The US Export-Import Bank is providing a $4.7 billion loan to TotalEnergies for a LNG project in Mozambique historically hindered by terrorism. Despite prior backing, funding was paused due to violence and ongoing security concerns have pushed the construction timeline to 2029. Critics denounce the project for its environmental impact and human rights allegations, raising questions about public spending priorities.
The US Export-Import Bank (EXIM) is providing a $4.7 billion loan to support the TotalEnergies liquified natural gas (LNG) project in Mozambique, which has faced substantial delays due to regional insurgent attacks. This support is essential for facilitating total project financing, estimated at around $20 billion. Though EXIM first backed the project in 2019, it pulled out after widespread violence from Islamist groups halted construction, leading to a contractual force majeure status requiring re-approval for financing.
TotalEnergies had intended to resume construction last year, encouraged by progress in reducing terrorist threats; however, concerns over security and financing have now postponed activities until 2029. Patrick Pouyanné, TotalEnergies CEO, unsuccessfully sought funding from the Biden administration but noted the current effectiveness of the Trump-appointed EXIM board. Despite government commitments at COP26 to end public finance for fossil fuel projects, the agency continues to approve significant funding for oil and gas developments abroad.
The proposed total output of the TotalEnergies project is expected to produce up to 121 million tons of CO2 equivalent annually over its approximately 40-year lifespan. Critics, including Friends of the Earth, argue that backing this project constitutes a severe misuse of public funds and poses dire environmental risks. Furthermore, the project has been met with scrutiny related to potential human rights violations involving local Mozambican forces under contract with Total. Investigations are ongoing due to allegations of abduction and violence against civilians by these forces, which TotalEnergies has denied knowledge of.
The connection of this project to alleged human rights violations does not seem to have deterred EXIM from proceeding with the investment. This decision occurs amid a backdrop of significant reductions in US international aid, particularly regarding efforts to stabilize the Cabo Delgado region—a shift delineated by the previous administration’s foreign policy priorities.
The US Export-Import Bank’s decision to fund the controversial TotalEnergies LNG project in Mozambique reflects ongoing tensions between economic ambitions and environmental and human rights concerns. Despite promises at international summits to curb fossil fuel financing, substantial investments continue flowing into high-impact projects. Critics argue this not only exacerbates climate change but also ties public funding to serious humanitarian implications. The project’s future remains uncertain amidst ongoing security issues and the associated risks to both local communities and ecosystems.
Original Source: macaonews.org
