NSIA, Vitol seal $50m joint venture on carbon reduction
By Business A.M.
The Nigeria Sovereign Investment Authority (NSIA), managers of Nigeria’s Sovereign Wealth Fund, and Vitol have finalised a joint venture agreement to invest in a range of carbon avoidance and removals projects as well as in the process of completing a final investment decision on the first projects.
According to a statement, an initial $50m has been committed to Carbon Vista,the joint venture with a view to attracting new investors as the partners developed the project pipeline.
The joint venture will commence with projects in Nigeria, partnering with local firms with proven track records of successfully delivering high-quality projects, combining carbon offsetting with social outcomes that contribute to the attainment of UN Sustainable Development Goals (SDGs). Its investments are also expected to focus on various sectors, including infrastructure, agriculture, and energy.
Commenting on the deal, Aminu Umar-Sadiq, managing director/CEO of NSIA, said that given the NSIA’s mandate as the custodian of economic resources for the next generation of Nigerians, tackling climate risks that have adverse effects on the environment is core to the implicit objectives of the Authority.
Umar-Sadiq said the NSIA’s sustainability objectives were beyond seeking out profitable investments that incorporated climate solutions, but more pressingly to mitigate activities that could have adverse impact on the well-being of the next generation.
To achieve this objective, the NSIA chief executive said the Authority had implemented a three-fold sustainability strategy that firstly addressed sustainability at an institutional level.
“Secondly, NSIA embeds ESG practices in its investment process while advancing climate solutions that help to lower Nigeria’s carbon footprint, and lastly builds partnerships with other institutions to support Nigeria’s overall goal of achieving net-zero emissions by 2060,” he added.
According to Umar-Sadiq,the strategy was also expected to embed ESG practices in its investment process, while advancing climate solutions that helped to lower Nigeria’s carbon footprint.
He further noted that building partnerships with other institutions to support Nigeria’s overall goal of achieving net-zero emissions by 2060 was also a major objective of this initiative.
Umar-Sadiq also stressed that the NSIA acknowledges the significant resources required to undertake green projects that deliver appreciable social impact and have partnered with Vitol to set up CarbonVista as a platform for developing quality projects and attracting third-party capital.
“Over the next few months, NSIA will roll out projects to set the standard for ESG investment in Nigeria. He said that these projects will be carefully selected, partnering with local institutions with proven track records of successfully delivering high-quality projects,” he said.
“The unique challenges posed by climate change call for deliberate and strategic action at all levels. At the NSIA, we developed a 3-prong strategy for delivering our ESG and climate finance objectives,” he said.
“Our partnership with NSIA, in support of Nigeria’s efforts to cut GHG emissions, aligns with Vitol’s commitment to sub-Saharan Africa. The projects delivered through the JV will focus on ensuring social benefits alongside the highest carbon offsetting standards,” said Michael Curran, head of environmental products at Vitol.
Zainab Ahmed, minister of finance, budget and national planning, said the NSIA’s unwavering commitment to promoting sustainable development in Nigeria is evident through its extensive portfolio of successful projects.
According to the minister, CarbonVista represents yet another milestone in NSIA’s mission to build critical infrastructure and create investment opportunities that drive economic growth and development in Nigeria.
“I am particularly pleased that this initiative is a Joint Venture between two important players in their respective fields, targeting one common goal: to invest an initial $50 million towards developing sustainability-driven projects in Nigeria,” she said.
On his part,Michael Curran,Vitol’s head of environmental products, said the partnership with NSIA in support of Nigeria’s efforts to cut GHG emissions aligns with Vitol’s commitment to Sub-Saharan Africa.