EACOP continues destroying livelihoods, but banks STILL back TotalEnergies

Hannah Sharland (The Canary) 15 April 2024

Ugandan communities have once again spoken out about the devastating impact of the East Africa Crude Oil Pipeline (EACOP) project on their livelihoods. In a report, they exposed the inadequate compensation and environmental harms wrecking their living, destroying their families, and making them sick. Predictably, while local communities suffer the cost of the climate destructive project, its developers continue to rake in the returns. At the same time as community members shared their stories, EACOP developer TotalEnergies raised a pretty penny on the bond market.

EACOP is 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.

On 4 April, the Africa Institute for Energy Governance (AFIEGO) released a report exploring the impacts the project has had on communities across the region. Titled “Stories of pain & resistance”, the publication shares the experiences of local communities that the EACOP project has displaced and affected. Throughout the report, people living along the pathway of the pipeline detailed a number of recurring issues. For one, the developers and its contractors have offered inadequate, low financial compensation to landowners, below the market value. 29-year-old landowner Rachael Tugume from Hoima district explained how:

After two years, they brought me assessment forms that indicated that I was to receive Shs. 500,000 [USD 127.45] for 0.089 acres of land. I did not understand these measurements because we measure our land in misiri, or plots. My affected land was one plot, whose market value was Shs. 4 million [USD 1,019.6]. My land is near a main road, making it more valuable.

Meanwhile, the project developers have disregarded the health and needs of elderly and sick people living along the pipeline. Teddy Nakintu is an elderly resident of Lwengo district. Notably, the pipeline will run a few metres from her home. EACOP has acquired some of her land, but refused to relocate her despite concerns she raised on the project’s impact on her home and health.

This made me sad. I am an old woman. I was living in peace before this pipeline, and caused no one any harm. I wonder why I am being punished. All I ask is for the EACOP Company to relocate me. Because I have been complaining, I have also not received the livelihood restoration assistance that the company is giving to other community members. Other affected people have been receiving seeds but because my son, who is speaking on my behalf, has raised my grievances, he is always told that we are not on the list of people that are to receive livelihood restoration. On top of this, many in the report explained how EACOP had cheated them out of compensation for their crops. 40-year-old disabled farmer Ismail Bwow Jjuko detailed how his: banana and coffee plants were also affected by the project. My property was assessed while I was in Kampala and I was informed that the following crops of mine were affected by the pipeline: 36 mature coffee plants, 48 immature coffee plants and bananas. Some of my coffee plants that had started flowering were assessed as being immature! Very little money was paid for immature plants. When it came to bananas, saplings were not assessed.

Now, fisherfolk on Lake Albert have also added their grievances against EACOP and its related fossil fuel projects to this litany of injustices. Specifically, these concerned the oil and gas extraction projects that developers have designed EACOP for. As the Canary previously reported in 2023:

In early August, the company started operations in Murchison Falls National Park, in the Lake Albert region. There, EACOP joint venture companies have discovered oil fields containing approximately 1.7bn barrels of recoverable oil. These sit on the border between Uganda and the Democratic Republic of Congo. Due to the large deposits of oil, the companies are developing the EACOP project to deliver crude to Tanzania for international export.

These are the Tilenga and Kingfisher oil fields.

Already, the projects are impacting fishing communities in the region. On 10 April, fisherfolk living around Lake Albert petitioned TotalEnergies and CNOOC. In a letter, they said:

Fisherfolk including fishermen, divers and traders, majority of whom are women, say that the Kingfisher and Tilenga oil project activities have negatively impacted their livelihoods.

Notably, the letter highlighted a number of these impacts, including:
  • Polluting run-off into Lake Albert affecting fish stocks.
  • Pollution of a lagoon from poor waste management.
  • Inadequate compensation displacing members of fishing communities and jeopardising their livelihoods.
  • Inappropriate relocation to villages where fisherfolk are unable to make a living trading fish.
  • Light and noise pollution disrupting fishing and harming health.
  • Oil-driven in-migration causing gentrification that is harming local fish trading businesses, of primarily women.

  • As such, the fishing communities called on the TotalEnergies and CNOOC to address these harms.

    Yet, while TotalEnergies’ projects have been running roughshod over the livelihoods of these communities, the company continues to profit. At the start of April, a number of commercial banks helped TotalEnergies to raise US $4.25bn on the bond market.

    Bonds are the French oil and gas major’s main source of financing. These enable it to pursue its climate-wrecking strategy. In particular, it does so by helping it to develop new oil and gas projects. Of course, this includes the Tilenga and Kingfisher fields in Uganda. Notably, the fossil fuel giant has 45 active bonds totaling US $48.9bn, which accounted for 68% of the company’s financing between 2016 and 2022.

    Multiple commercial banks and large insurers have ruled out direct finance and support for the controversial project. Most recently, five leading insurance companies have confirmed that they would not support the EACOP. This took the total declarations to not insure or reinsure EACOP to 28 companies.

    Crucially then, it is largely these bonds which are enabling the company to pursue its climate and community destructive EACOP project. Significantly, Standard Chartered, BPCE/Natixis, and Deutsche Bank all aided the company with raising funds through its bonds at the beginning of April. Of course, all three companies have previously publicly confirmed they would not directly finance EACOP.

    Given this, a coalition of non-profits are calling on banks to ditch facilitating the issuing of new bonds by TotalEnergies.

    Coinciding with the Lake Albert fishing communities’ letter to EACOP developers, nearly 60 non-profits from around the world penned a letter to banks and investors of TotalEnergies.

    In it, they are calling on the banks to commit to no longer facilitating TotalEnergies’ bonds. Additionally, they are calling for this to extend to any other company developing new oil and gas projects. In tandem with this, they are also calling on investors to stop investing in new bonds issued by TotalEnergies. They are also asking them to make a public commitment not to invest in bonds issued by any company developing new fossil fuel projects.

    Sustainable investment campaigner at Reclaim Finance Lara Cuvelier said:

    Bonds are more discreet than project financing and provide TotalEnergies with a veritable El Dorado. It’s mind blowing to see that the financial players involved in Total’s latest bond are agreeing to finance Total until 2064! It is more than time that the investors and the banks behind these colossal transactions recognized their responsibility in financing Total’s climate–wrecking strategy.

    Crucially, 10 of TotalEnergies‘ 45 active bonds are due to expire by the end of 2025. Therefore, it is possible that the company will seek to renew them in order to raise capital. Current banks and investors supporting the company’s most recent bonds have included Abrdn, Allianz, Amundi, BlackRock, Bank of America, Barclays, NatWest, Deutsche Bank and Société Générale.

    Ultimately, fossil fuel companies like TotalEnergies and their financiers continue to profit off the back of people in the Global South. In other words, climate colonialism is alive and kicking. However, communities and climate groups everywhere won’t stop fighting against these profiteering fossil fuel capitalists wherever they appear.


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