Published in partnership with The American Prospect.
At the end of July, a group of residents of Brownsville, Texas gathered to discuss the risk of explosions from a new methane export facility -– Rio Grande LNG -– that is being built right next to a SpaceX rocket facility with a history of explosions. Their fear? That their communities risk being blown up due to ongoing accidents in both sectors. Indeed, just the month before, an enormous explosion rocked the SpaceX facility in Brownsville.
“They’re attacking us. They’re killing us,” a resident told Telemundo, referring to the extraordinary fossil fuel infrastructure expansion in the border city.
Rio Grande LNG is one of the most expansive methane buildouts in the country, with the project set to cost $18 billion and handle a capacity of 17.6 million tons per year of liquefied natural gas, which would make it the second largest methane export facility in the US. Its largest ownership stake is held by NextDecade, a publicly traded fossil fuel firm, but it is also backed by Global Infrastructure Partners, a private equity subsidiary of BlackRock, and TotalEnergies, a major French oil and gas firm. Construction has continued despite the project being in ongoing legal limbo, with the DC Circuit Court of Appeals blocking its regulatory approvals last year.
Despite the challenges of explosions, legal uncertainty, and the ongoing climate crisis, American International Group (AIG) is insuring Rio Grande LNG. This insurance arrangement comes as a Center for Media and Democracy (CMD) investigation shows that John G. Rice, AIG’s lead independent director, holds the exact same position at Baker Hughes, a global fossil fuel technology company that has received major contracts from both Rio Grande LNG and Calcasieu Pass LNG, which is also insured by AIG.
AIG is one of the top 10 insurers of fossil fuel companies in the country, and a report by Insure Our Future, a climate advocacy group, found that it collects over $500 million annually in premiums from insuring the fossil fuel industry and held $27.4 billion in fossil fuel investments as of 2022. In addition to the Rio Grande project and Calcasieu Pass LNG Phase 1 (owned by Venture Global), AIG is also insuring Cameron LNG (majority owned by Sempra and backed by KKR, Mitsubishi, and TotalEnergies) on the Gulf Coast of Louisiana, along with historically insuring the Gulf LNG and Freeport LNG projects.
The relationship between AIG and Baker Hughes has not been publicly disclosed prior to this. In its filings with the Securities and Exchange Commission (SEC), AIG does not disclose that the projects it is insuring give major contracts to Baker Hughes despite the fact that the relationships could be material and as a result, compromise federal standards on director independence. AIG has only disclosed that Rice is a director at Baker Hughes, not that he is its lead independent director, which is the second most powerful position in a company when the CEO is also the chairman of the firm, as is the case with both Baker Hughes and AIG.
Yaron Nili, a professor at Duke University School of Law who has studied director independence issues, told CMD that AIG’s failure to disclose that Rice is the lead independent director as opposed to an ordinary director at Baker Hughes could be considered “problematic,” and added that there is a “requirement [by AIG] to disclose anything that materially would impact their independence.”
“These industries are so intertwined, as evidenced by Rice having these dual roles,” Rick Morris, an insurance campaigner at Public Citizen, told CMD. “They’re sacrificing our ability to get property insurance… in order to continue to make short-term profits off of the very causes of climate change.”
LNG Expansion Accelerates on the Gulf
The Gulf Coast is one of the most burdened regions on the planet when it comes to fossil fuels, with 20 new or expanded export facilities currently being proposed or under construction. There are now eight functioning LNG export facilities in the US, but if all the proposed projects get built nationwide that number will balloon to 31.
Liquefied natural gas is mostly methane, which is 28 times more effective than CO2 at trapping heat in the atmosphere, and currently accounts for 11% of global emissions.
In 2022, a Banking on Climate Chaos report estimated that if the 18 proposed new fossil fuel export facilities on the Gulf were completed, they would generate 1.5 billion tons of greenhouse gas emissions per year, equivalent to emissions from 320 million cars.
With the growth of fracking and export infrastructure on the Gulf Coast -– along with a monumental increase in demand from Europe in the aftermath of Russia’s invasion of Ukraine in 2022 — natural gas exports have expanded rapidly, with a tripling of US exports between 2019 and 2024.
