Banks, and now insurers, drop project plagued with risk from community, cultural, and climate issues.
RIO GRANDE, TX, August 6, 2024 — An insurance certificate obtained through a public information act request for Rio Grande LNG no longer lists Chubb as an insurer of the project. The insurance giant dropped the proposed controversial methane gas project after months of organizing from community members, including the Carrizo/Comecrudo Tribe, whose sacred sites would be desecrated by the project.
This is the latest setback for the not-yet-built project that would harm the coastal landscape of the Rio Grande Valley as one of the last pristine areas of the Texas coastline—a haven for wildlife, fishing, tourism, and recreation and home to Latine and Indigenous communities—into an industrial methane export hub. Years of campaigning was a likely factor in the insurer backing away. Five banks – SMBC, Société Générale, Credit Suisse and privately, two additional banks – committed to not financing the project after pressure from community leaders.
Community members voiced the impacts that the methane terminal’s gas storage tanks, flare stacks, pipelines, and explosion risks pose to the Port of Brownsville, including the City of Brownsville and those known as the “Laguna Madre”: Port Isabel, South Padre Island, Laguna Vista, Long Island Village, and Laguna Heights. The cumulative impacts on soils, air and water quality, community health, vegetation, wildlife, threatened and endangered species, tourism, commercial fisheries, and noise would be significant.
In May, Chubb quietly updated its oil, gas, and conservation policies. A Rainforest Action Network analysis of the policies called it a small improvement but noted the loopholes and narrow scope result in policies that continue to fall short of the global climate goal and fail to address the impact of oil and gas operations on nearby ecosystems and communities.
Insurance companies pride themselves on managing risks, yet by underwriting methane gas and other fossil fuels they harm their bottom line – for example; this summer US home insurers suffered the worst loss this century due to climate disasters. The insurance industry driving uninsurability by profiting from dirty energy is foolhardy at best. On top of that, more fossil fuels means locking in decades of polluted air and water for surrounding communities. Chubb leaving this project makes industry sense and other insurers must follow its lead.
When you do the due diligence and understand Indigenous rights, this project is a no-go. Investors and major banks have dropped Rio Grande LNG, and now insurers are following suit because the claims of the fossil fuel companies can't be trusted - here, or anywhere in Texas.
We tell companies the truth about these projects that would be an environmental disaster for our South Texas community. It feels good to be heard. I expect other insurers like AIG and Sompo to drop next because the LNG facility, the pipeline, the company - they're losers with a dangerous project.
"My insurance company is refusing to pay out to repair my home after Hurricane Beryl. But Chubb has no problem insuring Freeport LNG, which not only took on damage in the storm, but emitted pollution as a result. Insurance companies need to abandon insuring fossil fuels for their own bottom line. What's true in Brownsville is true here - methane/LNG is a losing investment and Chubb should dump all of it.
Brownsville is no different than Lake Charles when it comes to methane expansion. Methane/LNG destroys the community, the environment, and its expansion is under increasing regulatory pressure to stop building. Chubb needs to pull out of all of these projects across the gulf, not just Brownsville.
Chubb is showing some promising leadership by pulling out of Rio Grande LNG. Now Chubb must take the next step of becoming a true climate leader and stop insuring all methane. Chubb has the potential to lead the industry and raise the bar for AIG and Liberty Mutual to follow suit.
AIG has tripped over itself to insure Rio Grande LNG in the wake of Chubb’s exit. This move is the latest in a long pattern of insuring and investing in fossil fuels that shows AIG’s climate and human rights commitments aren’t worth the paper they’re written on. We have one message for AIG: we won’t stop fighting until you drop these disastrous projects.
