A Canadian developer pre-sold Sierra Leonean reforestation carbon credits for $2.5 million.

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By Renewal News Network Reporter

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A Canadian developer reportedly pre-sold their Sierra Leone reforestation credits, according to Carbon Pulse, a publication focused on carbon markets, greenhouse gas pricing, and climate policy. The June 15 edition of the online publication maintained that a “Canadian-based developer has finalised a $2.5 million pre-sale of African reforestation credits to a mystery buyer.” The Canadian firm intends to begin a rewilding initiative in Sierra Leone. Selling "yet-to-be-generated carbon credits" to a "Fortune 100 company" in advance will bring in much-needed capital for the project.

Getting their first physical project off the ground is a common struggle for businesses and nonprofits dedicated to carbon mitigation and reduction. This fact has been acknowledged by investors and international environmental organisations, opening the door for the pre-sale of carbon credits. According to a group of researchers at the Stockholm Environment Institute, "Given the risks and uncertainties of the carbon market, it is rare for a project that truly needs offset credit revenue to go forward without first securing buyers for some or all of the credits it expects to produce... Forward contracts generally take the form of “emission reduction purchase agreements (ERPAs).” [From Broekhoff, Derik, et al. (2020) Securing Climate Benefits: A Guide to Using Carbon Offsets p 22:]