Government faces accusations over climate credibility as £240m loan to oil hub airport emerges

Emma Gatten
·3-min read
The government is considering backing the East Africa Crude Oil Pipeline
The government is considering backing the East Africa Crude Oil Pipeline

Boris Johnson has denied the Government lacks credibility on climate change over its backing for fossil fuel projects overseas, as it emerged it has previously supported an airport in Uganda’s burgeoning oil hub with a £240m loan. 

The prime minister was challenged over the actions of the government’s export credit agency, UKEF, after the Telegraph revealed it was separately considering backing for a pipeline project running from Uganda to Tanzania that could produce emissions equivalent to the UK’s annual international flights.  

Responding to a question from Caroline Lucas MP, Mr Johnson said criticism of the Government over its green credentials was “absurd”. 

The prime minister has been accused of risking the UK’s role as a climate change leader as it prepares to host the COP26 summit next year, and as it asks Britons to make lifestyle changes to help reduce emissions. 

“We're moving away dramatically and at speed from UK Export Finance support for fossil fuel exploration around the world,” he said. 

“But of course, hydrocarbons remain a significant industry in Scotland, and many other places, and insofar as there are legitimate contracts that are at risk of being frustrated, we can't do that.”

But sources at UKEF, which has provided £3.5bn backing for fossil fuel projects since the Paris Agreement in 2015, told the Telegraph that the agency would continue to back oil and gas endeavours around the world until there was a policy change from the Government. 

Earlier this year, the Government was reported to be on the verge of bringing in a ban on support for oil and gas projects, but backed off because of concerns over the impact on jobs. 

UKEF says no decision has been made on whether to support the £2.7bn East African Crude Oil Pipeline project, which will run through 870 miles of Uganda and Tanzania. 

Critics say that as well as its oil producing 33 million tonnes of CO2 annually, the project is expected to disrupt the habitats of elephants, lions and chimpanzees. 

In 2017, UKEF extended a loan of £240m, its biggest ever to an African government, toward the construction of an international airport to support Uganda’s burgeoning oil industry. 

The airport near the western city of Hoima is part of an oil industry hub that is intended to also include a refinery, a web of pipelines, a crude oil export hub, and a petrochemical industry. 

Juliette Renaud, a campaigner at Friends of the Earth France, said the backing for the airport increased fears that the Government might invest in the pipeline project. 

“We hope UKEF will reject supporting the EACOP, but they are more likely to support it because they are already supporting the oil industry in Uganda,” she said. 

UKEF said its decision to back the airport “was based on the merits of the individual project” and was separate to its consideration to back the oil pipeline.