate-friendly pledges to “greenwash” their polluting activities.

One area Aramco's fund will focus on is carbon capture and storage, which involves sucking heat-trapping carbon dioxide from factory smokestacks and storing it underground.

Climate experts, however, warn the technology is risky, unproven and expensive and could be used to delay the phaseout of fossil fuels. Others say all untested solutions should be pursued given how little time there is left to meet U.N. emissions-cutting goals.

Other investment themes the fund will target include greenhouse gas emissions, energy efficiency, nature-based climate solutions, digital sustainability, hydrogen, ammonia and synthetic fuels.

Aramco has committed to reaching net zero operational emissions by 2050, but that only accounts for a fraction of the company’s total emissions. It does not include...