South Korean ECAs challenged during National Assembly session about Barossa Project

(Friends of the Earch US, Washington, 24 October 2022) During the annual National Assembly audit this month, Korea Export-Import Bank (KEXIM) and Korea Trade Insurance Corporation (K-SURE) were questioned by assembly members on their decision to finance the Barossa gas project in Australia. The Barossa project, spearheaded by Australia’s Santos and Korea’s SK E&S, was recently ordered to halt drilling after the Australian Federal Court decided Traditional Owners had not been properly consulted. While both KEXIM and K-SURE have approved a total of USD 660 million (KRW 800 billion) of additional financing for the project, the financial deal has not been closed yet. During this year’s National Assembly audit session, K-SURE was reprimanded for violating international environmental regulations and was questioned on the Ministry of Environment’s greenwashing ruling around SK E&S’ advertisements about Barossa gas. K-SURE stated that it screened the project in accordance with international guidelines and Australian law. It also claimed that if Santos loses its Barossa drilling appeal heard at the Australian Federal Court, it will likely decide whether to proceed with its financing. A hearing from a National Assembly member revealed that K-SURE was aware of the lack of Indigenous consultation but relied on the words of project owners and commercial banks supporting the gas project, showing a passive review process in deciding to provide billions of wons' worth of taxpayer money. With continued criticism from assembly members, the Chairman of K-SURE stated that the agency will comprehensively review various risks associated with the project before deciding whether to extend the expiration date of its financing approval, which is January 2023.  Environmental activists have continued to demand the cancellation of public financing toward the Barossa gas project.