Eight companies win Malaysia’s first nature-based carbon credits auction

Bursa Malaysia Bhd announced on Thursday the successful bidders in Malaysia’s inaugural nature-based carbon credits auction, managed by its subsidiary Bursa Carbon Exchange (BCX). The auction featured carbon credits from the Kuamut Rainforest Conservation project in Sabah.
Among the successful bidders are national oil and gas company Petroliam Nasional Bhd (Petronas) and three publicly listed firms: Malayan Banking Bhd, Gas Malaysia Bhd, and Yinson Holdings Bhd. The other winners include CIMB Bank Bhd — the banking arm of CIMB Group Holdings Bhd, BBB Asia Capital Bhd, Eco Green Carbon Ventures Sdn Bhd, and TROX Malaysia Sdn Bhd.
Bursa Malaysia stated that the auction allows companies to mitigate their environmental impact through credible means, such as offsetting greenhouse gas (GHG) emissions. The auction set a clearing price of RM50 per contract for the domestic forest protection and regeneration project.
In addition to GHG reduction, the Malaysian nature-based carbon credits plus (MNC+) contracts offer co-benefits like environmental preservation, improved livelihoods and well-being of local communities, and biodiversity protection.
” This auction also establishes a benchmark price for voluntary carbon credits for Malaysian nature-based carbon projects,” Bursa Malaysia said in a statement. The Kuamut project has received international acclaim and is rated as one of the highest-rated improved forest management (IFM) projects globally by the carbon rating agency BeZero Carbon.
For Malaysia, the Kuamut project is significant as it demonstrates the potential for Malaysian forests to generate high-integrity carbon credits. “As a lighthouse project for local forestry-based carbon credits, it paves the way for other states to look into preserving their forests and natural resources while contributing to the nation’s commitment to maintain at least 50% of the country’s land that is under forest and tree cover, a pledge made during the Earth Summit in 1992,” Bursa added.
“It has been a long wait for Malaysia to finally witness the auction of the country’s first domestically produced quality carbon credits,” said Datuk Muhamad Umar Swift, Chief Executive Officer, Bursa Malaysia. “Organic growth of the voluntary carbon market will take time to mature,” he added, based on observation of the voluntary renewable energy certificates (RECs) market where organic growth of a nascent market took at least five years to scale.
“A critical step to accelerate the development of domestic carbon projects is to adopt some form of compliance carbon market,” stated Datuk Muhamad Umar, in support of Malaysia to implement a form of compliance carbon pricing instrument.