East Asia Minerals Corporation, an Asian mining company, has acquired a 50% stake in Carbon Conservation, a Australian company that developed one of the world’s first forest conservation projects funded by carbon credits, for $500,000, according to a press release from the mining company.
East Asia Minerals, which is listed on the Toronto Stock Exchange, operates gold and gold-copper mines in Aceh Province on Sumatra and Sangihe Island off North Sulawesi. It also owns seven uranium properties and two phosphate properties in Mongolia.
East Asia Minerals says the investment will fund a ‘green’ mining project.
“The Company will develop a ‘green’ mining project which will use carbon and biodiversity offsets and the latest in environmentally friendly mining practices,” East Asia Minerals said in a statement. “In the process, the Company will participate in developing a ‘green’ brand for its Miwah project which will potentially allow it to command a premium for its product in the market as well as to potentially facilitate a smoother process for approval of, and support for, mining permits.”
Carbon Conservation made a name for itself in 2007 when its carbon conservation project in Aceh’s Ulu Masen in Aceh Province of Sumatra became the first to win validation under the Climate Community and Biodiversity Alliance Standards for its reduced emissions from deforestation and degradation (REDD) program. The project — which received a $9 million investment from Merrill Lynch (now part of Bank of America) — aims to offset roughly 100 million tons of carbon dioxide emissions by reducing deforestation across 700,000 hectares of tropical forest.
But Carbon Conservation has since endured criticism over the design and implementation of the project while suffering from adverse market conditions — the market for forest carbon offsets has been slower than expected to materialize. The company courted controversy last year when it signed an agreement with Asia Pulp & Paper, which environmentalists say has destroyed vast tracts of forest in Sumatra, putting endangered wildlife at risk and exacerbating social conflict.