AXA IM Alts, an alternative investments company, has announced a $49 million commitment to invest in Mombak reforestation projects. Mombak is a native species carbon removal start-up.
The company invested in the Mombak reforestation projects under the natural capital and impact investing strategy. This investment will support the restoration of the Amazon rainforest on pastures in Brazil.
The company has also taken a minority equity stake in Mombak. This equity allows for the scaling up of operational and technological systems.
The need for reforestation
The Brazilian Amazon rainforest is battling mass deforestation of a minimum of 1 million hectares per year.
The causes of deforestation are increasing cattle farming and manufacturing of agricultural goods. The loss of habitat and food sources for the animals that reside there disrupts their ecosystem.
As carbon emissions are causing climate change, deforestation will only make it hard to remove emissions.
AXA IM Alts is teaming with Mombak on projects to reforest over 10,000 hectares of degraded pastureland.
A combination of native species plantations and assisted natural regeneration (ANR) are the means to achieve this. The project objective is to generate up to 6 million high-quality carbon credits.
AXA IM Alts natural capital and impact investing strategy
The company finances activities to ensure the protection of vulnerable and high-value natural habitats from deforestation. Also, restoration of natural ecosystems are part of this strategy.
The strategy involves –
- Direct investment into ecosystem protection and restoration.
- Investments to address drivers of deforestation and degradation.
- A quantified means through the issuance of carbon credits.
Adam Gibbon, Natural Capital Lead at AXA IM Alts, comments,
“We are delighted to be supporting Mombak’s ambition to reforest the Brazilian Amazon rainforest at scale through an equity stake and project financing partnership.”
“Globally, reforestation has the potential to capture 2-3 bn tonnes CO2 per annum and with Mombak we want to be at the forefront of making that possibility a reality. The forests Mombak restore will be 100% native species, providing habitat to countless species, restoring local hydrological cycles and providing more jobs per hectare than the cattle pasture they replace.”
“This investment is fully aligned with our broader commitment to contribute to mitigate climate change and avert the biodiversity crisis.”
The portfolio combines strategic equity investments into project developers and companies supporting the natural capital market ecosystem with direct project financing.
