Tencent Holdings (TCEHY), a Chinese technology company, has signed a 10-year agreement to buy 300,000 carbon removal credits from Thryve.Earth, a Singapore-based carbon developer, marking Tencent's first carbon removal credit deal outside China. The credits will come from an agroforestry project on Sulawesi in Indonesia, where degraded land is expected to be restored through a mixed crop farming system that sequesters carbon, improves soil quality, increases biodiversity, and provides income for local farmers. Tencent said carbon removal will play an important role in its goal to reach carbon neutrality across its own operations and supply chain by 2030, while emphasizing that reducing emissions remains its main priority.
Alphabet, the parent company of Google NASDAQ:GOOG, has also entered a separate 10-year offtake agreement for 260,000 credits from the same Sulawesi project, while McKinsey & Co., a consulting firm, agreed to buy 75,000 credits. For Google, the agreement represents its largest carbon removal offtake deal to date and follows its participation in a new $915 million commitment for carbon dioxide removal technologies. Randy Spock, Google's head of carbon credits and removals, said the company now has a portfolio of more than 1.6 million tons of carbon dioxide removal credits, suggesting Google is continuing to build exposure across different types of carbon removal projects.
Investors may view the Sulawesi agreements as a sign that major corporate buyers are still willing to support high-quality nature-based carbon removal, even after Microsoft, a technology company that is part of the Symbiosis Coalition, pulled back earlier this year. The average price for agroforestry credits in Asia is currently around $21.40, according to Sylvera, while agroforestry projects could potentially deliver up to 310 million tons of carbon-dioxide removal each year. The deals also come less than a year after Indonesia lifted a moratorium imposed in 2021 on the sale of new carbon credits to foreign buyers, which may make the project more relevant for investors tracking the carbon credit market and corporate climate spending.