U.S. funding denied for huge natural gas project

Friday, August 29, 2003

WASHINGTON -- The Export-Import Bank of the United States, after heavy lobbying from environmental groups, denied funding Thursday for a large natural gas development project in Peru backed by two Texas-based energy companies with close ties to the Bush administration.

The bank's board of directors, who oversee an independent federal government agency that helps finance the sale of U.S. exports, voted 2-1 to deny approximately $200 million in loan insurance for the project on the Lower Urubamba River basin near the Camisea River.

Environmentalists said the so-called Camisea project could destroy one of the world's most biologically diverse and wild rain forests, with indigenous people living in isolated areas.

"This decision is situation-specific," Ex-Im Chairman Philip Merrill said, "and does not reflect the bank's overall interest in financing U.S. exports for energy projects throughout the world."

Environmental groups praised the board's decision.

"Ex-Im board members displayed courage and environmental leadership in the face of considerable pressure," said Jon Sohn of Friends of the Earth.

Two of the companies involved in the project, Hunt Oil Co. of Dallas and Halliburton Co. of Houston, have close ties to the Bush administration and the Republican party.

On the Net:

Export-Import Bank: http://www.exim.gov

Friends of the Earth: http://www.foe.org

Respond to this story

Posting a comment requires free registration: