Climate Activists Condemn Marsh McLennan's Decision to Insure African Pipeline

Strategic Insights -

Marsh McLennan's decision to provide insurance for the East African Crude Oil Pipeline (EACOP) has been met with criticism from climate activists, who argue that the project is morally and financially dubious. The pipeline, set to be the world's longest heated crude oil pipeline, would displace 100,000 people and pose catastrophic risks to Africa's most vulnerable communities. The move has been seen as a risky step in a volatile oil market, despite major U.S. banks JP Morgan, CitiGroup, and Wells Fargo ruling out financing for the project.

Key Takeaways:

  • The East African Crude Oil Pipeline (EACOP) would displace 100,000 people, exacerbating the risk of oil spills and environmental degradation in Africa's most vulnerable communities.
  • The pipeline's construction would pose catastrophic risks to over 40 million people who depend on Lake Victoria for water and food production.
  • Marsh McLennan's decision to provide insurance for EACOP is a significant gamble, given the current volatility in the oil market and the project's uncertain financial prospects.
  • A total of 20 banks have now ruled out supporting EACOP directly, including five major U.S. banks: JP Morgan, CitiGroup, Wells Fargo, and two others that are not specified.
  • Despite this, many banks that have declined to support EACOP directly are still providing general-purpose loans to Total, the French oil giant behind the project.
  • Climate activists argue that this is not enough and that banks must say "no" to all further finance for Total unless and until it shelves plans for EACOP and other new fossil fuel projects.

Statistics:

  • The East African Crude Oil Pipeline would be the world's longest heated crude oil pipeline, stretching across Uganda, Tanzania, and parts of Africa's largest lake.
  • Over 40 million people depend on Lake Victoria for water and food production, making the pipeline's construction a catastrophic risk for the region.
  • Marsh McLennan estimates that Total is currently $3 billion short of money for building EACOP.
  • A total of 20 banks have ruled out supporting EACOP directly, including five major U.S. banks.

Sources:

  • 350.org
  • BankTrack
  • Financial Times (FT)
  • International Energy Agency (IEA)
  • Reuters

Note: The sources are listed in exactly the same format as they appear in the original text, without any embellishments or added details.