Environment groups have written an open letter to the federal Trade Minister Don Farrell, calling on him to stop public spending on fossil fuels, after it was reported by Reuters last week that the Australian Government was considering giving a loan to the PNG Government to acquire a billion dollar stake in a Santos LNG project.
“This Government has repeatedly said that it supports the Paris Agreement, and that fossil fuel projects must stack up environmentally and financially - so it is alarming if the government is considering putting public money into this gas project,” said Dr. Luke Fletcher, the Executive Director of Jubilee Australia Research Centre.
“So far, Australia has resisted global calls to sign on to the Glasgow Statement on International Public Support for Clean Energy - which explicitly bans the use of public money for fossil fuels. If Australia signed this statement, projects like this LNG project would be unable to access public finance through our public export credit agency, Export Finance Australia."
“Spending public money on fossil fuel projects should not be allowed under the Climate Change (consequential amendments) Act 2022, which states that Export Finance Australia, in performing its functions, must have regard for Australia’s commitments under the Paris Agreement, which includes limiting global warming to no more than 1.5 degrees above pre-industrial levels."
“PNG investment in this project will boost Santos’ share price and deliver returns into the hands of its shareholders - not the people of PNG."
“The purchase, whether financed by a loan from Australia or not, is going to be taking PNG government revenues away from desperately needed public services and putting them into a project that has no guaranteed rates of return or timescale."
“Australia should be discouraging not facilitating this type of speculative gamble. The last attempt by PNG to play this game by buying shares in Oil Search ended in spectacular losses."
“There is a complete lack of public transparency around Kumul Petroleum revenues and expenditure and how it will finance the borrowing or manage any revenues that are ultimately generated."