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. Last Updated: 07/27/2016

Gazprom Seals New Emissions Deal

LONDON -- Gazprom agreed on its first emissions trade outside Europe, part of an effort to attract new energy customers in Britain, France and Germany.

Gazprom Marketing & Trading agreed to buy an unspecified number of emission credits over the next six years from Propower do Brasil, which has a power plant that burns wood products rather than fossil fuel, said Vitaly Vasiliyev, the CEO of the trading unit. Gazprom did not say how much the credits cost.

Credits from developing countries like China and India, along with those gained by curbing emissions in Russia, will be sold in packages with power and natural gas, Gazprom said. Laws curbing the emission of greenhouse gases blamed for global warming helped the world emissions market more than double last year, to $30 billion.

"Gazprom will position itself not only as a gas company, but as a multi-commodity company, which provides gas and carbon emissions," Vasiliyev said Monday in an interview in London before the proposed signing Tuesday in Sao Paulo of the Brazil agreement. "It's the future for marketing activities."

The Gazprom unit will help finance emission-reducing projects to secure the credits from Propower, which are to be created under the clean development mechanism of the 1997 Kyoto Protocol. The mechanism, managed by a department of the United Nations, gives industrialized nations credits for investing in projects in poor countries that cut or eliminate emissions.

The Brazil trade provides a "framework" for Gazprom to gain more credits by curbing greenhouse gases at home under the joint implementation mechanism of the Kyoto treaty, Vasiliyev said, declining to say how many of the so-called JI credits Gazprom would create. "Russia has a very big potential" for the credits.

"What we're trying to do is build our capabilities for JI projects."