Hess Corporation secures purchase of 30% of carbon credits made available to Guyana from 2016- 2020

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Permanent Secretary of the Ministry of the Presidency, Abena Moore and Chief Executive Officer of Hess Corporation, John Hess signing the agreement in the presence of President Irfaan Ali and other officials

Guyana on Thursday became the first country to be issued carbon credits under the Architecture for Reducing Emissions from Deforestation and Degradation (REDD+) Transactions (ART) framework, totalling 33.47 million. 30% of the carbon credits have been sold to Hess Corporation and as part of the agreement, the oil giant will invest heavily between 2022 and 2032 to purchase high-quality REDD+ carbon credits.

At the signing ceremony at State House on Friday, President Irfaan Ali disclosed that efforts championed by a team from the Low Carbon Development Strategy Unit and the Guyana Forestry Commission led to Guyana copping one of the largest issuances of carbon credits in the world. 

The historic agreement, he divulged, will see the Hess Corporation purchasing 2.5 million carbon credits annually. 

“This agreement represents credits between 2016 and 2030 to a value of 750 million United States dollars,” President Ali noted. 

The Head of State underscored that his Government’s commitment to fighting climate change and sustainable development will not be side-stepped.

Guyana’s Low Carbon Development Strategy 2030 comprises the creation of a new low-carbon economy by establishing incentives which value the world’s ecosystem services including its forest. 80% of Guyana is said to be covered by forests that currently store more than 19 gigatonnes of carbon and are attached to a value of more than US$500bn. The country has also pledged to join the rest of the world in ending deforestation by 2030.

12.5 million of the carbon credits Guyana received are considered legacy credits that date back to 2016, the president divulged. 

Chief Executive Officer of Hess Corporation, John Hess said that the agreement will serve to protect the country’s vast forests, one of the largest carbon sinks in the world and to provide capital to improve the lives of Guyanese through investments made by the Government as part of its low carbon development strategy. 

“This agreement adds to our company’s ongoing and successful emissions reduction efforts and is an important part of our commitment to achieve net zero and greenhouse gas emissions by 2050,” he stated. 

Carbon credits are considered a permit that represents 1 ton of carbon dioxide removed from the atmosphere. They can be purchased by an individual or, more commonly, a company to make up for carbon dioxide emissions that come from industrial production, delivery vehicles, or travel.

Carbon credits are often created through agricultural or forestry practices, as well as any project that destroys or captures emissions. 

(REDD+) is a global mechanism created by the Conference of the Parties to the United Nations Framework Convention on Climate Change (UNFCCC) that supports activities in the forest sector to reduce emissions from deforestation and forest degradation.

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