Clean Development Mechanism: Initial Success of PVFC

 

Carbon credit market is a newly established goods market under the rules Kyoto protocol. Having recognized potential of the oil and gas sector in this market through large-scale industrial projects, PetroVietnam has assigned PVFC to support investors in the oil and gas sector to survey, develop and commercialize the CDM projects. In the past two years, the team of CDM development consultancy and management and Certified Emission Reductions (CERs) commercialization has been established and made specific contributions to the oil and gas sector by considerable source of revenue.

 

PVFC is in the process of expanding its business to CDM by participating into many industrial projects of PetroVietnam from waste water treatment, usage of biogas in Ethanol production plants (under construction belonging to the bio-fuel production program) to key projects of collecting and using gas at Rong Doi Moi mine, and other cooperation programs with professional partners to do survey, access potential of CDM for many projects in the investment list of the sector.

 

On May 10, 2010, PVFC successfully organized an auction that the first contract of transferring a part of CERs issued to CDM Rang Dong was signed between PetroVietnam and CERs buyer in accordance with the rules of Kyoto protocol. This brought the first source of revenue of nearly 5 million EUR to investor of CDM project in Vietnam.

 

This is a clear proof that PVFC has really grown-up and much better improved its service quality of organizing business activities in Carbon credit market. PVFC has met the standards of international practice. The process of CERs commercialization for Rang Dong project has represented a close guidance of leaders of PetroVietnam and a flexible cooperation of its subsidiaries.

 

The achieved benefits from CDM projects are not only specific benefits of project investors & PVFC but also common benefits contributing to reduction of greenhouse gas emission, reducing climate change affect and sustaining stable development. The outlook of corporate social responsibility (CSR) is committed to carry out by highest leaders of the corporation, its subsidiaries and also its employees, specialists in charge of CDM project development.

 

The process of construction and operation of a CDM project has been adjusted, assessed and supervised by stringent international rules. Hence, besides additional source of revenue from selling CERs, investors of CDM projects need a plan to cope with difficulties and risks possibly incurring from the period of feasibility study, documents of project designing to the process of operation, supervision and CERs commercialization.

 

On the other hand, development of CDM requires managers to study the ideas from early period when working out an investment plan and then, cooperating with partners to develop the project. Acknowledged of these requirements and acquiring experience from CDM Rang Dong Project, PVFC has been affirming that the participation of a financial equity in the development circle of CDM projects is an important factor supporting participants into CDM projects to achieve the proposed targets.

 

In reality, to call for investment capital and to get it approved, a high economic effective plan is usually given top priority. This will cause difficulty for investors of CDM projects when they have to prove supplementary financial report. With suitable financial and consulting services, PVFC is a prestigious and useful partner for investors of CDM projects, from offering supplementary analysis of finance, technology to providing CDM financial consultancy, investing, investment trust and arranging capital for CDM projects to guarantee a consistency of project goal, committing to reduce greenhouse gas emissions attached closely with creating resource of revenue from CERs to support implementation of projects.

 

Professionally, enhancement of successful possibility and operation of the project in accordance to designing to make income from CERs as initially planned requires investors to be able to assess the entire potential of the projects based on CDM criteria, developing and supervising projects in compliance with CDM requirements. This requires a participation of professional consultants and the third parties. With a philosophy of attaching its benefits to the end success of the projects, PFVC will help investors overcome challenges in the process of CDM project development.

 

In terms of commerce, CERs is also valuable and purchasable kind of goods operated under rules of market, but the carbon credit market itself is still a new concept for project investors in Vietnam, it has particular rules and practices, so investors should work out analysis plan of market, price as well as choosing good buyers of CERs to secure effectiveness and long term cooperation in the whole process of carbon credit circle of the project. PVFC, with a popular partnership relation with carbon credit investors and industrial groups committing to reduce emissions, has become a prestigious consultant for investors in defining commercial solutions which is suitable for enhancing effectiveness and benefits gained from CDM Projects.