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17/12/2024  

To:  

Banks: Alfa Bank (Russia), Bank of America (United States), Barclays (United Kingdom), BayernLB  (Germany), BBVA (Spain), China Construction Bank/CCB International Finance (China),  Citibank/Citigroup (United States), Deutsche Bank (Germany), DNB (Norway), DZ Bank (Germany),  Goldman Sachs (United States), Intesa Sanpaolo (Italy), JPMorgan Chase (United States), Kina  Bank (Papua New Guinea), Mitsubishi UFJ Financial Group (Japan), Mizuho (Japan), Morgan  Stanley (United States), Royal Bank of Canada (Canada), Santander (Spain), Standard Chartered  (United Kingdom), Sumitomo Mitsui Banking Corporation (Japan), UBS (Switzerland).  Public financial institutions: Asian Development Bank (ADB), China Development Bank, Export  Finance Australia, Export-Import Bank of China, Export-Import Bank of Korea (KEXIM), Export Import Bank of the United States, Italian Export Credit Agency (SACE), Japan Bank for International  Cooperation (JBIC), Korea Trade Insurance Corporation (K-SURE).  

Re: Serious social, human rights, environmental, reputational and financial risks related to Papua Liquefied Natural Gas (Papua LNG) project.  

We are a group of civil society organisations from Papua New Guinea and across the world. We want to alert you to the serious risks to communities, the environment and the climate associated with the Papua LNG project, a joint venture between Total Energies, ExxonMobil, Santos and ENEOS (JX Nippon). Any bank considering financing this project must consider these concerns, which have been highlighted for the last two years.

According to the financial database IJGlobal, Japanese bank MUFG has been approaching other banks to progress the financing of Papua LNG. We urge your bank to immediately rule out financing this project and publicly announce your decision to avoid reputational and financial risks.

MUFG is not the first financial advisor for the Papua LNG project. The project’s previous financial advisor, Credit Agricole, ruled out financing the project in 2024, possibly due to the risks outlined in this letter. IJGlobal also reports that Societe Generale may have been an earlier financial advisor. At least 11 banks have already ruled out the project, including all Australian and French banks that financed PNG LNG, the first LNG project in Papua New Guinea. 

Six Papua New Guinean organisations have already been highlighting the climate, biodiversity and human rights risks of Papua LNG. International organisations that are experts in the financial sector and/or human rights standards, procedures, expectations and due diligence processes have also raised serious concerns. These concerns raised by organisations, individuals and advocates have been cited in media outlets such as PNG Business Advantage and the Post Courier, Le Monde, Reuters and the Australian Financial Review. PNG organisations have raised concerns about whether communities have received accurate, in-depth and credible information about the project’s environmental and climate impacts, or their rights to Free, Prior and Informed Consent under the United Nations Guiding Principles on Business and Human Rights (UNGPs), Equator Principles or International Finance Corporation (IFC) Performance Standards.

The Institute for Energy Economics and Financial Analysis (IEEFA) has reported on financial risks facing the Papua LNG project, including those related to market shifts and climate change. IEEFA also highlights the project’s “history of uncertainty, political tensions and legal woes”.

Papua LNG’s total scope 3 emissions have been estimated at 220 million tonnes of carbon dioxide equivalent (MTCO2e) over the project’s lifespan. This would mean emissions from this single project would be equivalent to an entire year’s emissions from Bangladesh - a country of 169 million people.

The project is in the Gulf Province, an area already hit hard by climate change. In Orokolo Bay, some families have had to move multiple times to escape increasingly violent storms. The project area also includes 48 new-to-formal science species and one of the world’s most endangered species. This renders it impossible to fully understand, let alone mitigate, biodiversity and extinction risks.

In July 2024, Fair Finance Japan issued a report titled ‘Papua LNG in violation of ESG standards’. The study showed non-compliance with the Equator Principles, the IFC Performance Standards, the OECD Guidelines for Multinational Enterprises on Responsible Business Conduct and other standards.

Given the substantial environmental, social, reputational, financial and human rights risks involved in the Papua LNG project, we, as civil society organisations, call on your bank not to provide project finance to the Papua LNG project or corporate finance to the companies involved.

Given extensive early warnings that the project does not meet key international law or industry standards, future financiers may face potential legal actions or non-judicial complaints. This may include claims for damages that exceed any gross profits financiers may make from the deal.

We thank you for considering this important issue. We would appreciate a confirmation from your bank before 10/01/2025. We also welcome a meeting with your team to discuss our concerns in further detail.

Sincerely, 

Centre for Environmental Law and Community Rights Inc. (CELCOR), Papua New Guinea  

Japan Center for a Sustainable Environment and Society (JACSES)  

Friends of the Earth Japan  

Kiko Network  

Solutions for Our Climate  

Asian Peoples Movement on Debt and Development  

Jubilee Australia Research Centre  

ActionAid Australia  

Market Forces  

Reclaim Finance  

Alofa Tuvalu  

Liveable Arlington  

Fridays for Future Uganda  

Rainforest Action Network  

Oil Change International  

Friends of the Earth US  

The Australia Institute  

BankTrack  

Urgewald  

Nordic Center for Sustainable Finance  

Stop Total  

Tuvalu Climate Action Network  

ANV COP 21  

Mekong Watch  

Indus Consortium Pakistan  

Missão Tabita  

Les Amis de la Terre France  

Innovation pour le Développement et la Protection de l'Environnement  Bloom  

Justice Institute Guyana  

ReCommon