In January 2024, the Biden administration put a pause on new LNG export approvals, citing environmental and energy security concerns. A federal judge in Louisiana then blocked that pause in June of last year, but in January of this year President Trump ordered it to be lifted on the first day he returned to office. Just before the presidential transition (in December 2024), Biden’s Energy Department also released a report warning that unfettered LNG exports could drive up prices for US consumers and worsen the impacts of climate change. Trump, who campaigned on the promise to “drill, baby, drill” and push American dominance in dirty energy, has firmly rejected that approach. Instead, his administration has fast-tracked new LNG export infrastructure, allowing these exports to hit record highs as the president has tied access to US markets to foreign purchases of American LNG.
In the first quarter of 2025, AIG posted $460 million worth of losses from the fires in Los Angeles, which were exacerbated by climate change. Insure Our Future, which advocates for insurance industry accountability in climate change, estimated in December 2024 that $600 billion in property and casualty losses globally were due to climate change-related issues, which accounted for 38% of total losses in the sector.
AIG Turns a Blind Eye to Climate Risks
“AIG is one of the largest insurers of methane export terminals on the Gulf Coast,” Ethan Nuss, an organizing strategist at the Rainforest Action Network, told CMD. He cited a major disaster in August during dredging as part of the massive new Calcasieu Pass terminal, which will be one of the largest in the world. “There was a huge overflow of dredging sediment into public waterways and fishing grounds of the local fishing communities who have fished those waters for generations,” Nuss explained.
Nuss pointed out that AIG generally seems to turn a blind eye to risks when insuring the methane buildout. At one point, the company insured Freeport LNG in Freeport, Texas (also on the Gulf Coast), which experienced a major combustion event in June 2022 that “sent flames shooting 450 feet into the air, injuring beachgoers, shaking residents’ homes and sending tons of toxic chemicals into the air,” according to Melanie Oldham, a Freeport resident, in a 2023 press release.
“To this day the community has not received basic safety guarantees from the company that the problems that led to that explosion have been resolved,” Nuss said.
In response to investor pressure, AIG released what it calls a “climate roadmap” last year. Yet Nuss says that the firm has continued to prioritize its relationships with the fossil fuel industry. “AIG says that they care about climate and are in the process of developing a climate action plan, but they are actively insuring and backing this very industry that we know is incompatible with a livable climate,” he said.
Rice’s role at Baker Hughes shows that there is a “very clear relationship between AIG at a corporate level and their stake in the methane industry. The stakes couldn’t be [higher], not only for those… who live next to these dangerous terminals, with the risk of explosions and loss of livelihood and threats to their health. There’s also the threat to [our] shared climate. We know that if we have any hope of a livable climate we cannot afford to build new methane terminals, full stop,” Nuss said, citing research from the International Energy Agency to buttress his concerns about insurers’ complicity in exacerbating the crisis.
Morris of Public Citizen draws a line between AIG’s continued underwriting of fossil fuel projects amid the escalating climate crisis to its role in the 2008 financial crisis, when the company insured complex financial products that detonated the global economy, requiring a $182-billion bailout from the US government. The firm’s share price has never meaningfully recovered in the 17 years since that crisis.
“In 2008, the [world] faced a financial crash caused by speculative activities by companies like AIG,” Morris noted. “Those investments caused a crisis in the housing market [that] trickled down to affect every American and just about every country on the globe. [Now], AIG continues to play fast and loose with the US housing market [through] their investments in fossil fuels, spiking the rates that Americans pay for their home insurance. When people cannot afford home insurance, …they cannot get a mortgage to buy a home, period. When you look at AIG’s central role in the 2008 financial crisis it is difficult not to draw stark parallels to the crisis we face today.”
Morris underscored the critical role insurers play in the fossil fuel infrastructure expansion, noting that, “You can’t find investors for a fossil fuel project if that project is not insured first.” AIG — and the insurance industry as a whole — “is bent on squeezing every last cent out of the American people while abandoning them at the very time that they need to rely on their insurance.”
In a statement, Baker Hughes told CMD that the company “is committed to ethical business practices, transparency, and full compliance with all applicable disclosure obligations” — yet it failed to make its general counsel available for an interview.
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