Norway's trillion-dollar sovereign wealth fund, the world's biggest, will sell its stakes in oil and gas explorers and producers, according to a government plan.
But it will still invest in energy firms that have refineries and other downstream activities, the plan added.
The proposal indicates the fund's stakes in integrated companies, such as Royal Dutch Shell, Exxon Mobil and other majors involved in everything from exploration to selling fuel at the roadside, will not be sold.
The state, which has built up its wealth on the back of North Sea oil and gas reserves, also has no plans to sell its direct stake in Norway's Equinor.
"The government is proposing to exclude companies classified as exploration and production companies within the energy sector from the (fund) to reduce the aggregate oil price risk in the Norwegian economy," the Finance Ministry said in a statement.
Energy stocks represented 5.9% of the fund's equity investments at the end of 2018, worth about $37 billion, fund data showed.
But much of that amount is invested in integrated firms rather than smaller, dedicated explorers and producers.
Firms to be excluded from the fund would include Cairn Energy, in which the fund had a 1.92% stake worth $22m at the end of 2018, Tullow Oil, in which it held 2.1% worth $67m and Premier Oil, in which it held 1.8% worth $12m.
Norway's parliament, which still needs to approve the proposal, is expected to the back the plan as the ruling centre-left coalition has a majority in the assembly.
"Exploration and production companies will be phased out from the fund gradually over time," the government proposal said, without giving a timeline.
Stocks in energy companies, already dropping due to declining crude prices, extended their losses on the news.
The proposal, initiated by the central bank which manages the fund, aims to make Norway's wealth less vulnerable to any permanent drop in oil prices, now that the fund has increased its exposure to equities to 70% of its value from 60%.
The fund invests Norway's revenues from oil and gas production for future generations in stocks, bonds and real estate abroad.
Its investments in integrated firms at the end of 2018 included stakes of 2.45% in Shell, 2.31% in BP, 2.02% in Total, 0.99% in Chevron and 0.94% in ExxonMobil.
Oil and gas stocks would be replaced by investments in other companies, the deputy of the central bank told Reuters in 2017, when the idea was first suggested.