The government of Papua province in Indonesia has entered into an agreement with an Australian financial firm to establish a forestry-based carbon finance project.
The project - which could involve more than one million hectares - aims to create "a perpetual financial base for local communities" through carbon credits, generated by forest conservation.
The Mongabay website quotes David Brand, the Managing Director of New Forests, a Sydney investment firm, says there's a high level of interest in establishing pilot projects for forest conservation based on carbon finance.
He says the project aims to deliver high-quality carbon credits to the voluntary market based on the government's decision to rescind the logging and agribusiness development status of the land.
The new agreement is based on Reduced Emissions from Deforestation and Degradation, a proposed policy mechanism that would compensate tropical countries for safeguarding their forests.
Papua Governor Barnabas Suebu imposed a province-wide moratorium on logging last December, in the hope that the emerging carbon market would offer better returns.