Disagreement between two judges has voided an outcome of a legal action launched by a British environmental organisation to block British Government investment in Mozambique’s natural gas extraction project.
A UK government spokesperson ,cited by the UK Export Finance this Wednesday, said: “We welcome the judgment and remain confident that UK Export Finance follows robust and internationally recognised due diligence before providing any support for overseas projects.”
“We cannot comment further on ongoing legal proceedings,” added the same source.
In the decision published on Tuesday by the High Court in London, Justice Justine Thornton ruled that the UK export credit agency UK Export Finance (UKEF) had failed to comply with its obligation to calculate the project’s impact in terms of greenhouse gas emissions.
The failure to quantify emissions and other flaws in the environmental [impact] report meant that there was no rational basis to demonstrate that funding for the project was consistent with Article 2(1)(c) of the Paris Climate Change Agreement and a path to low greenhouse gas emissions, he wrote.
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By contrast, Judge Jeremy Hugh Stuart-Smith found a legal or policy obligation to quantify emissions, and it was implicit, obvious and accepted that the development of a large LNG [liquefied natural gas] field would result in very high levels of emissions.
The UKEF was entitled to form the view that support for the project that was under consideration was in line with obligations under the Paris Agreement, he said, adding that the UKEF’s view that the project was in general alignment with Mozambique’s stated climate change policies was acceptable and not shown to be wrong.
Given that the two judges reached no consensus, the Friends of the Earth organisation, which today mobilised around a dozen activists near the court, said it is awaiting a court order determining the outcome.
The protesters shouted slogans such as “keep oil in the ground” and “fossil fuels must disappear” while holding placards reading “Stop gas funding in Mozambique”.
Last year, the British organisation called for a judicial review into the government’s funding of the Mozambique project, claiming it flouts London’s commitments to the Paris Agreement and targets to halt global warming.
“Normally in a court, there is an odd number of judges or a single judge so that a majority opinion can be reached. Here we have a split decision”, the head of legal affairs at Friends of the Earth, Will Rundle, told Lusa today.
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In case the final decision is unfavourable, he admits appealing.
The responsible for the international campaigns of the organisation, Rachel Kennerley, said that the favourable opinion of a high court judge is “very significant” and a “success”.
“One of the reasons why this case and this decision are significant is that the fallacious climate assessment that UKEF used was taken on board by many other export credit agencies that were also involved in this project. So it sets a precedent to challenge that environmental [impact] assessment,” he told Lusa.
The British government has provided up to US$1.15 billion (€1.35 billion at the current exchange rate) through export credit agency UKEF to the offshore liquefied natural gas project in the Rovuma basin in Cabo Delgado, northern Mozambique.
The environmental organisation estimates that the project will be responsible for releasing between 3.3 and 4.5 billion tonnes of carbon dioxide into the atmosphere throughout the project.
Area 1 of the project is under concession to a consortium led by French oil company Total, which had to suspend construction work due to attacks by armed groups in Cabo Delgado province.
Valued at between €20 and €25 billion, Total’s gas extraction megaproject is the largest private investment in Africa, supported by several international financial institutions and envisages the construction of industrial units and a new city between Palma and the Afungi peninsula.
Before construction was suspended, the first liquefied gas export was scheduled for 2024.
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Rachel Kennerley rejected the UK government’s arguments that it is necessary to secure oil and natural gas supplies from alternative sources to Russia given the recent invasion of Ukraine, which has resulted in a rise in energy prices.
“Opening new gas fields, new oil fields in the UK, and around the world, including this project in Mozambique, is not going to help this crisis. This crisis exists because we are more dependent on gas. (…) What we need is to switch to a more secure form of energy, like renewables, which is cheap, clean and safe,” he said.
