Barclays has announced it will no longer provide direct funding for new oil and gas projects.
The banking giant said in a statement that it will restrict lending to energy businesses that plan to expand their fossil fuel production.
Barclays is a major lender to the fossil fuel industry, but has been coming under mounting pressure to curb its support for the sector.
According to a report from environmental group Rainforest Action Network, Barclays was the biggest funder of the fossil fuel sector in Europe between 2016 and 2021.
It provided just under $16.5bn in 2022, although that was significantly lower than in previous years. In 2019 and 2020, the figure was more than $30bn.
Between 2016 and 2020, Barclays provided $2.85 billion in finance for TotalEnergies, a major partner in EACOP.
In a report in March 2023, Barclays gave a thumbs up to the EACOP saying the environmental and social impacts of the project had been grossly exaggerated.
The report raised hopes in Kampala that the project, which had come under opposition from climate groups and social activists, will finally go ahead as planned.
Yet even without the funding of Barclays, EACOP shareholders have raised $2 billion. Other funds are expected to come from China Export & Credit Insurance Corporation (Sinosure) and the China Export Import (Exim) Bank.
Diageo to Exit East African Breweries as Asahi Takes ControlHowever there is still a glimmer of hope. as the bank said funding for new oil projects will instead undergo a strict vetting process.
Barclays has pointed out that oil and gas funding represents a very small proportion of its overall activities.
