BlackRock's largest stake in a Texas energy company was $20 billion — 6.3% of the equity float – in Exxon Mobil Corp., the letter showed.
BlackRock said in the letter that it expects to be a long-term investor in carbon-intensive sectors because those companies will play crucial roles in the economy and in the energy transition.
"We will continue to invest in and support fossil fuels companies," said Dalia Blass, senior managing director and head of external affairs, in the letter, adding "we believe that the experience, expertise and scale of fossil fuel companies will be integral to future energy solutions."
"As such, we have not and will not boycott energy companies," Ms. Blass said.
Under a 2021 law, the state can restrict the state's public pension funds and other state entities from investing with companies that divest from fossil fuel companies.
Among the Texas public pension funds affected by the new law are the $196 billion Texas Teacher Retirement System; the $49.1 billion Texas County & District Retirement System; and the $36.1 billion Texas Employees Retirement System. The funds all are in Austin.
BlackRock has faced backlash from Texas government officials, including Lt. Gov. Dan Patrick, who has accused the firm of being hostile to the oil and gas industry.
In a Jan. 19 letter to Texas Comptroller Glenn Hegar, Mr. Patrick wrote: "As you prepare the official list of companies that boycott energy companies, I ask that you include BlackRock, and any company like them, that choose to hurt Texas oil and gas energy companies by boycotting them'' in violation of the Texas bill.
As BlackRock explicitly supports investment in fossil fuel companies, the firm remains committed to its net-zero pledge and decarbonizing goals, BlackRock's spokesman said.
"We have been consistent about the important role hydrocarbon companies play in meeting the energy demands of today, while helping transition to the cleaner energy needs of tomorrow … and we must work with them to achieve a more sustainable energy mix," he said.
"Hydrocarbon companies are part of the solution, not the problem … if we're still going to be dependent on gas (and) oil for a for a certain period of time, we need to be thoughtful about working with hydrocarbon companies," said Laurence D. "Larry" Fink, BlackRock's chairman and CEO, at the Green Horizons Summit in November, a transcript showed.
BlackRock managed $10.01 trillion as of Dec. 31.
Bloomberg contributed to this story.
