Five financial institutions have committed their support to the climate-wrecking East Africa Crude Oil Pipeline (EACOP). EACOP Ltd. – the company acting as vehicle for the project – announced these on Wednesday 26 March.
The StopEACOP Coalition has unequivocally called them out on their decision to bankroll the destructive project. However, the group also approached the announcement with strong suspicion as well. This is because, it’s likely a shallow and desperate ploy by the company to inspire investor confidence in the project.
EACOP: the financial institutions bankrolling the project revealed
The EACOP project involves a 930-mile long pipeline that will transport oil from Uganda to a port in Tanzania. French fossil fuel firm TotalEnergies, China National Offshore Oil Corporation Ltd (CNOOC), and Uganda’s state oil company are partnering on the pipeline.
The five banks in question now bankrolling it are: the African Export-Import Bank (Afreximbank), Standard Bank of South Africa, Stanbic Bank Uganda, KCB Bank Uganda, and the Islamic Corporation for the Development of the Private Sector (ICD).
Several of the project’s lenders have made previous public announcements of their intention to finance EACOP. Reported commitments from Afreximbank, and Islamic Development Bank date back to 2022. Both institutions faced intense backlash from Ugandan and Tanzanian civil society. Similarly, local communities have opposed Standard Bank for years for its reported involvement.
Nonetheless, with this new confirmation, the banks have marked themselves as enablers of climate chaos, environmental destruction, and the continued exploitation of Uganda and Tanzania’s natural resources for the benefit of international profiteers at the expense of local communities.
The announcement does not disclose the loan amount committed by the five banks. However, it cannot conceal the project’s failure to reach full financial close after more than seven years of delay.
A planet-wrecking catastrophe in the making
The StopEACOP Coalition has highlighted that at a time when the world is experiencing the ever-escalating impacts of climate crisis, the decision to fund a massive fossil fuel infrastructure project is not just irresponsible – it is an active assault on our planet and our people.
EACOP promises only to deepen the crisis of climate collapse, exacerbating droughts, floods, and extreme weather events that disproportionately affect African communities, who have contributed least to the climate crisis but suffer its worst impacts.
Notably, if completed, it would increase global carbon emissions by 379 million tonnes CO2e over its lifetime. This would put the Paris Agreement targets in jeopardy and making it likely the world will pass critical tipping points in the climate system.
Furthermore, the so-called pledges of development made by EACOP and its backers are nothing more than corporate propaganda.
The reality is starkly different: the project has already displaced tens of thousands of people to make way for the pipeline. The project has meant the loss of their livelihoods, inadequate compensation, and worsening socio-economic conditions.
Ultimately, the project prioritises the extraction of Uganda’s oil (alongside potential exploitation of reserves in the Democratic Republic of Congo and South Sudan) not for the benefit of the people, but for refining and consumption abroad. Crucially, this is for the profit of TotalEnergies and its partners, while local communities bear the social and environmental costs.
On the side of corporate greed over people and the planet
The StopEACOP coalition therefore echoes the strong opposition voiced by Ugandan, Tanzanian, and DR Congolese civil society organisations and are calling on all other financiers to refuse to fund the reckless venture.
In a press statement, the coalition said:
Those who have already provided financing have shown which side of history they stand on: the side of destruction, exploitation, and corporate greed. They have chosen to be enemies of the people of Uganda, Tanzania, the East African region, the African continent, and indeed, all of humanity.
The EACOP is a project that has long been shunned by major financiers the world over. To date, 43 banks and 29 (re)insurers have already ruled out support for EACOP. Even major investors in TotalEnergies are trying hard to get the fossil fuel giant to drop the EACOP project.
Nordic bank Nordea is one such example. It is among the 60 largest private banks in the world with investments in Total. Recently, it shared that, in addition to banning project finance, they are not purchasing any new shares or bonds in Total because of its EACOP project. Further, they are evaluating additional measures to influence Total, with the next potential step being a full exclusion of the company from the remaining third of their portfolios.
Notably, the few entities now involved in the project’s partial funding – particularly the smaller ones – are neither capable of financing the entire project nor do they provide the legitimacy EACOP seeks.
StopEACOP coalition therefore issued a call to other lenders demanding they avoid financing the pipeline:
While we remain deeply concerned about their confirmed role as project financiers, we trust that the world’s financial institutions will still recognise this project for what it truly is- an environmental and human rights catastrophe in the making.
As the fight against EACOP continues, with impacted communities and ordinary people across the globe refusing to bow to those who seek to profit from our demise, we call on other potential lenders who have not already distanced themselves from this anti-developmental project to do so publicly- ensuring that our communities are protected and the sustainability of our planet is upheld.
Featured image via the Canary
