Astute leadership delivers massive carbon credits deal for Guyana

Dear Editor,
On December 2, 2022, Guyana and Hess Corporation signed an agreement for Hess to purchase 37.5 million “REDD+ jurisdictional carbon credits” for a minimum of US$750 million between 2022 and 2032 directly from the Government of Guyana. These high-quality credits make up about 30 per cent of Guyana’s Forestry Credits under the ART (Architecture for REDD+ Transactions) facility linked to TREES (REDD+ Environmental Excellence Standard).
“ART and TREES have been designed to help accelerate progress toward national scale accounting and implementation to achieve emissions reductions and removals at scale and to achieve Paris Agreement goals” ( The crux of the deal is that Guyana will be paid for its carbon sink services, a service that is critical to climate change mitigation.
Further, “this agreement will serve to support Guyana’s efforts to protect the country’s vast forests and provide capital to improve the lives of Guyana’s citizens through investments made by the Government as part of Guyana’s Low Carbon Development Strategy (LCDS) 2030.”
Editor, those who follow our economic strategy over the long term will no doubt recall that the foundations for the Guyana-Hess carbon credit deal go back to the 2009 – 2010 LCDS championed by then President Jagdeo.
At that time critics broke new ground in damning the LCDS, and this notwithstanding the Guyana-Norway deal on avoided deforestation that yielded US$250 million. Now, the LCDS 2030 under President Ali is getting the same kinds of baseless criticisms.
Only yesterday, Kaieteur News columnist Peeping Tom heaped scorn on the US $750 million deal. Here is ‘Tom’ on the historic agreement – “The carbon credit deal appears to be a far worse deal than the oil agreement. Not only has the country not been told at what price the credits will be sold, but it appears that like the agreement with Norway, Guyana will get a fixed sum over a ten-year period regardless of how high the price of carbon crises in the carbon trading markets…”
Nothing could be further from the truth. Contrary to the Kaieteur News columnist, Hess will pay a minimum price for 2016 to 2020 credits (a total of 12.5 million credits) at a unit price of US$15 per ton. It will pay a minimum price for 2021 to 2025 credits (a total of 12.5 million credits) at a unit price of US$20 per ton. For 2026 to 2030 credits (a total of 12.5 million credits) it will pay a minimum unit price of US$25 per ton. But more than that, and in diametric to the misinformation dished out by the Kaieteur News columnist if prices go above a respective floor price for that year as specified under Price Levels above, Hess will pay Guyana 60 per cent of the price difference of that year’s credits at the higher market price, and the floor price under contract. It boggles the mind that a columnist would not consult the information released by the Government but instead base their writing on rumour, gossip, or wilful disinformation.
Peeping Tom also thinks that Hess will resell the credits on the open market and that would be a big loss for us. In fact, just the opposite is true. Even if Hess does that, the floor price for carbon credits will escalate and Guyana will then be able to trade the other 70 per cent of credits starting from a much higher base price.
In terms of inclusive growth and inclusive governance, it is noteworthy that Amerindian communities will receive some 15 per cent of the revenues derived from carbon credit trading. No less than US$112 million will go to these mostly hinterland communities. It is also noteworthy that we will be receiving Legacy Credits for the period 2016-2020, that for resources that went begging under the APNU/AFC Administration.
Editor, there is a well-established clique in Guyana that is guaranteed to go against any and everything the PPP/C does. They have full access to the press, and without let or hindrance, preach negativity daily. In fact, we have seen that it took astute leadership and determined effort by President Ali, VP Jagdeo, and their team to yield the substantial resources that have now become available.
Dr Randolph Persaud