Carbon Streaming agrees US$6 million exit from Community Carbon stream

• Total consideration is US$6.0 million.
• US$2.35 million has already been received from a credit sale.
• The company says the stream will end after escrow funds are released.

Carbon Streaming Corp. has entered into an agreement with Community Carbon and UpEnergy Group for total consideration of US$6.0 million. The deal covers termination of the Community Carbon Stream and transfer of the company’s remaining carbon-credit portfolio.

Carbon Streaming agrees US$6 million exit from Community Carbon stream

The company said the US$6.0 million is made up of US$2.35 million from its own sale of CORSIA-tagged Tanzanian cookstove carbon credits, US$1.47 million from sales by the UPE Parties that will be placed in escrow, and US$2.18 million deposited by the UPE Parties into escrow.

Carbon Streaming said release of the escrowed funds remains subject to the agreement’s closing conditions, including confirmation by the escrow agent that it holds the full escrow amount. The company has already received US$2.35 million, with the remaining US$3.65 million to come from escrow.

It expects the transaction to fully close and for the full US$6.0 million to be received within 10 business days, subject to those conditions.

After release of the escrowed funds, the company will transfer its remaining inventory of carbon credits under the Community Carbon Stream. The stream will be terminated and the parties will grant mutual releases of future obligations.

Chief executive Marin Katusa said the previously announced transaction with UPE failed because UPE financing did not close. He said the new structure gives the company the full US$6 million upfront rather than over 12 months, and removes financing and credit-pricing risk for the company.

Katusa said the current carbon-credit market remains challenging. He said CORSIA-tagged credits have been liquid and have sold for above US$8 per credit, while non-CORSIA-tagged credits in the portfolio have seen limited to no buyer interest over the last 12 months.

He also said the company will continue to focus resources on maximising value for shareholders in its existing portfolio and pursuing recovery of assets through ongoing litigation.

Carbon Streaming said it has filed a statement of claim against certain former executives, board members, consultants and associated entities. It said certain defendants have filed counterclaims and that it has filed a defence to those counterclaims.

The company said it will continue to evaluate acquisitions, divestments, corporate transactions, financings and other strategic partnership opportunities that would maximise shareholder value.