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Brazil's Petrobras and BNDES partners to buy carbon credits for Amazon region

Brazil's Petrobras and BNDES partners to buy carbon credits for Amazon region

The partners announced on Monday that Brazil's state oil company Petrobras, and Brazil's development banking institution BNDES had partnered to create a financing program for forest restoration initiatives in Amazonia.

Petrobras, under the ProFloresta+ Program, will hold tenders for carbon credits generated by restoration projects. The winning bidders can apply for low-interest loans to establish projects from BNDES.

The pilot phase of the program is expected to generate investments of 450 million reais (78.45 millions) for restoration. This will lead to the replanting and regrowth of 15,000 hectares of forest.

Petrobras is expecting to sign contracts for long-term with up to 15 companies that will participate in an auction scheduled to take place in July.

Magda Chabriard, Petrobras Chief Executive said that the company would open the door to green entrepreneurs obtaining subsidized credits. She added that the tender will establish the benchmark price of carbon credits from Brazilian restoration projects.

Carbon credits are permits that can be traded to allow the owner of the credit to emit a certain amount of greenhouse gases. Each carbon credit allows the emission of 1 metric ton or equivalent in other greenhouse gases.

Petrobras began buying carbon credits when it announced that it would offset carbon emissions by using its premium gasoline Gasolina Podium in 2023.

(source: Reuters)