Friends of the Earth sues Britain over Mozambique LNG project

by Reuters
Tuesday, 7 December 2021 13:52 GMT

FILE PHOTO: Members of Young Friends of the Earth Europe demonstrate during the World Climate Change Conference 2015 (COP21) at Le Bourget, near Paris, France, December 7, 2015. REUTERS/Stephane Mahe

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Green group, Friends of the Earth rebuke British government after claiming that an 'eye-watering' amount of money was being spent on a new gas field in Mozambique, others see the project as critical to transforming the development of the African nation

By Marwa Rashad

LONDON, Dec 7 (Reuters) - A legal challenge by Friends of the Earth against the British government will be heard on Tuesday in the High Court seeking to block a $1.15 billion financing for a Liquefied Natural Gas (LNG) project in Mozambique, the environmental activist group said on Tuesday.

Britain's export credit agency UK Export Finance (UKEF) has committed to provide up to $1.15 billion of direct loans and guarantees to banks to support the design, build and operation of the $20 billion LNG project led by French energy company TotalEnergies.

Friends of the Earth said in a statement the project was incorrectly judged to be compatible with the Paris climate agreement, without proper assessment of the development's climate impacts.

It also said that project contradicts the UK's obligation to help other countries meet their own climate targets and that the government should instead invest in renewable energy and other sustainable projects.

"The UK has poured an eye-watering amount of taxpayer money into developing a huge new gas field in Mozambique right in the middle of a climate emergency," said Will Rundle, head of legal at Friends of the Earth.

A UK government spokesperson said: "We remain confident that UK Export Finance follows robust and internationally recognised due diligence before providing any support for overseas projects."

"We do not comment on ongoing legal proceedings."

TotalEnergies did not immediately respond to a Reuters request for comment.

The gas project is seen by some as critical to transforming the economy and development of Mozambique, one of the world's least developed nations, but environmental campaigners say LNG projects, while cleaner than other fossil fuels, still lock in harmful emissions for decades.

In April, TotalEnergies declared force majeure on the Mozambique LNG project following insurgent attacks.

The only drawdown on the UKEF financing has been for the purpose of payment of the UKEF premium, therefore, its net exposure is currently zero.

In September this year, UKEF published a new Climate Change Strategy, setting out its objectives to decarbonise its portfolio.

Prime Minister Boris Johnson said in April that Britain would cut carbon emissions by 78% by 2035, almost 15 years earlier than planned, in one of the most ambitious environmental targets set out by a developed nation.

(Reporting by Marwa Rashad; Editing by Jane Merriman)