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Bahrain Oil Field Wins US Financing Despite Biden’s Climate Vow

(Bloomberg) -- The US Export-Import Bank voted to provide a $500 million loan guarantee for an oil and gas development in Bahrain, despite objections from Democrats who said it would stoke climate change and undermine US credibility on the issue.

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The financing agreement approved Thursday was five times larger than lawmakers and others expected and will support a project to drill more wells in the prolific Bahrain field. The bank said it will “increase the production of oil and the availability of gas to meet the future energy demands” of the country.

The ex-im bank, an independent government agency that finances foreign projects, approved the deal one day after Democratic lawmakers led by Senator Jeff Merkley of Oregon sent a letter to board members urging them to reject it. Merkley called the bank “a rogue agency,” saying its actions run counter to the commitment nearly 200 nations made at the COP28 climate summit last year to transition away from fossil fuels.

“This approval signals another setback for Biden’s climate commitments and cements the United States yet again as the worst of the laggard countries in violation of the promise to end international public finance for fossil fuels,” said Nina Pušić, an export finance climate strategist with the advocacy group Oil Change International.

Bapco Energies, Bahrain’s state oil and gas holding company, is the immediate beneficiary of the financing, expected to support some 2,100 jobs in Texas and other states, according to the ex-im bank. SLB, the world’s biggest oil-services provider, also stands to benefit from the loan, according to documents the bank posted on its website.

Bank president Reta Jo Lewis said in a statement that the transaction will enable Bapco Energies to improve the nation’s power grid while investing in energy efficiency and solar projects.

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