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Voluntary carbon offset buyer hits ESG goals with AEGIS
MARKETS: ENVIRONMENTAL | COMMODITY: CARBON OFFSETS | CLIENT: OIL & GAS PRODUCER

Situation

A voluntary carbon offset buyer had worked exclusively with another firm for offset purchases. This industry provider had sold the company carbon offsets several times over the past few years.
When the company received a quote for 2021 offsets priced at approximately $7.00 per ton, the company contacted
AEGIS.

The company did not have the budget for $7.00 offsets and was therefore unable to meet its ESG goals.

Solution

As AEGIS educated the client on the many variations of carbon offsets available in the market, it became apparent that the company had no requirement to purchase domestic offsets. As a result, the company’s ESG goals could be fully attainable by purchasing less expensive, international carbon offsets. Since AEGIS was able to provide the company with additional options, the company sought AEGIS' outlook on pricing for 2022. Facing a rising market with a need to purchase offsets again in 2022, the company elected to purchase 2-years at once, enabling the company to have ESG budget predictability.

Outcome

AEGIS demonstrated our commitment to fully understanding the company’s situation and providing a company with as many options as possible to achieve their specific ESG goals. By selecting an international offset, the company was able to offset 2021 & 2022 emissions for $3.00 per ton rather than the $7.00 per ton quote provided by another industry provider the company had previously used.

As a result, the company had more options, a deeper understanding of the environmental markets and a predictable ESG for the next two years. In addition, the company understood which elements of an offset came at a premium or a discount. In the end, the company saved approximately 40% in costs for 2022 by buying in advance.

 

In the end, the company saved approximately 40% in costs for 2022 by buying in advance.

 

No representation is being made that any client will or is likely to achieve hedge profits similar to those discussed in this case study. This testimonial is not indicative of future performance or success. Commodity interest trading involves risk and, therefore, is not appropriate for all persons; failure to manage commercial risk by engaging in some form of hedging also involves risk. Past performance is not necessarily indicative of future results. There is no guarantee that hedge program objectives will be achieved. Neither this trading advisor nor any of its trading principals offer a trading program to clients, nor do they propose guiding or directing a commodity interest account for any client based on any such trading program. Hedge advisory services are performed by the registered commodity trading advisor AEGIS-CTA, LLC, a wholly-owned subsidiary of AEGIS Hedging Solutions, LLC. This case study is not required to be and has not been, filed with the Commodity Futures Trading Commission ("CFTC"). The CFTC does not pass upon the adequacy or accuracy of this commodity trading advisor disclosure. Consequently, the CFTC has not reviewed or approved this case study.

 

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