Petrobras to buy BRL 450M in carbon credits in Amazon
A partnership between Petrobras and the National Bank for Economic and Social Development (BNDES) aims to establish an initial carbon credit market worth at least BRL 450 million, specifically focused on forest restoration in the Amazon.
The memorandum of understanding between the two institutions was signed on Monday (Mar. 31) at Petrobras’ headquarters in Rio de Janeiro by the company’s president, Magda Chambriard, and BNDES president, Aloizio Mercadante. The initiative has been named ProFloresta+.
The initial amount of BRL 450 million corresponds to what Petrobras will disburse by buying the carbon credits. BNDES will have the role of granting loans for projects dedicated to restoring Amazonian areas.
The loan will be provided through the Climate Fund, which offers an interest rate of 1 percent per year. In comparison, the country’s basic interest rate, the Selic, which serves as a benchmark for loan operations, stands at 14.25 percent per year.
BNDES is a public bank d with the Ministry of Development, Industry, Trade, and Services, dedicated to promoting development initiatives, often by financing projects at lower interest rates.
25 million trees to be planted
The initial BRL 450 million will be allocated for restoration projects covering at least 3,000 hectares. Petrobras aims to five projects, totaling 15,000 hectares, which is expected to result in the planting of approximately 25 million trees. The company estimates that these projects will create around 1,700 jobs.
In its presentation of ProFloresta+, Petrobras estimated that, over 25 years, the project could cover 50,000 hectares (500 km²) with an investment of BRL 1.5 billion, capturing approximately 15 million tons of carbon—equivalent to the annual emissions of 8.94 million gasoline-powered cars.
For Chambriard this is an ambitious initiative. “We’re talking about a true green revolution. This is a structuring project for the climate,” she stated.
BNDES s other initiatives to preserve the forest, but the program launched on Monday is specifically focused on restoring and expanding native vegetation cover.
The carbon market
Carbon dioxide (CO2) is one of the main causes of the greenhouse effect and contributes to warming the planet’s temperature.
The carbon market consists of buying and selling credits to offset pollution liabilities. For example, an environmental project that reforests deforested areas or preserves nature contributes to preventing CO2 from reaching the atmosphere—this process is known as carbon sequestration.
This carbon sequestration generates credits that can be traded. On the other side of the market, companies whose economic activities produce CO2 emissions can purchase these credits to offset their environmental impact.
In December of last year, Brazil enacted a law regulating the carbon market.
