TORONTO, April 08, 2024 (GLOBE NEWSWIRE) -- Base Carbon Inc. (Cboe CA: BCBN) (OTCQX: BCBNF) with operations through its wholly-owned subsidiary, Base Carbon Capital Partners Corp. (“BCCPC”, together, with affiliates, “Base Carbon”, or the “Company”), is pleased to announce that it has received an initial transfer of 717,558 correspondingly adjusted carbon credits from its Rwanda cookstoves project, each designated by Verra with an article 6 authorized (“Article 6 Authorized”) label. Receipt of these carbon credits from the Rwanda cookstoves project is an important Company milestone, marking Base Carbon’s second project to transition from the development stage to active carbon credit generation, as well as an important industry milestone, being the first Article 6 Authorized labeled carbon credits issued by Verra.
Highlights:
- Rwanda cookstoves project has successfully transitioned to the carbon credit generation stage, with regular future issuances expected at semi-annual intervals.
- 717,558 Article 6 Authorized labeled carbon credits have been transferred to the Company.
- The carbon credits transferred to the Company are part of Verra’s first ever correspondingly adjusted Article 6 Authorized carbon credits.
- The Company believes that the correspondingly adjusted carbon credits with Verra’s Article 6 Authorized designation will expand the pool of buyers with potential pricing upside.
As first announced in December 2023, the Government of Rwanda issued a letter of authorization (“LOA”) with respect to the Rwanda cookstoves project resulting in Verra announcing it had applied its Article 6 Authorized label to the project, being the first time Verra had applied such designation to a carbon project registered in its Verified Carbon Standard Program.
BCCPC and the DelAgua Group (“DelAgua”), the project developer, have been engaged in discussions as to the best implementation of the LOA. According to the LOA, a copy of which may be found on Verra’s website under project ID 4150, 2% of any issued Article 6 Authorized labeled carbon credit are to be immediately retired to help offset global emissions, 10% of such carbon credits are to be transferred to the Government of Rwanda to help achieve its nationally determined emission reduction targets, and 5% of net revenues generated from the sale of the remaining Article 6 Authorized labeled carbon credits issued will be remitted to United Nations’ global adaptation fund (“GAF”).
BCCPC and DelAgua have recently executed an amended and restated project agreement to facilitate the implementation of the LOA. Under the terms of the revised agreement, BCCPC and DelAgua have agreed to split the 5% GAF remittance attributable to Article 6 Authorized labeled carbon credits sold based upon each party’s pro rata share of sales proceeds outlined in a revenue sharing arrangement between the parties. The Company’s GAF remittance is currently anticipated to be US$0.20 per credit for the first 1,925,000 Article 6 Authorized labeled carbon credits received by BCCPC.
Under the revised project agreement, Article 6 Authorized labeled carbon credits issued from the Rwanda cookstoves project will be net of the 12% volume reduction outlined in the Government of Rwanda LOA. Based upon on this, and assuming all carbon credits from the Rwanda cookstoves project were issued with an Article 6 Authorized label, a new and revised aggregate minimum of 6.6 million carbon credits would now be subject to the revenue sharing arrangement between BCCPC and DelAgua. The Company is currently evaluating all sales options with respect to the initial 717,558 carbon credits and believes that the potential pricing upside of correspondingly adjusted carbon credits will significantly offset any volume reductions pursuant to the implementation of the LOA.
About Base Carbon
Base Carbon is a financier of projects involved primarily in the global voluntary carbon markets. We endeavor to be the preferred carbon project partner in providing capital and management resources to carbon removal and abatement projects globally and, where appropriate, will utilize technologies within the evolving environmental industries to enhance efficiencies, commercial credibility, and trading transparency. For more information, please visit www.basecarbon.com.
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Cautionary Statement Regarding Forward Looking Information
This press release contains “forward-looking information” within the meaning of applicable securities laws relating to the focus of Base Carbon’s business, the expected continued semi-annual issuances of carbon credits, the implementation of, and compliance with, Article 6 of the Paris Agreement by the Government of Rwanda, the continued designation of project carbon credits with the Article 6 Authorized label by Verra and the expected market reaction to such carbon credits. In some cases, but not necessarily in all cases, forward-looking information may be identified by the use of forward-looking terminology such as “expects”, “anticipates”, “intends”, “contemplates”, “believes”, “projects”, “plans” or variations of such words and similar expressions or state that certain actions, events or results “may”, “could”, “would”, “might”, “will” or “will be taken”, “occur” or “be achieved”. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances contain forward-looking information. Statements containing forward-looking information are not historical facts but instead represent management’s expectations, estimates and projections regarding future events. These statements should not be read as guarantees of future performance, results, or achievements.
Although management believes that the anticipated future results, performance or achievements expressed or implied by the forward-looking information are based upon reasonable assumptions and expectations, readers should not place undue reliance on forward-looking information because it involves assumptions, known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to differ materially from anticipated future results, performance or achievements expressed or implied by such forward-looking information.
In respect of the Rwanda cookstoves project, certain factors that influence the commercial success of such project and successfully meeting the milestones related to such project, including the timing and number of expected carbon credits, include, but not limited to, among other things: (i) the Company has retained industry leading experts/consultants/advisors to assist with the continuing monitoring and evaluation of such project, (ii) the work product, including monitoring reports, of the project’s validation and verification Body, (iii) carbon credit market prices, (iv) the verification of ongoing project monitoring reports and issuance of carbon credits by Verra, and (v) changes to laws and regulation in applicable jurisdictions.
In respect of the Rwanda cookstoves project, certain assumptions that influence the commercial success of such project, including the timing and number of expected carbon credits, include, but not limited to, among other things: (i) distributed cookstoves perform to specification when used and participating households use the devices as contemplated by project estimates, (ii) the Company’s in-country project partner, being the DelAgua, performs its obligations in connection with the operation of the project, (iii) continued support of the project and compliance with LOA by the Government of Rwanda, and (iv) continued participant involvement and public support of the voluntary carbon market.
The forward-looking statements made herein are subject to a variety of risk factors and uncertainties, many of which are beyond the Company’s control, which could cause actual events or results to differ materially and adversely from those reflected in the forward-looking statements. Readers are cautioned that forward-looking statements are not guarantees of future performance. Specific reference is made to the management discussion and analysis for the Company’s fiscal year ended December 31, 2023 and the most recent Annual Information Form on file with the Canadian provincial securities regulatory authorities (and available on www.sedarplus.ca) for a more detailed discussion of some of the factors underlying forward-looking statements and the risks that may affect the Company’s ability to achieve the expectations set forth in the forward-looking statements contained in this press release.
Should one or more of the risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual events or results may vary materially and adversely from those described in the forward-looking information. The forward-looking information contained in this press release is provided as of the date of this press release, and the Company expressly disclaims any obligation to update or alter statements containing any forward-looking information, or the factors or assumptions underlying them, whether as a result of new information, future events or otherwise, except as required by law.
