Green Groups Blast Biden Over 'Taxpayer-Funded Bailouts' for LNG Industry

Green groups on Friday called out the Biden administration after the U.S. export credit agency approved lending support for Trafigura, a major commodities trader, that will enable a surge in gas exports to Europe even as the climate emergency driven by the fossil fuel industry rages worldwide.

"Despite posting record-breaking profits, Trafigura just received a massive giveaway from the U.S. government that will let them work with the biggest liquefied natural gas (LNG) exporters in the world to drive up energy prices for Americans and fund stock buybacks for their investors," said Sierra Club's Talia Calnek-Sugin in a statement.

"This is an insult to the communities forced to bear the brunt of LNG buildout and the devastating impacts of climate disasters fueled by fossil fuel dependence, and to families and businesses across the country that will face higher energy prices that come from exporting overseas," she asserted. "It's time to put an end to the U.S. government's taxpayer-funded bailouts of risky commodity speculators like Trafigura."

"It's time to put an end to the U.S. government's taxpayer-funded bailouts of risky commodity speculators like Trafigura."

The Export-Import Bank of the United States (EXIM) recently notified Congress of plans to insure $400 million in revolving credit facilities for Trafigura. As the Financial Timeshighlighted last month, the commodity trader "reported record net profits of $5.5 billion in the first half of its financial year," over double the same period 12 months earlier, and "paid a record $3 billion dividend to be shared among about 1,200 shareholders," which "was up from $1.7 billion in the previous year."

Following EXIM's legally required congressional notification, the agency confirmed Thursday that its board of directors greenlighted financial institution buyer credit (FIBC) policies for Citibank and Credit Agricoles that will allow Trafigura to buy LNG from U.S. exporters to sell mostly to European buyers seeking alternate sources of gas due to Russian President Vladimir Putin's invasion of Ukraine.

"With this vote, we continue to fulfill EXIM's mission of supporting American exporters and jobs while advancing the Biden-Harris administration's climate efforts," said Reta Jo Lewis, the agency's chair and president. "The approval of these two FIBC policies also builds on the U.S. commitment to help improve European energy security due to Vladimir Putin's unjustified war in Ukraine."

Green groups continue to condemn fossil fuel giants for taking advantage of the war as well as rich governments' support for the LNG industry, which they argue is wrecking the planet, leaving the world's energy crisis unsolved, and setting the stage for stranded assets. Such critics also accuse self-styled climate champions like U.S. President Joe Biden of breaking their promises to tackle the global emergency.

"While extreme heat and environmental disasters from the continued use of fossil fuels ravage communities from coast to coast, the U.S. government is financing the companies contributing to the climate crisis," Friends of the Earth United States campaigner Kate DeAngelis said Friday.

"The potentially hundreds of millions of dollars in support to Trafigura will only advance the further buildout of dirty and dangerous liquefied natural gas export facilities that perpetuate environmental injustices in Gulf communities," she stressed. "The Biden administration must follow its commitments to reduce harmful emissions and end overseas fossil fuel finance by putting a stop to global LNG expansion."