28/03 update: the bank Crédit Agricole told Novethic newspaper on Tuesday that it will not finance the Rio Grande LNG project.
Copublished with Friends of the Earth France, Rainforest Action Network, Sierra Club & Carrizo Comecrudo Tribe of Texas
Paris, France and Rio Grande Valley, Texas – After years of campaigning by activists groups and NGOs on both sides of the Atlantic, Société Générale declared to have withdrawn from the highly controversial Rio Grande LNG shale gas export project planned in South Texas [1]. The French bank had been the target of a coalition of US and French organizations since 2017, when it was engaged as financial advisor by the project sponsor, NextDecade. The organizations welcome this news and call on all financial institutions to stay away from this disastrous LNG project.
This public announcement follows NextDecade’s recent one that it would reach a final investment decision for its Rio Grande LNG project by the summer of 2023 [2], after securing several sales and purchase agreements in the past months. Among the buyers are the French utility Engie, which committed in May 2022 to import fossil gas from Rio Grande LNG for 15 years – until at least 2041 [3]. TotalEnergies is also expected to announce a new buying contract with NextDecade [4].
After years of mobilization by activists and communities on both sides of the Atlantic, this announcement is a victory for civil society and a defeat for Rio Grande LNG. It comes at a time when far too many governments and companies in Europe are rushing into US LNG, locking us into dependencies that are already costing the climate and citizens far too much. This withdrawal of Société Générale is a major blow for NextDecade and should send a clear signal to those like TotalEnergies taking advantage of the crisis to bet on the dirty shale industry.
Lorette Philippot, with Friends of the Earth France
This is not the first setback for the LNG development planned in the Rio Grande Valley. In 2017, a mobilization campaign in France pushed BNP Paribas to withdraw from its advisory mandate for the neighboring project Texas LNG and to announce the end of its direct support to new LNG infrastructures connected to shale gas extraction [5]. In 2021, Société Générale had in turn taken a first step towards exiting these projects, committing to stop financing North American LNG, but kept an exception for its existing support and Rio Grande LNG [6].
We traveled to Paris in 2017 to meet with French banks officials. We protested outside their bank offices, confronted their shareholders. French bank BNP Paribas stopped their support for Texas LNG but we were booed at Société Générale’s annual general meeting. But we did not back down and Societe Generale has finally withdrawn from Rio Grande LNG. Years and years of facing these banks and demanding that they step off our sacred lands and sacred sites have led us to these great victories. Now is the time for other banks, starting with Natixis to also commit not to finance new LNG in the United States.
Juan Mancias, Chairman of the Carrizo Comecrudo Tribe of Texas
Today’s victory is seven years in the making. Our community and the Carrizo Comecrudo Tribe have been pushing banks to pull their support for the proposed Rio Grande LNG gas project that is already destroying sacred Native lands, would pollute the Rio Grande Valley, and wreck the climate. Societe Generale’s withdrawal from Rio Grande LNG is a warning to all other major banks – stop supporting fracking and LNG.
Rebekah Hinojosa, with Sierra Club
On March 8th, 37 NGOs wrote to the chair of the Net-Zero Banking Alliance [7] to call for its members’ commitment not to support the Rio Grande LNG nor any fracked gas export terminals and related infrastructure projects proposed for the Rio Grande Valley in South Texas. The Net Zero Emissions by 2050 scenario of the International Energy Agency, which aims at limiting global warming at 1.5°C, projects the end of new LNG terminals beyond those approved by the 1st of January 2023. Yet, only a minority of banks have committed not to finance these new projects [8].
By ending its role as financial advisor, Société Générale has finally taken the measure of the problem concerning the Rio Grande LNG project. We now hope that the bank will not be replaced by other banks such as Natixis, which have not yet committed not to support such dreadful projects. New LNG terminals are pulling us away from a 1.5°C target and it is time for banks to align their financing with this ultimate objective, a commitment they made by joining the Net Zero Banking Alliance.
Lucie Pinson, director of Reclaim Finance
Banks can’t be allowed to finance any project without the Free, Prior, and Informed Consent of Indigenous peoples upon whose lands these projects are being proposed. While this is a step in the right direction, the truth is that since the Paris agreement, Société Générale has provided over $87 million dollars in financing to fossil fuel companies and still has weak policies on fossil fuel expansion. It should not take this long to convince banks that sovereignty is worthy of recognition and respect. We want to see Société Générale phase out bankrolling fossil fuels all together. We expect other banks, including the top U.S. financiers of LNG projects, to take note of this news and follow suit immediately.
Ash Engle, Banks Campaigner at Rainforest Action Network
