$53 Million Will Be Invested By BHP, Rio Tinto, And Qantas In The Australian Carbon Credit Fund

According to statements released by the fund and the companies on Monday, BHP (BHP.AX), Rio Tinto (RIO.AX), and Qantas (QAN.AX) will invest a total of A$80 million ($52.7 million) as early-stage investors in an Australian carbon credits fund that aims to invest in land reforestation projects. 

Australian Carbon Credit Units (ACCUs) from reforestation programs will be generated and managed by Silva Capital, a joint venture between Roc Partners and C6 Investment Management. The fund seeks to raise A$250 million to fund this initiative.

Reducing The Carbon Emissions

The $3 billion Emissions Reduction Fund (ERF) of the Australian government issues ACCUs in an effort to assist the nation in reducing its carbon emissions by 43% since 2005.

Projects that prevent deforestation, restore natural forests, or gather methane from landfills are primarily given credits by the ERF. These initiatives have the ability to offer credits to the government or businesses trying to reach their carbon reduction goals.

Businesses that operate in high-emitting sectors of the economy, including as mining and aviation, are more and more looking to purchase carbon credits in order to purchase emissions offsets.

Repairing The Nature

In a statement, Silva Capital Co-Managing Director Raphael Wood said, “This fund represents not only an investment in carbon abatement but also a significant milestone in Australia’s carbon market, that will, importantly, support the long-term success of our farming communities and nature repair.”

According to Wood, Silva Capital intends to make investments in agricultural land in order to create sizable carbon sequestration projects that support environmentally friendly farming and land management techniques.