WWF files court proceedings against UK ECGD over Sakhalin II | WWF

WWF files court proceedings against UK ECGD over Sakhalin II

Posted on 15 August 2007    
Location of the Sakhalin II oilfield.
WWF has filed court proceedings against a British government department to expose operations that undermine the UK's 'ethical foreign policy' and are seriously damaging the environment. WWF, in partnership with environmental and social justice organisation The Corner House, has filed the case against the Export Credit Guarantee Department (ECGD) - the government department charged with facilitating British business abroad.

This follows the discovery, through a Freedom of Information (FoI) request, that ECGD had committed to underwriting $1bn of contracts for the Sakhalin Energy Investment Company (SEIC) - despite three years of assurances to the British public that this decision was still being considered.

SEIC is a Bermuda-registered company responsible for Sakhalin II, a major oil and gas development in Russia. The Sakhalin II project, which is, in fact, almost completed, has already caused serious environmental damage and threatens the extinction of the western Pacific gray whale.

In a letter from ECGD to SEIC dated 4 March 2004, which WWF received as part of the FoI request, ECGD gave a legally-binding commitment to support Sakhalin II subject to certain conditions being met.

But the very next day (5 March 2004), DTI minister Mike O'Brien told parliament that no decision had been made. "ECGD is awaiting further information on this issue and will want to be sure that the potential impact on the western gray whales is minimised. I am aware of the range of issues to which this project gives rise and I will approve support only if I am satisfied that these have been addressed," he said.

Almost $1 billion of UK taxpayers' money would be at risk from ECGD's support for the project.

James Leaton, WWF-UK's Oil and Gas Policy Adviser, said: "ECGD's support for the Sakhalin II project effectively gave the backing of the UK government to an environmental catastrophe. ECGD has paid lip-service to the environment, but shows no intention of taking concrete action to prevent damage caused by the projects it backs. Supporting this project shows no coherence across the UK government on protecting biodiversity or tackling climate change."

Nick Hildyard, a co-director of The Corner House, said: "ECGD has broken its own policies. It says that it only gives a commitment to support after it has assessed the environmental impacts of a project. But, in this case, it gave a legally-binding promise before getting assurances on the environment. It is impossible now to address many of those impacts, since the work has already been done. ECGD must not be allowed to offer UK government money willy-nilly to environmentally damaging business ventures benefiting foreign countries."

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