BY ROSEMARY IWUALA
The Nigeria Sovereign Investment Authority (NSIA) and Vitol, a multinational oil supply company, have sealed an agreement to establish a joint venture that will enable both firms to invest in a range of carbon avoidance and removal projects.
This will enable the two organisations to invest exclusively in projects in Nigeria, partnering with local Non-Governmental Organisations (NGOs) which have had experience in such high-quality projects that have contributed to the United Nations Sustainable Development Goals.
Both NSIA and Vitol are expected to make an initial commitment of $50 million to this new venture.
A statement signed by officials of both organisations said the new venture is now open to new investors as the partners develop the project pipeline.
The initiative will seek to mobilise voluntary market carbon capital from the partners and potential third parties in a small step toward a more equitable energy transition for Africa, according to the NSIA.
Uche Orji, managing director/CEO of NSIA, said the partnership with Vitol would be key to establishing and accelerating carbon reduction and avoidance in Nigeria, and that his agency was committed to playing a leading role in advancing climate solutions that help to lower Nigeria’s carbon emission as an integral part of ESG strategy.
This, he said, would be achieved by providing an enabling platform to trade carbon credits.
“We are therefore very pleased to be working with Vitol to channel our investments in sustainable projects to deliver emission-reduction results as well as significant socio-economic outcomes that will be of benefit to Nigerians,” Orji said.
Michael Curran, head of environmental products at Vitol, said the company, which has been investing in high-quality carbon mitigating projects globally for over 10 years with a recent focus on sub-Saharan Africa, was delighted to partner with the NSIA to support Nigeria’s efforts to reduce greenhouse gas emissions through projects that address critical environmental and climate threats.
Curran said the projects would have a clear focus on delivering social benefits, alongside the highest standards of carbon offsetting.
“Used appropriately as part of a comprehensive corporate energy transition strategy, offsetting will play a key role in meeting the Paris Climate Agreement objectives and contribute toward the UN Sustainable Development Goals,” he said.
The NSIA is an investment institution of the Nigerian government set up to manage funds in excess of budgeted hydrocarbon revenues. Its mission is to play a leading role in driving sustained economic development for the benefit of all Nigerians through building a savings base for the Nigerian people, enhancing the development of Nigeria’s infrastructure, and providing stabilization support in times of economic stress.