More than 63,000 acres of north Louisiana forestland are part of a new 10-year deal to sell carbon credits to a French petrochemical and natural gas exporter with operations in the Baton Rouge area and southwest Louisiana.
And the chief executive officer of the carbon credit company that was part of the deal says he expects continued interest from big industrial companies in voluntary credit sales involving Louisiana forests, though U.S. environmental policy is beginning to shift away from climate regulation.
TotalEnergies has inked the deal with the Arkansas-based NativState to enroll in 13 long-term forest management plans across 247,000 acres in Louisiana and three other states, officials with both companies said.
TotalEnergies says it is trying to avoid or cut greenhouse gas emissions where it can — including with permanent underground carbon storage — and offset the rest by investing $100 million annually in projects that will be able to generate at least 5 million metric tons of carbon credits per year by 2030.
The NativState deal, the value of which was not disclosed, is part of TotalEnergies’ buildout of that carbon offset portfolio, which is also expected to include agriculture and wetlands protection projects, company officials said in a statement.
“We are working to build a high-quality portfolio and are paying close attention to the integrity and permanence of the emissions reductions and sequestration achieved by the activities financed in this way,” said Gabin Poizat, a TotalEnergies spokesperson.
‘Some give and take’
The company, which has the world’s largest combined styrene and polystyrene manufacturing plant in Carville, says it already has 1 gigawatt of renewable energy under development to supply electricity to U.S. petrochemical sites, including in Carville, a Port Arthur, Texas, oil refinery, and plastics manufacturing in LaPorte, Texas.
NativState aggregates smaller timber properties to create economies of scale and, in long-term deals reached with landowners, sets up reduced harvesting practices to create a net savings in carbon emissions.
The deal with TotalEnergies involved more than 280 landowners in Louisiana, Mississippi, Arkansas and Tennessee in a portion of the nation where there is aggressive timber harvesting, NativState officials said.
Landowners agreed to 40-year sustainable management programs with help from NativState’s foresters and wildlife biologists that will reduce but not eliminate harvests.
Those carbon savings are sold as voluntary credits to companies and are verified by third-party auditing. Landowners earn credit royalties while still being able to harvest some of their timber, NativState officials said.
“So, there’s some give and take there, but, in the end, in most cases, that landowner is getting as much, if not more, between the carbon credits and timber revenues on these properties,” said Stuart Allen, founder and chief executive officer of NativState.
‘Political pressures’
The TotalEnergies agreement is NativStat’s fourth large credit deal. Louisiana landowners have already started earning royalty payments from earlier deals, company officials said.
The companies announced the latest deal late last month shortly before the U.S. Environmental Protection Agency said it was planning to rescind the so-called endangerment finding for greenhouse gases known to contribute to climate change.
The finding is a key underpinning for the climate regulations that have followed in the 16 years since it was reached in 2009. The proposed change is part of a wider deregulatory effort by the Trump administration to spur energy and industrial production and cut consumer prices.
Allen, the NativState CEO, said Thursday that while shifting U.S. regulations may affect interest in carbon credits from smaller, domestic companies, it’s not affecting the large international companies with which he is dealing.
They have 25-year planning horizons, he said, that extend past any single administration and face different business pressures than in the United States. Corporate officials from Indonesia, Japan and other countries have visited Arkansas and Louisiana prospecting for carbon deals, he said.
“And we bring groups in and their view on carbon and climate change and the political pressures on them or corporate investor pressures are considerably different than what we’ve seen here in the U.S., in some cases. And so I think the majority, we’re not seeing any lack of demand from global players,” Allen said.
Based in Paris, TotalEnergies has a mix of renewable and fossil fuel operations across the United States and the globe.
Also invested in solar, wind and related battery operations in the United States, the multinational has interests in Gulf oil platforms and is a leading exporter of U.S. natural gas with a stake in the Cameron LNG facility in Hackberry in southwest Louisiana.
