JBIC audits AG&P terminal funding
Protect VIP filed a complaint with JBIC for its $100 million investment with Osaka Gas to AG&P’s local unit Linseed Field Power Corp.
Residents of Batangas City communities near the marine heritage area called Verde Island Passage, or VIP, successfully convinced the Japanese government to review a gas terminal project of AG&P, a company that is partly owned by the Japan Bank for International Cooperation, or JBIC.
The terminal’s construction began in 2021 after the Department of Energy approved an application to continue its development.
The Examiner for Environmental Guidelines of JBIC is set to investigate potential violations by the bank about its support to the Atlantic Gulf and Pacific Company, or AG&P, which built a liquefied natural gas import terminal in the biodiversity hotspot.
JBIC is Japan’s wholly state-owned international public finance institution and export credit agency. The complaint is the first request for investigation on LNG to be accepted by the bank.
In December 2023, fisherfolk leaders, local community members, and concerned groups led by Protect VIP’s environmental advocacy group filed a complaint with JBIC for its $100 million investment with Osaka Gas to AG&P’s local unit Linseed Field Power Corp.
According to Protect VIP, AG&P’s LNG terminal in Batangas City is the subject of several complaints from stakeholders related to permit violations on tree cutting, land conversion, and environmental compliance.
A violation of land conversion requirements led to a cease-and-desist order by the Department of Agrarian Reform against the project in August 2022.
“We welcome JBIC’s decision. This is a first step for JBIC to finally hold itself accountable for its contribution to the proliferation of dirty gas energy in our Amazon of the oceans, in helping threaten the livelihood and overall well-being of communities, and in supporting a project that violated national laws,” Fr. Edwin Gariguez, lead Convenor of Protect VIP, said. The ecology protection advocate said the latest development signals to all other developers and financial backers of LNG that communities will take a stand against their “destructive plan.”
Laws breached
The investigation requested by Protect VIP and stakeholders pertains to the bank’s failure to monitor Linseed’s compliance with local and national laws, properly classify the project’s environmental sensitivity under its regulations, and take action as demanded by their guidelines.
Rodrigo de Jesus, president of the Solidarity of Fisherfolk in Batangas, said when banks like JBIC fund destructive projects like the LNG terminal of AG&P, they are also funding the loss of livelihood of fisherfolks.
“We trust that they will be thorough in the conduct of this investigation. On our part, we will be vigilant to make sure that fisherfolk and communities in the VIP are given justice,” he added.
Gerry Arances, executive director of the think-tank Center for Energy, Ecology, and Development and co-convenor of Protect VIP, said Japan is one of the world’s biggest promoters of fossil fuel dependence through the projects they finance.
“Commencing this investigation with its public finance arm is a critical opportunity for Japan to right its wrongs to communities and countries suffering from fossil-fueled socio-economic, environmental, and climate crises,” Arances explained.
He added that even US President Joe Biden recently announced that his government would stop issuing LNG export approvals.
“Biden’s step should be taken as a sign by Japan that it is high time to rethink its insistence on forcing more LNG and fossil fuels in the Philippines and the rest of the world,” Arances said.