US Loans $4.7 Billion to Mozambique LNG Project Amid Controversy

The US has provided a $4.7 billion loan to TotalEnergies for a Mozambique LNG project, criticized as a ‘carbon bomb’. This funding from EXIM aims to unlock additional financing despite environmental and human rights concerns. The project had faced delays due to terrorism, and its significant emissions have prompted skepticism regarding its sustainability.

The United States has extended a $4.7 billion loan to the TotalEnergies liquefied natural gas (LNG) project in Mozambique, a venture labeled a “carbon bomb” due to its environmental impact. This funding, provided by the US Export-Import Bank (EXIM), is crucial for mobilizing further investment for an initiative estimated to cost $20 billion. Initially supported in 2019, the project faced severe delays following an assault by Islamist terrorists, which led TotalEnergies to withdraw.

The project, located in Cabo Delgado Province, was halted after a brutal attack by Al-Shabaab, resulting in significant loss of life and prompting TotalEnergies to claim a contractual force majeure. Although the company aimed for construction to resume last year, ongoing security issues and financial challenges have postponed plans until 2029. TotalEnergies CEO Patrick Pouyanné went after funding from the Biden administration; however, he experienced setbacks until the reappointment of the Trump board.

EXIM has financed overseas oil and gas developments during Biden’s tenure, despite the US’s commitment at COP26 to end such funding by late 2022. An effort by President Biden to support an OECD proposal banning funding for fossil fuel projects was blocked by dissent among member states. OECD export credit agencies deploy around $40 billion annually for international fossil fuel projects, with TotalEnergies’ project predicted to emit 121 million tonnes of CO2 equivalent per year.

Critics, including Kate DeAngelis from Friends of the Earth, argue that backing the Total project represents a significant misuse of taxpayer funds, describing it as a “climate and human rights disaster.” Recent investigations have linked TotalEnergies to serious human rights violations following allegations of negligence concerning employee safety during a terrorist attack. In addition, accusations surfaced of Mozambican soldiers committing atrocities, though TotalEnergies denies having any knowledge of such actions. Notably, US EXIM proceeded with its investment amid substantial cuts to international aid directed at stabilizing Cabo Delgado, a region deemed low priority by the previous administration.

In summary, the US loan of $4.7 billion to the Mozambique LNG project by TotalEnergies raises significant concerns surrounding environmental impacts, human rights violations, and the responsible use of taxpayer funds. Despite the promise of economic development, critics warn that the project embodies substantial climate risks and humanitarian concerns. The juxtaposition of such financial backing with recent cuts in US international aid highlights a troubling prioritization of fossil fuel investment over efforts to ensure regional stability.

Original Source: macaonews.org