OSLO, Feb 23 (Reuters) - Norway's $1 trillion sovereign wealth fund, the world's largest, will generally shun investments in energy sources such as coal that are unlikely to be needed in a future low-carbon society, it said on Friday.
In 2016, the Norwegian parliament mandated the fund, which invests Norway's revenues from oil and gas production in stocks, bonds and real estate abroad, to sell out of firms that derive more than 30 percent of their activities or revenues from coal.
"This divestment from coal means that the fund does not generally invest in an energy source that will probably not survive the transition to a low-carbon society," the fund said in a letter to the Norwegian Ministry of Finance dated Feb. 21.
The letter, signed by fund CEO Yngve Slyngstad and Chief Corporate Governance Officer Carine Smith Ihenacho, was published on the fund's website on Friday.
"The fund's exposure to climate risk therefore differs from that of a general, market-weighted portfolio," it added.
The fund proposed in November that it should remove oil and gas stocks from its equity benchmark index, which would mean cutting investments in those companies over time. At the time, the news sent the value of oil and gas firm worldwide lower.
The proposal is under review at the finance ministry and will be voted on by the Norwegian parliament at a later stage. (Reporting by Gwladys Fouche; Editing by Alister Doyle and Edmund Blair)