• Two NGOs sued the US Export-Import Bank, claiming it approved a $4.7B loan to Mozambique LNG in violation of legal procedures.
• The loan is critical to restarting the TotalEnergies-led project, stalled since 2021 due to jihadist violence.
• The legal flaw—loan approval by an interim board without Senate-confirmed directors—could void the deal and stall financing.

The US Export-Import Bank (Exim) thrust itself back into the spotlight when it approved a $4.7 billion loan for the Mozambique LNG project. This decision positions the US as a key player in Mozambique’s energy sector and marks a clear shift in American policy on African gas. However, it also triggered legal action and sharp criticism, spotlighting deep rifts over the move.

The US Export-Import Bank (Exim) approved the loan in March to revive TotalEnergies’ Mozambique LNG project, which has been on hold since jihadist attacks in 2021 in Cabo Delgado. The deal was hailed as a shift in US energy engagement in Africa. But two NGOs—Friends of the Earth and Justiça Ambiental—filed a lawsuit on July 14 in a US federal court, accusing Exim of bypassing legal procedures in the approval process.

The plaintiffs argue that Exim Bank reinstated its support without complying with its charter or the 1945 Exim law. They say the agency failed to conduct proper environmental and social assessments, neglected transparency requirements, and did not consult Congress or the public. Critically, they claim an interim board—appointed under former President Donald Trump—made the decision without the minimum three Senate-confirmed directors, making the move illegal.

A Procedural Flaw That Threatens Project Restart

This procedural flaw could invalidate the loan and stall the entire project.

TotalEnergies has linked the resumption of on-site work to the confirmation of international financing. Exim’s loan was supposed to send a strong signal to other investors still unsure about backing the project. But legal uncertainty now clouds that signal.

The NGOs also raise fresh concerns about security in Cabo Delgado. They say Exim staff still can’t access the site and that Mozambican forces protecting the area have been accused of human rights violations. French authorities are also investigating TotalEnergies over how it handled the evacuation of its personnel in 2021.

In the US, the loan approval has sparked political backlash. Some Republicans, including Trump allies, criticized the use of public funds for what they see as a risky foreign gas venture. They argue that US-based projects like Alaska LNG struggle to get similar support, and backing Mozambique LNG undercuts US gas exports in the global market.

If a court confirms the governance flaw, Exim’s approval could be overturned, casting doubt over the $4.7 billion deal and delaying a project expected to produce 12, 88 million tons of LNG per year.

Olivier de Souza