Baker & McKenzie has advised R.M. Williams Agricultural Holdings (RMWAH) on a landmark deal that directly engages the carbon market to fund the large-scale restoration of our National Reserve System.
The Henbury Conservation Project was launched in the Northern Territory by the Federal Environment Minister, Tony Burke, on 26 July 2011.
RMWAH purchased Henbury cattle station, around 130 kilometres south of Alice Springs, for $13 million, with the help of the Federal Government under the Caring for Country program. It is the first time that a private sector company has undertaken such an endeavour, with the intention to fund the conservation from the sale of carbon rights and biodiversity values.
Under the project, cattle will be permanently removed from the property and a conservation program will be implemented, with the expectation of generating up to 1.5 million carbon credits a year, enabling the restoration of the Henbury landscape and protecting several endangered species. This will be achieved through working with the traditional owners.
This is the first time a business is attempting to establish a model for carbon farming and at the same time meet international benchmarks for long-term biodiversity conservation of a rare and underrepresented bioregion in Australia's National Reserve System.
Baker & McKenzie partner and global head of the firm's environmental markets practice Martijn Wilder represented RMWAH and will be chair of the independent committee to oversee the project. "This is a significant deal, as it is the first time private capital has been attracted to such a conservation scheme, that traditionally is the province of philanthropic ventures," he said. "It's the first time a private company has worked with the Government to buy a property to put into the National Reserve System and fund it with carbon rights. It will feed directly into the Government's carbon farming initiative and carbon pricing policy."
Wilder said the negotiations with the Federal Government were complex, given that such a project and the associated funding models had never before been attempted. "The completion of the transaction was a significant accomplishment in itself and one of which all parties can be very proud," he said. "Hopefully this will pave the way for more such projects in the future."
Wilder was assisted by senior associates Kate Phillips and Ilona Millar.