A group of 28 NGOs have written to 34 banks, insurance companies and the Chinese government, urging them to deny financing and other support for oil and gas projects in Uganda.
The letters, written by U.S.-based Climate Rights International (CRI) and 27 Africa-based NGOs, follow a report detailing numerous human rights violations and environmental harms at the Kingfisher oil project sites in Uganda. Similarly, Uganda’s Tilenga oil fields also face scrutiny over their ecological and social harms, including impacts on wildlife and displacement of local communities.
Both Kingfisher and Tilenga are co-owned by French oil and gas giant TotalEnergies, the Chinese National Offshore Oil Company Uganda Ltd. (CNOOC), and the Uganda National Oil Company (UNOC). Both projects are also part of the East African Crude Oil Pipeline initiative (EACOP), where TotalEnergies is a major partner. The initiave aims to transport oil and gas from Uganda to Tanzania for export.
“The Ugandan oil projects are associated with serious human rights abuses, environmental degradation, massive carbon emissions, and a disturbing disregard and lack of accountability for harms to local communities,” Brad Adams, CRI’s executive director, said in a statement.
Major banks and insurance companies in Europe, Japan and North America have ruled out support for the projects, he added. “Now it’s time for all banks and insurance companies, whether in Europe, China, the Gulf States, Africa, or elsewhere, to publicly rule out any continuing or further support.”
There are already hints of financial woes for TotalEnergies. Africa Intelligence reported on Oct. 8 that TotalEnergies is facing a severe funding crunch for EACOP. “Shunned by Western financial institutions, TotalEnergies is counting heavily on China’s state-owned export credit insurance bank Sinosure to back the EACOP project (to the tune of $1bn) and to convince other Chinese banks to do the same,” the report said.
In response to Mongabay‘s request for comments on Africa Intelligence’s report, François Sinecan, press officer at TotalEnergies, said: “As I told to Africa Intelligence also: we don’t comment [on] the financing of our projects.”
Chinese funding, however, may be hard to come by. Adams told Mongabay that Uganda’s president had recently gone to China, “but came back empty-handed.”
“The Ugandan government has repeatedly said that they would obtain more financing from China and European banks but so far nothing has materialized,” Adams said. “We think this is because of community opposition and the terrible human rights and environmental record of Kingfisher and the wider project, which will cause a backlash for new lenders or insurers. They should also realize that they may be left with stranded assets when global demand for oil and gas decreases.”
Sources familiar with a recent meeting between the StopEACOP campaign and the Chinese ambassador to Uganda told Mongabay they could confirm that no Chinese financial institution has committed to funding or insuring EACOP. “If they decide to, it will be after a thorough environmental and social impact assessment,” they said.
This article by Shreya Dasgupta was first published by Mongabay.com on 17 October 2024. Lead Image: Rhett A. Butler/Mongabay.
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