– Legal action puts US$4.7 billion approved by EXIM Bank at risk for the Mozambique LNG project
Maputo (MOZTIMES) – International environmental organisations filed a civil lawsuit on Tuesday in the United States District Court for the District of Columbia seeking to halt the disbursement of US$4.7 billion in financing for the Mozambique LNG gas exploration project in Cabo Delgado, operated by French multinational TotalEnergies.
Leading the case are Friends of the Earth U.S. and Justiça Ambiental/Friends of the Earth Mozambique, represented by the U.S.-based legal advocacy group EarthRights International. The NGOs argue that the approval of the funding by the United States Export-Import Bank (EXIM Bank) was unlawful and that the project “displaced thousands of local residents, has been the scene of alleged human rights violations, is surrounded by violent conflict, and will cause significant environmental destruction.”
The organisations accuse EXIM Bank of rushing the approval process “without conducting the required environmental and economic assessments, and without enabling the public and Congress to participate as mandated.”
“EXIM failed to comply with its own statute and federal law, creating a dangerous precedent for future decisions,” reads the NGOs’ statement.
The lawsuit also accuses U.S. President Donald Trump of illegally appointing board members to EXIM Bank without Senate confirmation, in violation of official nomination procedures.
“Just weeks later, in March, that improperly constituted ‘interim’ board approved a massive loan to support a controversial project led by oil giant TotalEnergies,” the NGOs claim. “The decision was taken despite the ongoing armed conflict and humanitarian crisis in the region, as well as TotalEnergies’ own declaration of force majeure.”
Kate DeAngelis, Deputy Director of Economic Policy at Friends of the Earth U.S., is quoted in the statement as saying, "there are legal procedures and safeguards in place to ensure the U.S. Export-Import Bank does not waste taxpayer money on risky projects in areas affected by violent insurgencies.”
MOZTIMES learned that the environmental organisations have retained experts on jihadist insurgency to argue in court that financing the gas exploration project in Cabo Delgado contributes to fuelling the conflict. They claim the project is one of the structural causes of the insurgency, exacerbating local inequalities between the affected communities and workers brought in by the project.
“Mozambique’s LNG would only benefit fossil fuel companies and a small political elite,” the NGOs argue. “Continuing to fund gas projects in Cabo Delgado would be a betrayal of Mozambique and of humanity. It would be a disregard for justice owed to those who have suffered human rights violations. It would ignore the voices of families bearing the heaviest burdens, those who have lost their land, access to the sea, and their livelihoods.”
If the U.S. court rules to suspend the disbursement of funds, it could delay the resumption of TotalEnergies’ project in Cabo Delgado, currently expected in the third quarter of 2025. EXIM Bank’s contribution represents roughly 25% of the total investment required for the US$20 billion project. (MT)
