Standard Bank’s EACOP pipeline funding plan still on the table despite protests

Climate activists demonstrate in South Africa during the general meeting of the Standbard Bank. PHOTO @Earthlife_JHB

Cape Town, South Africa | MELISSA BRITZ – ALL AFRICA.COM | Climate activists have demanded answers from Standard Bank for its involvement and continued support for oil and gas projects on the African continent, even as the worst effects of the climate crisis are being felt.

Activist shareholders and NGOs attended the company’s annual general meeting to ask executives about the East African Crude Oil Pipeline (EACOP), its involvement in gas extraction in Mozambique and its support for future oil projects and gas companies in the region. This comes amid growing pressure on financiers of fossil fuel projects such as banks, insurers and other financial actors who are critical to future development projects.

The heated crude oil pipeline is expected to connect Hoima in Uganda to the port of Tanga in Tanzania, covering an area of ​​1,443 km. It will pass near Africa’s largest freshwater reserve, Lake Victoria, which poses a huge threat to local livelihoods and the region’s biodiversity. According to 350.org, more than 100,000 people are evicted from their land and risk expropriation.

While oil producers often talk about jobs and income for host countries, this rarely translates into benefits for citizens.

The Bureau of Investigative Journalism reported that the deal between the Ugandan government, TotalEnergies and the China National Offshore Oil Corporation would see most of the profits go to the oil majors. The deal “much of which remains secret”… “would remove certain national laws and…” grants companies a 10-year income tax exemption and circumvents Ugandan laws that would ensure that jobs and contracts go to local people and businesses.”

But the cost of extracting fossil fuels extends far beyond mining and transportation to the heavy and ongoing cost often borne by poorer communities of water, air and polluted land that can no longer be used for sustainable livelihoods.

Nigeria has long faced the challenge of being resource-rich, with its abundant oil and gas reserves, but has also struggled with the suffering caused by pollution caused by oil leaks and spills, as well as the gas flaring. Communities have struggled for decades to seek justice from oil companies for their polluted lands and loss of income and culture.

Nigerian environmental rights lawyer Chima Williams, who for 20 years has held transnational corporations accountable for oil pollution in these communities, was recently awarded the 2022 Goldman Environmental Prize for his work.

Gas developments in Mozambique were also discussed at the Standard Bank AGM. Ilham Rawoot of Justiça Ambiental (JA!)/Friends of the Earth Mozambique states that “although many other financiers are completely reassessing their involvement in these LNG projects, Standard Bank continues to finance them. Despite claims that gas production will improve Mozambican government revenues, support broader economic development and meet energy needs, Mozambicans are poorer than they were a decade ago and the country will find itself with stranded assets and no resources to support an alternative development path.”

Standard Bank says it has yet to decide whether or not to fund the pipeline. The company also says it supports the Paris Climate Agreement and a just transition, and says developed countries should cut their emissions the most because they are the “largest historical emitters and bear the greatest responsibility”. The bank says fossil fuels are needed to “support access to reliable energy that supports economic growth and poverty reduction.”

Activists say “this position is not in line with climate science, nor with the reality of fossil fuel extraction in Africa. The financial benefits of this extraction are massively exported to developed countries, while Africans bear the brunt of the devastating social and environmental impacts”.

More than 20 banks, including most of TotalEnergies’ largest bankers, have said they will not participate in the project loan.

But how to switch from fossil fuels?

African countries have profound challenges in access to energy for their citizens. According to a report by the Economic Commission for Africa (UNECA), around 600 million people lack access to electricity and nearly 900 million people lack access to clean cooking fuel, while electricity access rates in 24 countries are below 50%.

Although renewable energy is not without its own challenges in terms of affordability and upfront costs needed for the technology, it is by far the cheapest and safest option for long term energy sustainability without compromising completely the conditions on earth necessary for human survival.

A young Sierra Leonean entrepreneur has set up an energy company that provides free electricity to rural communities that previously lacked access to safe, clean energy. Jeremiah Thoronka and Optim Energy have harnessed piezoelectricity to create a sustainable source of electricity. This form of electricity uses kinetic or motion energy when pressure is applied to certain materials. So, for example, when mechanical pressure is applied to a crystal, which is a piezoelectric material, it generates a current.

Thoronka’s design uses heat, movement and pressure. It absorbs vibrations from pedestrians and traffic to generate electrical current and create clean, affordable energy. This invention won Thoronka the 2021 Chegg Global Student Prize from the Varkey Foundation in November.

Biodiversity also presents a huge opportunity for indigenous and rural communities to be the innovators and creators of new and sustainable products made from plant and animal sources.

A report by the Montpellier Panel states that “bio-based innovations can offer technological solutions to many of the economic, social and environmental challenges facing Africa. The use of renewable biological resources, primarily from the agricultural sector, provides a platform from which to accelerate a global transition towards greater sustainability. A vibrant bioeconomy can increase agricultural productivity and support the expansion of agro-industries, both of which are vital for sustainable economic growth, job creation and improved economic competitiveness”.

“… Africa’s agricultural processing waste is being used in new ways. These by-products – usually leftover marrow, husks, stems, leaves, etc. staple crops such as sugar cane, coffee and cotton, can be transformed into productive products, including as sources of bioenergy to replace fossil fuels and even for packaging. This reduces overall carbon emissions as food waste is a major emitter of greenhouse gases,” write Dr Ousmane Badiane and Professor Joachim von Braun in an article linked to the report.

While these types of energy interventions are typically hyperlocal and small-scale, they also provide an opportunity for community-led and community-owned energy solutions that bring skills and jobs to areas often overlooked for development, as is see in the case of Optim Energy.

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SOURCE: ALLAFRICA.COM

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