Gazprom Marketing & Trading has closed its first deal on the Latin American CO2 trading market.

In pursuing the corporate strategy for broader involvement in the global greenhouse gases trading, Gazprom Marketing & Trading, which is part of Gazprom Group, entered with Brazil’s Propower into a 6-year Agreement to buy CO2 emission permits.

Gazprom Marketing & Trading and Propower also decided to jointly invest in projects implemented in Brazil via the Kyoto Protocol’s Clean Development Mechanism fostering lower atmospheric emissions and more extra quotas.

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Established in 1999, Gazprom Marketing & Trading, a Gazprom Group British subsidiary, has all the statutory licenses for gas supply to final consumers in various industrial sectors.

In 2006 Gazprom Marketing & Trading completed its first gas and CO2 emission permit/electricity swap deal as part of the European Emissions Trading Directive.

Founded in Brazil in 2001, Propower mainly focuses on developing and introducing solutions as regards the utilization of renewables. Propower also coordinates the operation of several plants producing biomass and generating power from biowastes.

CO2 emission quotas are traded under the Kyoto Protocol ratified by Russia on October 22, 2004 and effective since February 16, 2005. The Protocol’s goal is to force all industrial countries to reduce emissions of greenhouse gases up to 5.2 per cent below their 1990 baseline over the 2008 to 2012 period.

The Kyoto Protocol highlights three mechanisms supplementing intrastate measures to reduce greenhouse gas emissions, namely: Clean Development Mechanism, Joint Implementation and International Emissions Trading.

The Clean Development Mechanism is targeted at cutting greenhouse gas emissions by incentivising companies in industrially developed countries to invest in corresponding projects in developing countries.