The federal government-financed Clean Energy Finance Corporation (CEFC) is to invest in an $81 million plantation forestry project expected to become one of Australia’s largest nature-based carbon offset initiatives.
The project, on the Tiwi Islands, north of Darwin, will also provide employment and training for people in local Aboriginal communities.
CEFC is investing up to $40 million in the First Nations-led initiative alongside Melbourne-based multi-asset investment firm River Capital.
The investment will back community-owned business Tiwi Plantations Corporation which is planting native species for a long-rotation program that will produce timber and generate Australian Carbon Credit Units (ACCUs). The project will be managed by plantation and carbon management investment company, Midway Pty Ltd.
Tiwi Plantations Corporation is owned and operated by the Tiwi Islands’ eight clan groups. Growing and harvesting timber is expected to deliver substantial economic benefits to the community.
Chair of the Tiwi Plantations Corporation, Kim Puruntatameri, said: “We've got to look after the land very well for the next generation coming. To keep the environment strong, we need to work together with people from outside.”
Head of Natural Capital for CEFC Heechung Sung said the initiative was already developing a forestry industry which should drive economic opportunities for generations.
The project has national economic significance. The planting of 30,000 hectares of Eucalyptus pellita trees, native to north-eastern Queensland, is projected to increase Australia’s total area of timber plantations by around 2% helping to meet international demand for high quality timber for building construction. Over the life of the plantation, it is estimated around 12 million cubic metres of timber will be harvested and five million nature-based ACCUs will be generated.
Co-founder of River Capital, Suzi Carp, said: “We are proud to be involved in this transformational project. This investment is a rare opportunity to deliver financial, environmental and social impact, at scale.”
The first two stages of the project have already been registered with the Clean Energy Regulator for an estimated 865,000 ACCUs.
Image: Tiwi islanders working on raising seedlings to plant out for the plantation forests.