Negotiations with Norway on the continuation of a forest agreement with this country are in advanced stages, President Irfaan Ali has revealed.
Ali told a news conference last Wednesday that he was unsure when an agreement will be made.
Meanwhile, he said that the funds that remained from the last pact are being programmed towards renewable energy.
Under that agreement, which was signed in 2010, Guyana pledged to accelerate its efforts to limit forest-based greenhouse gas emissions and protect its rainforest as an asset for the world. As such, Norway provided financial support at a level based on this country’s success in limiting emissions with a price set at US$5 per tonne of CO2 equivalent.
Back in 2017, when Norway had US$80M in payments to disburse under the agreement, the release of the funds had hit a snag as this country had presented the inclusion of natural gas as part of Guyana’s ‘Green State Plan’.
Special Envoy and Director of the Norwegian International Climate and Forest Initiative, Per Fredrik Pharo has made clear that the release of the US$80 million, originally meant to be Guyana’s equity contribution for the huge Amaila hydropower project, was hinged on Georgetown showing a clear plan towards clean, renewable energy.
“This is not about any particular project, but about a realistic and politically anchored plan to deliver on the government’s own stated ambition,” Pharo had written in April 2017, in an Op-Ed published in the state-owned Guyana Chronicle newspaper, where he assured that Norway is committed to supporting Guyana’s transition to clean and renewable energy sources.
It would take two years before Guyana demonstrated that it had met its commitments and in December of 2019, government announced that the money had been released.
However, Norway later said that the then government could not access the funds due to its then caretaker status and disbursements could not be sanctioned until after the March 2nd general elections.
It has been unclear if there would be a renewal of that forest pact, given that Guyana is now an oil producing nation, coupled with the fact that it has flared over 9 billion cubic feet of natural gas since oil production began in December 2019.
Based on the carbon price under Guyana’s forest protection pact with Norway, the nine billion cubic feet of natural gas equivalent would be equal to the loss of 4,642 hectares of forest, which would be valued at US$24 million.
