NEW FORESTS COMPANY: Forestry-based climate change solutions

A presentation by Phoebe Sullivan, Carbon Manager

UGANDA

TANZANIARWANDA

MOZAMBIQUE

PROJECTSOURIN AFRICA

COMPANY OVERVIEW

NFC is building one of Africa’s premier, sustainable forest and wood product companies, diversified

across geographies, markets and products, and underpinned by a strong corporate responsibility

strategy.

LOCATION

Operating in 3 African countries: Tanzania,

Uganda and Mozambique. Projected to expand

into Rwanda and Kenya by 2011. Operational

since 2005.

THE BUSINESS

Growing sustainable timber resources and

delivering high quality, value-added wood

products into the East African market.

ASSETS

By the end of 2010 the company expects to have

a total forest estate of approximately 24,500

hectares and a workforce of more than 3,000.

Over 6,000 Ha under FSC certification and

expanding.

TEAM Distinguished management team with proven

African experience.

CARBON

Carbon key to company’s financial strategy, with

a project in its advanced stages in Uganda, and

looking to expand across the entire plantation

portfolio as new assets are acquired.

TANZANIA: PROFILE

NFC is developing a world-class, forestry carbon program in rural Tanzania, with minimum

land-holdings of 10,000 hectares and projected holdings of 24,000

PLANTATION Lukosi – Kilolo District, Iringa.

TOTAL HECTARES 7,000 hectares secured, negotiating a minimum of

7,000 more – granted right of occupancy.

LAND TYPE Greenfield

TIMELINE Planting 1500 hectares per annum, with initial

planting initiated in December 2009

SPECIES PLANTED 66% Pine, 33% Eucalyptus

CERTIFICATION Either Forest Stewardship Council or Climate,

Community and Biodiversity Alliance Standard

LAND ATTRIBUTES Degraded grasslands. Wetland and forest patches to

be maintained for conservation purposes

CARBON CREDIT

OUTPUT

Preliminary and conservative calculations

demonstrate a minimum of 1.8 million tons of

CO2 emissions reductions (10,000 hectares of

land)

MARKET

ORIENTATION

Adoption of a CDM approved-methodology,

but entrance into the voluntary market under

VCS

EXPERTISE NFC uses advanced techniques for measuring

tree growth – ensuring accuracy of carbon

calculations. Data is managed in the state of

the art MicroForests system, with attention to

cross-checking data and running regular

plantation audits to monitor accuracy.

TANZANIA: CARBON OVERVIEW

NFC’s forestry expertise ensures delivery of quality carbon credits, in a geographic region where

large-scale, land-based projects are a rarity

TANZANIA: CARBON OVERVIEW

NFC’s project management expertise will allow for timely delivery of forestry credits to the

voluntary market.

PROGRESS TO-DATE •EIA performed

•Baseline community assessment finalized and Participatory Rural Appraisals

underway

•Preliminary land eligibility analysis (SPOT image analysis) completed

•Important learning from previous carbon development in Uganda

MARCH APRIL JULY SEPTEMBER

2011 Project Cycle Timeline

UNDERSTANDING LOCAL CONDITIONS NFC employs a local Community Development Officer for each plantation, and runs participatory

rural appraisals to gather local input and knowledge for responsible project design

CSR PERSPECTIVE Direct development interventions supports the company’s superior form of long-term risk

management - NFC builds relationships, not fences.

UGANDA In Uganda, NFC has built schools in communities surrounding plantation, is engaged in an

outgrowers scheme to encourage responsible natural resource management, actively employs

locals, recently launched health clinics for local employees and neighbours and supports the

generation of new livelihood opportunities.

TANZANIA Completed the baseline community assessment and running PRAs – tailored programs will be

rolled out in 2011 , adapted to local needs.

CORPORATE GOVERNANCE APPROACH

NFC is committed to generating VERs with verifiable social and environmental co-benefits –

ensuring delivery of charismatic credits.

WHO WE ARE

87% ownership

100% ownership

Similar hierarchy for

Mozambique and

Ugandan operations

CEO

J Ozanne

Head of HR

E Viviers

Head of CSR

K Sharum

Head of Planning

L Cunningham

Head of Forests

A Greeff

CFO

Q Scorgie

CO Secretary

O Burton

Group

Financial

Controller

D Sharma

Country

Finance

Teams

GM Ug

T Kachale

GM Tz

J Lawrie

GM Moz

J Potgieter

Ug CSR

A Kyabawampi

Tz CDO

Moz CDO

Planning

Forester

W Jacobs

Commercial

Manager

G Garz

Group

Financial

Accountant

S Touffie

Carbon

Manager

P Sullivan

Highly experienced leadership team with complementary skills and expertise

WHO WE ARE

9

WHO WE ARE

JON AISBITT

former Partner and Managing Director

of Goldman Sachs Investment Banking

Division

ROBERT DEVEREUX

founding shareholder of The Virgin

Group and former Chairman of Virgin

Entertainment

INSTITUTIONS PROFESSIONAL INVESTORS

PETER WHEELER

Head of Wholesale Banking for the West

for Standard Chartered PLC

STANLEY FINK

former Chief Executive of Man Group

PLC

A strong Board of Directors with a proven track record in major organisations

Shareholder in NFC-Uganda

Debt investment in Uganda

Equity and long-term debt

investment in Uganda

Shareholder in NFCH

10

MONITORING AND REPORTING

DELIVERY

QUALITY

COST

INTEGRATED

MANAGEMENT SYSTEM

(IMS)

Operational risk mitigated through institutionalised management systems

NFC QUALITY-

BEST PRACTICE

MICROFOREST

An integrated management system - managing risk on a daily basis

FINANCIALS

Timber assets represent a long-term investment – carbon revenues can rationalize the sizeable upfront

capital required to establish a large-scale plantation.

CARBON ASSET OPPORTUNITIES

Abundant opportunity to access NFC’s carbon assets, throughout various stages of the project cycle.

NFC seeking early support to facilitate the research and project design phases.

PROJECT DESIGN PHASE

Looking to reward risk-takers

POST-VERIFICATION