BHP, Rio Tinto, Qantas to Invest $53 Million in Australian Carbon Credit Fund

SYDNEY (Reuters) – BHP, Rio Tinto, and Qantas are set to collectively invest A$80 million (approximately $52.7 million) as initial backers of an Australian carbon credits fund. This fund aims to target land reforestation projects, as announced by the companies and the fund on Monday.

Managed by Silva Capital—a collaboration between Roc Partners and C6 Investment Management—the fund aims to raise A$250 million to generate and oversee Australian Carbon Credit Units (ACCUs) derived from reforestation efforts.

ACCUs are provided by the Australian government’s Emissions Reduction Fund (ERF), which has a budget of $3 billion. This initiative is part of the country’s commitment to reduce carbon emissions by 43% from 2005 levels by 2030.

The ERF primarily issues credits for projects that prevent deforestation, regenerate native forests, or capture methane from landfills. These credits can be sold to the government or to companies that are working to achieve their emission reduction goals.

As companies in high-emission sectors, such as mining and aviation, increasingly seek carbon credits for offsetting their emissions, this investment is particularly relevant.

"This fund symbolizes not just an investment in reducing carbon emissions but also a crucial step in Australia’s carbon market, which will importantly bolster the long-term viability of our farming communities and ecological restoration efforts," stated Raphael Wood, Co-Managing Director of Silva Capital.

Silva Capital also has intentions to invest in agricultural lands to establish substantial carbon sequestration projects that encourage sustainable practices in farming and land management, Wood further noted.