Page 7 - DMEA Week 03 2023

DMEA POLICY & SECURITY DMEA

London court dismisses

effort to block LNG finance

AFRICA FRIENDS of the Earth, an international envi- company’s strong interest in climate-related
ronmental group, has failed to overturn a lower issues, saying: “TotalEnergies supports the goals
court ruling green-lighting the UK’s plan to pro- of the 2015 Paris Agreement, which calls for
vide funding for the Mozambique LNG project. reducing greenhouse gas emissions in the con-
The non-governmental organisation (NGO) text of sustainable development and the fight
has been seeking to prevent UK Export Finance against poverty.”
(UKEF), the British government’s export credit Meanwhile, Friends of the Earth took the
agency, from upholding a pledge to provide up to opposite stance, saying that the group had not
$1.15bn in funding for Mozambique LNG. It has exhausted its legal remedies and was consider-
premised its case on the argument that the pro- ing filing an appeal in the UK Supreme Court.
ject, led by TotalEnergies (France), contravenes In a statement, it quoted Rachel Kennerley, an
the Paris Agreement on climate change. international climate activist affiliated with the
But on January 13, London’s Court of Appeal group, as saying: “This extremely disappointing
ruled against Friends of the Earth. Judge Geof- judgment doesn’t alter our firm belief that the
frey Vos wrote in his decision that UKEF’s UK government should not be supporting the
determination that Mozambique LNG was Mozambique gas project or any fossil fuel project
compatible with the Paris Agreement was “ten- at home or abroad.”
able” and further noted that the agency was not TotalEnergies is serving as operator of the
required to be certain that its decisions about Mozambique LNG consortium through its sub-
funding dovetailed exactly with the govern- sidiary Total E&P Mozambique Area 1, which
ment’s climate-related commitments. holds a 26.5% stake. The remaining equity in the
Furthermore, Vos noted, the Paris Agree- consortium is split between two Japanese com-
ment was “only one of a range of factors” that panies, Mitsui and Japan Oil, Gas and Metals
UKEF took into consideration when deciding National Corp. (JOGMEC), which have a com-
whether to provide financial support to Mozam- bined stake of 20%; Mozambique’s national oil
bique LNG, which is likely to carry a price tag of company (NOC) ENH, with 15%; BPCL, with
around $20bn. 10%; ONGC Videsh (India), with 10%; Beas
Rovuma Energy Mozambique (a 60:40 joint
Responses venture between ONGC Videsh and Oil India
UKEF has welcomed the Court of Appeal’s Ltd, or OIL), with 10%; and PTTEP (Thailand),
ruling. “We remain confident that UK Export with 8.5%.
Finance follows robust and internationally The French major and its partners aim to
recognised due diligence before providing any extract gas from Area 1, which lies offshore
support for overseas projects,” an agency spokes- Mozambique within the Rovuma basin. They
person said on January 13. will process the gas at an LNG plant and onshore
For its part, TotalEnergies has responded complex on the Afungi Peninsula. This facility
positively and talked up the anticipated benefits will eventually have two production trains, each
of Mozambique LNG. A spokesperson for the with a capacity of 6.44mn tonnes per year (tpy).
French major said on January 13 that the pro- Work on the onshore facility was suspended
ject was expected to “deliver a range of social in March 2021 due to the deteriorating secu-
and economic benefits to Mozambique and is rity situation in Cabo Delgado, Mozambique’s
a key part of Mozambique’s aim to diversify its northernmost province. Conditions have
economy.” improved since that time, but TotalEnergies has
The spokesperson also emphasised the yet to resume work at the site.™

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