Product Overview
Durum Carbon LP (“Durum Carbon”) was created to provide investors with unique exposure to the rapidly growing asset class of carbon credits. Canada’s transition to a low-carbon economy and tightening environmental regulations have led to the creation of a unique market opportunity for the purchase and sale of carbon credits in Canada. Durum Carbon LP ultimately seeks to participate in this market through the strategic acquisition and management of a carbon credit portfolio.
Investment Thesis
Through active management, Durum Carbon is an investment vehicle that is able to participate in a broader range of carbon markets compared to other direct carbon credit investment options such as the exchange-traded funds currently available in the market. Durum Carbon’s main investment approach is simple:
1. To purchase carbon credits in the Alberta compliance market under a buy-and-hold strategy;
2. Actively monitor the regulatory environment and rebalance the portfolio as regulations evolve;
3. Ultimately profit from Canada’s proposed carbon price escalation and tightening environmental regulations in the federal and provincial market.
Durum Carbon is a 4-year closed-end limited partnership, a timeline that provides investors with exposure to the anticipated carbon price escalation up until 2026, where the carbon price is expected to increase from $50 today to $110, an annual increase of 22%. Carbon credits will be purchased from environmental project developers and high-performing industrial facilities and then eventually sold to industrial facilities with higher relative carbon intensities, commodity brokers & marketers, and other market participants.
