The Biden administration is facing backlash over another gas project, this time abroad

Even as the Biden administration, under pressure from environmentalists, pauses approval of a major natural gas export terminal in the United States, it faces another major gas decision abroad.

A $13 billion natural gas export project in Papua New Guinea led by TotalEnergies and Exxon Mobil is underway a shortlist of projects that will receive funding from the U.S. Export-Import Bank, or Ex-Im, which supports U.S. companies around the world.

The Papua LNG gas project would be part of a portfolio of oil and gas projects that the bank is financing, including an oil refinery in Indonesia and an oil tank project in the Bahamas. The bank is also considering financing an offshore pipeline and natural gas plants in Guyana.

Some climate activists see a stark contrast between government climate actions in the United States and those around the world.

“He's done so much at home,” said Kate DeAngelis, who works in international finance Friends of the Eartha network of environmental organizations that has called on the bank not to finance the project, citing President Biden.

But he “cannot claim to be a climate champion if the US supports this fossil fuel infrastructure around the world,” she said.

Between 2017 and 2021, Ex-Im Bank, whose board of directors consists of political appointees, provided nearly $6 billion in financing for fossil fuel projects and $120 million for clean energy projects. according to a count by the Perspectives Climate Group and the non-profit organization Oxfam.

A senior ex-IM official told The Times that while the bank is “trying to align with the government's climate agenda,” it must still meet legal requirements, including a “ban on discrimination based solely on industry, sector or company.” The bank's ultimate mission, the official added, was “supporting American jobs.”

The Papua gas project was particularly controversial. It promises to bring wealth to one of the poorest countries in the world, and is strongly supported by the local government. The operators are trying to supply gas to Asian countries to move away from coal, the most polluting fossil fuel and a major driver of climate change.

The gas project “will contribute to the security of LNG supply, especially for customers in Asia, where LNG can replace coal for power generation and contribute to a substantial reduction of CO2 emissions in the region,” said Julien Pouget, deputy president at TotalEnergies, said last year. LNG stands for liquefied natural gas.

Whether gas displaces coal, rather than simply adding new capacity or displacing renewable energy sources such as wind and solar, varies widely by country. Environmental groups point to research that increasingly questions the climate benefits of switching to gas. And liquefying the gas for transport in seagoing tankers is energy intensive.

For Papua New Guinea, a largely rural nation of about 10 million people, the increase in emissions would be enormous. The project itself, the country's second liquefied natural gas project, will add more than 7 percent to energy and industry emissions. according to an analysis by the Institute for Energy Economics and Financial Analysis, a think tank critical of the company.

TotalEnergies said in a statement that it was “fully committed to keeping the project footprint to the bare minimum.” For example, the project plans to power natural gas processing with a gas and steam turbine, as well as solar energy, the company said.

Local environmental groups have warned that the project, which will be built in a remote area of ​​the country with little previous mining or oil and gas development, will harm biodiversity.

A previous gas project, led by Exxon and backed by Ex-Im, became embroiled in accusations of environmental destruction and human rights abuses. Papua New Guinea is already one of the most vulnerable countries in the world to natural hazards, including coastal erosion, landslides, floods and droughts.

“We have very serious concerns about what this project will mean for local communities, the climate and nature,” said Peter Bosip, executive director of the Center for Environmental Law and Community Rights, an advocacy group based in the nation's capital.

The project has struggled to find financial backing after French and Australian banks pulled out of the project. It has also not announced any long-term sales and purchase agreements, due to uncertainty about future gas demand.

An ex-Im spokeswoman declined to provide a timeline for a funding decision. Papua New Guinea's Ministry of Petroleum & Energy and White House officials did not respond to a request for comment.

Ex-Im's financing decision is particularly important, said Kevin Morrison, an analyst at the Institute for Energy Economics and Financial Analysis.

“They're the ones who are really going to lead by example,” he said.