Diversified chemicals group Omnia said on Tuesday it was confident of finding buyers for its carbon credits post-2012, when the first commitment period under the Kyoto Protocol comes to an end.
There is currently uncertainty over the fate of the Kyoto Protocol, which is the only regulation in place for the buying of carbon credits, with Canada, Japan and Russia having indicated that they would not sign onto an extension. This means that there could be a period where there would be no legally binding, concrete greenhouse gas mitigation commitments applicable to Kyoto Protocol signatories.
Speaking at Omnia’s results presentation in Johannesburg, CEO Rod Humphris said that the company still had lots of interest in its carbon credits, specifically from European buyers, post-2012.
Omnia generates its carbon credits, known as Certified Emission Reductions (CERs), from its fertiliser business, and sell them onto international buyers in developed countries.
During its 2010 financial year, Omnia generated about R50-million through the sale of carbon credits. While it did not receive any revenue in 2011 from carbon credits, Humpris said that this benefit would flow through to its 2012 financial year.
He estimated that revenue from carbon credits would be similar to that of 2010.
The company would also be able to generate additional carbon credits from its R1.4-billion nitric acid plant, which is currently under construction and expected to be completed by the first quarter of 2012.