CASE STATUS: ONGOING
ISSUES: Climate Justice & Accountability Corporate Accountability
SUMMARY
This case challenges the Export-Import Bank of the United States (EXIM)’s unlawful approval of a $4.7-billion-dollar loan to subsidize French oil giant TotalEnergies’ construction of a massive, highly controversial liquefied natural gas (LNG) project in Mozambique. EarthRights represents Friends of the Earth Mozambique (Justiça Ambiental, or JA), and Friends of the Earth U.S. (FOE), environmental non-profits that work with communities impacted by the project, in suing EXIM.
EXIM approved an initial loan for the project in 2019, despite strong opposition from FOE, JA, and other organizations that raised the alarm that the project would have devastating impacts on people, the local environment, and the climate. However, that loan was never disbursed and the project context has changed dramatically.
Since 2019, armed conflict between government forces and insurgents known as Al-Shabab or ISIS-Mozambique has engulfed the province where the project is located. The insurgents have murdered thousands and displaced hundreds of thousands of people. Mozambican military forces have also been accused of committing grave human rights violations against civilians in the context of the conflict.
The area has been heavily militarized with thousands of foreign troops and local security forces guarding the project. These troops have reportedly committed war crimes, including at the project site, such that multiple countries have launched investigations and paused further consideration of supporting the project.
TotalEnergies declared force majeure in 2021 due to the conflict, and construction has been halted for more than four years. The conflict remains active, complex, and highly dangerous.
Throughout 2024, TotalEnergies unsuccessfully lobbied for EXIM to re-approve financing for the project. After President Trump took office in January 2025, he named two “acting” members of the board of directors, without the advice and consent of the Senate, and in violation of both EXIM’s charter and the Federal Vacancies Reform Act. Just weeks later, the “acting” board rushed through new financing for the LNG project in Mozambique with only two days of notice to the public. EXIM made this decision without permitting public or congressional input, and in violation of federal law.
Despite the dramatically deteriorated security and human rights context, a radically changed production timeline, a completely different global LNG market, and numerous pending investigations, EXIM charged forward. Lacking the legally required quorum of Senate-confirmed board members, the “acting” board dispensed with notice and comment requirements, failed to assess the security risks to local people, failed to undertake the statutorily required economic analysis, and failed to ensure the loan would not exceed the substantive legal limitations on EXIM lending. In so doing, the “acting” board unlawfully, arbitrarily, and recklessly, rubber stamped billions of taxpayer funds for a foreign corporation and an overseas project with significant, unacknowledged human, environmental, and economic costs.
The lawsuit is brought under the Administrative Procedures Act (APA) and alleges that EXIM’s final approval violates the substantive and procedural requirements of the Export Import Bank Act of 1945, 12 U.S.C. §§ 635-635t, EXIM’s own procedures, and the National Environmental Policy Act (NEPA). Plaintiffs seek to bar disbursement of any funds under the unlawful approval and ask the court to declare that approval null and void. Plaintiffs have asked the Court to issue a preliminary injunction preventing EXIM from disbursing funds or otherwise acting under the unlawful approval while it considers the case.
Friends of the Earth United States (FOE) is a 501(c)(3) nonprofit, membership-based organization headquartered in Washington, D.C.
FOE and JA are affiliates of Friends of the Earth International, a global network of grassroots groups working in 70 countries to promote environmental sustainability, social justice, and respect for human rights.
Congress created EXIM to promote and facilitate U.S. exports by providing loans and loan guarantees to foreign purchasers of U.S. goods and services. 12 U.S.C. § 635.
As EXIM’s overseas financing can raise sensitive foreign policy, economic, environmental, social, and human rights concerns, Congress placed strict limits on EXIM’s authority under the Export Import Bank Act of 1945 (“the Bank Act”), 12 U.S.C. §§ 635-635t. Congress required that major financing decisions could only be made by a duly constituted, Senate confirmed, board of directors. Congress directed that before finally approving large transactions, EXIM must provide notice and opportunity to comment, and the board must consider the views of the public, Congress, and other administrative agencies. EXIM is required to assess and consider the potential adverse economic impacts in the United States. Congress also directed EXIM to ensure that the environmental and social impacts of the large infrastructure projects it supports are assessed and properly managed.
The lawsuit is brought under the APA and alleges violations of the substantive and procedural limitations of the Bank Act, the Federal Vacancies Reform Act, and EXIM’s own policies and procedures.
First, the lawsuit alleges that President Trump unlawfully installed two “acting” members of the Board of Directors of EXIM, in violation of the Bank Act and the Vacancies Act. Because the “acting” board lacked the statutorily required quorum of Senate-confirmed members, it lacked the authority to approve a loan of this size.
Second, the lawsuit alleges that EXIM dispensed with several notice-and-comment requirements that would have gathered critical input from the public and Congress.
Third, EXIM failed to consider the domestic economic impact of the project at the time production “will first be sold,” as the Bank Act requires.
Fourth, EXIM failed to consider the Project’s environmental and social risks, as required by the Bank Act and the Bank’s Environmental and Social Due Diligence Procedures and Guidelines. This includes considering the risks that the conflict poses to the project, its workers, and local people.
Fifth, the loan approved by the Board exceeds Congress’s limits on over-subsidizing foreign projects.
The lawsuit also brings claims under the National Environmental Policy Act (NEPA) for failure to adequately consider climate impacts.
