This frontline story accompanies the Banking on Climate Chaos: Fossil Fuel Finance Report 2024, produced in collaboration with Center for Environmental Law and Rights (CELOR), BankTrack, Rainforest Action Network and Reclaim Finance.
The Pacific country of Papua New Guinea – a half island nation in Melanesia – is one of the most biodiverse places on the planet. It is home to hundreds of languages, iconic species such as the Bird of Paradise, the world’s third largest contiguous rainforest and diverse marine environments. It is a place of stunning beauty and deep, ecological knowledge. PNG’s constitution enshrines that its natural resources and environment be conserved ‘for the collective benefit of all’ and that nature be replenished for future generations. Much of the population rely on their lands or waters for food, livelihoods and culture. PNG peoples have fought hard to defend their lands, traditional law and kastom from extractivism since the colonial era and in the post-independence period.
Today, TotalEnergies – with its co-venturers ExxonMobil, Santos and JXNippon – is pressing to develop a new carbon bomb – the Papua LNG project. Papua LNG will take place in Gulf Province and nine new production wells, a gas processing facility and a 320km pipeline traveling over land and in the sea. Over its lifetime, the project is estimated to produce 220 million tonnes of carbon dioxide equivalent (MtCO2-e) in scope 3 emissions (the pollution created from the burning of fossil fuels). This single project will contribute the equivalent in greenhouse gas pollution to what it takes the entire country of Bangladesh – a country of almost 170 million people – to produce a year. The project hopes to secure financing by 2025, with first gas by 2028.
PNG itself has no need for fossil gas. It has vast capacity for renewable energy and could dramatically expand its energy access with no new fossil fuels and still see up to 78% of its on-grid energy provided by renewable sources by 2030. According to government estimates, this could be done for a cost of US$110 million – almost 100 times less than the Papua LNG project’s estimated $10 billion cost. For PNG’s mostly rural population, the uptake of renewables in off-grid energy is even more rapid. Almost all of Papua LNG’s gas will go to other countries.
Peter Bosip, Executive Director of the PNG Center for Environmental Law and Community Rights (CELCOR) notes:
“The fossil fuel industry is working against the Paris Climate Agreement to keep global temperature within 1.5 degree Celsius. In PNG, Renewable energies are readily available and are cheaper than fossil fuels. Fossil fuel companies such as TotalEnergies should promote renewable energies that can benefit Papua New Guinea instead of promoting liquified natural gas development that will destroy the lives of Papua New Guineans.”
Like other Pacific nations, PNG is on the frontlines of the climate crisis. Last decade, PNG’s Carteret Islands made international headlines for devastating climate impacts on island communities. PNG is one of the most at-risk countries for climate change and natural disasters. This also brings sizeable economic costs. The Papua LNG project itself would take place in Gulf Province, where the climate crisis is leading to more severe storms and saltwater inundation in some coastal areas have led families to be displaced multiple times. Media also reports higher than normal king tides in areas affected by a proposed Papua LNG pipeline.
The biodiversity risks are profound. The project area includes at least one IUCN Red List critically endangered species, with fewer than 160 known adult individuals. Even more could be at-risk. Staggeringly, the project area includes 48 species new-to-formal science, and 15 undescribed by formal science – including a gecko, several damselflies, frogs and begonias. This raises questions about how the project can claim to manage risks for understudied species and if it is at odds with the values of the Kunming-Montreal Global Biodiversity Framework.
Some economists have raised concerns that over-reliance on extractivism skews PNG’s economy – making it even harder to evolve sustainable, non-extractive areas of the economy. Additionally, some landowners affected by the country’s first fossil gas project – PNG LNG – are still to receive payment after more than a decade since first gas. Similar problems could appear for Papua LNG. In some cases, the project has hired the same ESG consultants – despite PNG LNG’s poor track record on human rights, conflict and environmental outcomes.
CELCOR has also raised questions about Free, Prior and Informed Consent (FPIC). They point out that the project’s website doesn’t include examples of community information materials – including what information they’ve provided communities about their FPIC rights. They also raise questions about if communities have received accurate information about climate, environmental and health impacts or the combined 10 different legal cases against TotalEnergies or ExxonMobil in Europe or the US over allegations regarding misleading climate claims or actual climate harms.
Banks considering financing Papua LNG could face significant reputational, financial and legal risks. Already, all major French banks – including TotalEnergies’ top 3 bankers have ruled out financing to the project. Similarly, most of Australia’s largest banks have policies that would exclude the project. This signals that the international banks that know the lead company, or the local context, best have ruled out financing to the project. Other banks should follow their logic and due diligence and commit not to finance Papua LNG.
“Fossil fuel companies could choose to pay reparations for the harms that PNG, and other countries, already face from the climate crisis. Instead, they are trying to make us complicit in their climate destruction.” – Peter Bosip, Execaddisonutive Director of the PNG Center for Environmental Law and Community Rights (CELCOR)
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