Carbon Streaming Corp (NEO: NETZ) this morning announced its latest carbon streaming arrangement. The latest agreement has been entered into with that of Infinite-EARTH, the developer of the Rimba Raya Biodiversity Reserve Project, which is already producing annual carbon credits.
The project itself is viewed as the flagship REDD+ project, which refers to “reducing emissions from deforestation and forest degradation.” The project is expected to produce 3.5 million carbon credits per year, equating to roughly 70 million credits that are to be made over the remaining 20 year lifespan of the project. The Rimba Raya project focuses on protecting and preserving tropical lowland peat swamp forests in Borneo.
Perhaps most significantly, Carbon Streaming has entered into an arrangement with InfiniteEarth to acquire 100% of the carbon credits created by project over the next 20 years, less 635,000 credits annually which are already committed. The arrangement will notably see 1.0 million credits per year in the first four years delivered at a pre-agreed sale price of US$8.50 per each.
“As indicated by the long list of top-tier companies that have already purchased carbon credits from the Rimba Raya Project, we believe the carbon credits generated by this project will continue to be highly valuable and sought-after as more companies begin their carbon offset process and look to purchase carbon credits from high-quality REDD+ projects like the Rimba Raya Project, which offers substantial climate, community and biodiversity benefits.”
Justin Cochrane, CEO
In exchange for the carbon credit stream, the company will pay US$22.3 million, while also making ongoing payments to InfiniteEARTH for each credit sold under the streaming arrangement.
Sponsored · Silver47 Exploration Inc.
Additionally, Carbon Streaming has entered into a strategic alliance agreement with the founders of InfiniteEARTH, which will see them provide consulting services to the company, including marketing and sales services, advisory services, and assistance with due diligence. The company also has the right of first refusal on any stream or royalty financing transaction which have the potential for over 18 million credits per year.
As consideration for the strategic agreement, the company will pay US$4.0 million, as well as issue 22.7 million common shares to the founders, the latter of which are to be sued to develop a portfolio of blue carbon projects in the Americas.
Closing of the acquisition of the carbon stream is expected to occur within the next two weeks.
Carbon Streaming Corp last traded at $1.70 on the Neo Exchange.
FULL DISCLOSURE: Carbon Streaming Corp is a client of Canacom Group, the parent company of The Deep Dive. The author has been compensated to cover Carbon Streaming Corp on The Deep Dive, with The Deep Dive having full editorial control. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security.
