The United States will provide a $4.7 billion loan to TotalEnergies for a controversial LNG project in Mozambique, despite its designation as a “carbon bomb” and ongoing human rights abuse allegations. This financing is crucial for the $20 billion project, reversing a trend towards limiting fossil fuel funding. Further scrutiny surrounding the project may impact international support amid geopolitical changes.
The United States has approved a $4.7 billion loan for a liquefied natural gas (LNG) project run by French energy giant TotalEnergies in Mozambique, despite the project’s controversial label as a “carbon bomb” and allegations of human rights abuses. The financing approval by the U.S. Export-Import Bank (EXIM) is seen as crucial for revitalizing one of Africa’s largest energy undertakings, expected to cost a total of $20 billion.
This deal represents a reversal from previous commitments made by wealthy nations to limit public funding for oil and gas developments abroad. Although EXIM initially supported the Mozambique project in 2019, fresh approval became necessary after TotalEnergies declared a “force majeure” following violent attacks by the Al-Shabaab militant group in the area, resulting in numerous civilian casualties.
Investigation claims have surfaced against Total for potential involuntary manslaughter due to safety failures during the attacks, which the company has denied. Furthermore, Politico reports that Mozambican soldiers associated with the project have been implicated in grave human rights violations, although Total’s Mozambican subsidiary disclaims knowledge of such events.
TotalEnergies had aimed to resume construction in 2024, but security issues have pushed projected operations to 2029. The company’s CEO, Patrick Pouyanné, had been actively lobbying for U.S. support, asserting that U.S. contractors significantly contributed to the workforce, thereby influencing governmental backing for the project.
Opponents of the Mozambique LNG initiative characterize it as a significant environmental threat, estimating it could generate 121 million tons of CO2 annually over its four-decade lifespan. Critics, including Collin Rees from Oil Change International, have voiced concerns over human rights violations linked to the funding, while Kate DeAngelis from Friends of the Earth US has condemned the decision as an egregious misallocation of taxpayer resources.
The project has also garnered prior support from UK and Dutch export credit agencies, which are currently evaluating their financial involvement. Both nations are weighing the legal implications of withdrawing support as the situation evolves, especially given calls for a reassessment of commitment to such fossil fuel endeavors.
Although the Biden administration expressed intentions to halt public financing for fossil fuel projects, the push was ultimately stymied by opposition from various international actors. Recent geopolitical shifts present challenges to ongoing negotiations surrounding future fossil fuel funding, marking a significant point of contention for participants in the climate dialogues.
The approval of a substantial loan for the Mozambique gas project highlights conflicting interests in global energy policies and environmental commitments. As the U.S. re-engages with fossil fuel financing, concerns surrounding human rights abuses and climate impacts loom large, raising questions about the ethics and sustainability of such investments. Continuation of international scrutiny and advocacy may influence future decisions surrounding similar projects as financial institutions assess their roles in a rapidly changing geopolitical landscape.
Original Source: www.climatechangenews.com
