This project approval comes on the heels of President Biden’s pause on domestic LNG export permit approvals while the administration studies the climate impact of fossil gas exports, which affect global fossil fuel emissions. EXIM is also considering funding a gas project in Guyana and liquefied natural gas in Papua New Guinea, over objections from climate activists.

Friends of the Earth United States and partners sent an open letter to EXIM last month, asking the bank to halt a financing agreement of $400 million to Trafigura, which was approved in July 2023. This letter questions EXIM’s due process in analyzing loan recipients and its method of reconsideration when climate assessments are inadequate, and when financing recipients are charged with corruption.

EXIM has approved many fossil fuel projects since 2020, despite receiving directives from the Biden administration to move toward renewable energy financing. In 2023 the institution funded nearly $1 billion for overseas oil and gas development, violating President Biden’s 2021 Executive Order.

Kate DeAngelis, Senior Program Manager of International Finance for Friends of the Earth, said this:

Time and again the Export-Import Bank proves itself to a be a loose cannon, blatantly disregarding White House climate guidance to funnel hundreds of millions in taxpayer dollars toward fossil fuels. EXIM cannot be expected to make good decisions with public financing if it cannot justify the logic of its own decisions or be trusted by its own committees. We call on EXIM Director Reta Jo Lewis to immediately halt all fossil fuel financing.

Contact: Shaye Skiff, Friends of the Earth United States, kskiff@foe.org

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This week, Friends of the Earth United States and partners sent an open letter to EXIM, asking the bank to halt its payment of $400 million to Trafigura, a financing agreement that was approved in July 2023. This letter questions EXIM’s due process in analyzing funding recipients and its method of reconsideration when corruption is revealed. This comes on the heels of both the United States and Swiss governments launching investigations into the company’s affairs.

Despite this, EXIM last year gave Trafigura the massive financing of $400 million to purchase liquefied natural gas, a decision the groups charge was made based on flawed environmental damage assessments. EXIM is soon expected to approve $660 million for the Gas to Energy Project in Guyana, despite similar concerns from activists. In 2023 the institution funded nearly $1 billion for overseas oil and gas development, violating President Biden’s 2021 Executive Order.

Kate DeAngelis, Senior Program Manager of International Finance for Friends of the Earth, said this:

Companies like Trafigura continue to line their pockets with US taxpayer dollars, thanks to the US Export-Import Bank. EXIM should be embarrassed to be spending public funds on propping up companies who disregard the law and disrupt our planet, yet the institution shows no shame. We call on Chairwoman Reta Jo Lewis to live up to her climate pledges and drop this financing, and to invest in renewable energy projects that are better for people and the planet.

Contact: Shaye Skiff, Friends of the Earth United States, kskiff@foe.org

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These include:

• Close to $100 million for an oil refinery in Indonesia
• $400 million for Trafigura to aid in US liquefied natural gas (LNG) exports
• $240 million for a gas project in Iraq
• $71 million for an oil tank project in the Bahamas

Earlier this month, Friends of the Earth filed a legal complaint through the OECD to launch inquiries into EXIM’s climate rationale for advancing fossil fuels, which increases the climate footprint of the United States. Advocates had the following reactions to the EXIM decision: 

“It’s utterly galling that EXIM would even consider government support for a company owned by a billionaire who fails to employ enough workers to operate safely, destroys the climate, and literally exploded last year — which incidentally caused chaos in global gas markets,” said Jeffrey Jacoby, Deputy Director with Texas Campaign for the Environment.

“LNG exports harm America. Port towns in the Gulf South like Freeport, Texas are being inundated with methane gas projects that harm the ecosystem, displace residents, and deteriorate the quality of life,” said Kari Fulton, Senior Organizing Director with the Center for Oil and Gas Organizing. “Residents at the frontlines of Freeport LNG are pushing our federal government to stop the rush in LNG export authorizations. The Export-Import Bank should take heed and look at the long-term implications of investing in companies that are only here to ride a short-term market wave.” 

“EXIM’s logic in supporting this project is baffling — why would they want to double down on this disastrous project?” said Kate DeAngelis, Senior International Finance Program Manager with Friends of the Earth. “Shortly after EXIM’s first round of support to Freeport LNG, the finance group involved collapsed and the project exploded. Yet EXIM seems willing to fund any fossil fuel project no matter how financially ruinous or harmful to workers, local communities, and the planet.” 

“Two years ago, Joe Biden committed to end all public finance for fossil fuels. Instead, EXIM is doubling down and pouring millions more into an LNG facility that literally exploded last year,” said Collin Rees, United States Program Manager at Oil Change International. “EXIM’s funding for Freeport LNG comes just days after countries agreed at COP28 to transition away from fossil fuels, further emphasizing the gap between rhetoric and reality in phasing out oil, gas, and coal. Communities and the climate can’t afford EXIM’s deadly business-as-usual.”

Contacts:
Shaye Skiff, Friends of the Earth US,  kskiff@foe.org
Collin Rees, Oil Change International, collin@priceofoil.org

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The complaint, filed by Friends of the Earth United States, argues that EXIM is contravening the OECD Guidelines for Multinational Enterprises on Responsible Business Conduct by continuing to pour billions into fossil fuel projects, while taking no effective action to reduce its emissions or report on its emissions footprint. This comes as EXIM’s financing for fossil fuels soars ahead of the COP28 UN Climate Summit in Dubai, with 2023 financing alone nearing $1 billion after a range of controversial financing decisions this year. 

Kate DeAngelis, Senior International Finance Program Manager at Friends of the Earth United States, said this:

 As we rapidly approach the 1.5 degree mark, EXIM unashamedly continues to destroy our planet. The agency has repeatedly failed to take responsibility for how its support of fossil fuels impacts communities and worsens climate change. Instead, taxpayers are expected to look the other way as EXIM funds close to $1 billion in fossil fuel projects all over the world. It’s time for EXIM to stop gaslighting the public and cut financial ties with oil and gas.

Many more projects are under EXIM’s consideration, such as backing the Papua LNG project in Papua New Guinea and oil and gas development in Bahrain and Guyana. Such projects would push, meaning EXIM  to breach the $1 billion mark in fossil financing very soon. EXIM, a key Biden administration agency, is a globally significant financier of fossil fuels – from 2017 to 2021, EXIM financed $5.78 billion in fossil fuels, and only $120 million to clean energy. These include an oil refinery in Indonesia, $400 million for Trafigura to aid in U.S. liquefied natural gas exports, and $240 million for a gas project in Iraq. 

The OECD Guidelines require multinational enterprises to draw up emission reduction plans, avoid causing environmental damage and adhere to relevant national and international environmental policies. Government agencies and departments have previously been investigated under the guidelines in The Netherlands, South Korea, Denmark and others. 

Complaints at the OECD, if accepted, force a mediation process between parties and can result in institutions having to change policies.

The complaint comes as the Biden Administration is increasingly called upon to fulfill pledges to end its international financing for fossil fuels. President Biden promised during his 2020 campaign that he would end the United States’ international public finance for fossil fuels. In office, he issued Executive Order 14008 on Tackling the Climate Crisis at Home and Abroad and the Presidents’ International Climate Finance Plan. The administration also joined 38 other countries and institutions in signing an agreement at the 2011 UN COP26 climate conference in Glasgow to end international public finance for fossil fuels.

CONTACT: Shaye Skiff, Friends of the Earth United States, kskiff@foe.org

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