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Brazil's Tocantins state to offer $430 million in carbon credits

A Brazilian state that straddles the frontier of the Amazon jungle is pursuing the sale of more than 2.5 billion reais ($ 430.16 million) in carbon credits associated with forest conservation through 2030, the state government stated on Thursday.

Business generally buy such credits to balance out a part of their greenhouse gas emissions in pursuit of voluntary goals to curb international warming, essentially spending for projects that cut climate pollution.

Tocantins specify objectives to sell some 50 million carbon credits, each totaling up to one metric ton of carbon sequestered by forests and other native vegetation across the state through the end of the decade, the federal government stated in a declaration.

The worth and variety of carbon credits is contingent on the state successfully lowering deforestation, it stated. The state government specifically shared details of its scheduled issuance of carbon credits with Reuters ahead of the official announcement.

Scientists state protection of the Amazon rain forest is important to suppressing environment change because of the vast amount of carbon dioxide its trees take in.

Brazil's federal government revealed last week that deforestation in Brazil's Amazon in the 12 months through July had been up to the lowest level given that 2015.

Tocantins will submit its documents on Thursday to verify the task under the ART-TREES carbon credit standard, formally providing the project at the United Nations COP29 environment top in Azerbaijan.

Products trading firm Mercuria is coordinating the sale.

The submission will want to accredit 17 million to 18 million credits for carbon sequestered from 2020 to 2024, not consisting of credits reserved in case of wildfires or for other contingencies, a person knowledgeable about the offer informed Reuters.

Those might be worth a minimum of 850 million reais, based on the federal government's total assessment of the offer.

The sale of that batch of credits will likely close in the second half of 2025, the person stated on condition of anonymity, as those information are not public.

The number of credits included overshadows deals this year by Microsoft, Google and Meta to purchase forestry carbon credits in Brazil, and likewise exceeds the Para state government's agreement to offer credits to a group of companies consisting of Amazon.

(source: Reuters)