London — Shell Australia will fully acquire specialist carbon emissions offsetting company Select Carbon, the company said August 3.
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The move is Shell's first acquisition for its nature-focused business division which invests in forests, grasslands, wetlands and other natural ecosystems around the world.
"The scale of Australia's rangelands, ecological diversity and integrity of intact primary forests make this market a natural choice for Shell's first acquisition globally for our Nature-Based Solutions business and to further scale Shell's investment in this area here in Australia," Shell Australia Chairman Tony Nunan said in a statement.
Select Carbon partners with farmers and other landowners to develop carbon farming projects throughout Australia which aim to reduce emissions and capture CO2 while benefiting biodiversity and local communities, Shell said.
The acquisition will contribute to Shell's ambition to be a net-zero emissions energy business by 2050 or sooner.
"This ambition also involves working with customers to reduce or offset the emissions generated when they use Shell products, such as through the use of carbon credits," the company said.
Select Carbon has developed and manages a portfolio of over 70 projects covering 9 million hectares across various ecosystems and agricultural uses in Australia.
Carbon farming uses agricultural and land management practices that capture carbon in vegetation and soils or reduce greenhouse gas emissions. By using the correct land management practices, farms can transition from being net carbon emitters to carbon sinks.
The carbon credits generated through Select Carbon's projects are offered through the Australian government's Emissions Reduction Fund and other markets, creating an additional revenue stream for farmers and landowners, Shell said.
Each Australian Carbon Credit Unit generated through Select Carbon's projects represents the avoidance or removal of 1 mt of carbon dioxide and is eligible to participate in the Australian Federal government's Emissions Reduction Fund.
Australia continues to be a priority market for Shell's investment in new energy generation, offering a combination of strong growth in renewables, access to natural gas and customer demand for low-carbon energy solutions, it said.
The new acquisition complements Shell's moves into diversified and emerging energy technologies, including the acquisition of Australian commercial and industrial energy retailer ERM Power; the acquisition of Sonnen – a German company with operations in Adelaide that provides battery storage systems and solar panels for homes in Germany, Italy, the US and Australia; investing a 49% stake in Australian solar developer, ESCO Pacific; and building Shell's first industrial-scale solar power farm in central Queensland.
The acquisition of Select Carbon is expected to be completed before the end of 2020 and is subject to Australian regulatory approval, Shell said.