U.N. rejects big Kyoto project in Equatorial Guinea

A general view shows a poor neighborhood of Malabo in Equatorial Guinea October 7, 2005. An emissions-cutting project in Equatorial Guinea has become by far the biggest yet to fail a United Nations approval process under the Kyoto Protocol on global warming.

LONDON (Reuters) - An emissions-cutting project in Equatorial Guinea has become by far the biggest yet to fail a United Nations approval process under the Kyoto Protocol on global warming.

The project was meant to reduce flaring by turning natural gas into methanol. It failed to demonstrate that its proposed emissions cuts would not have happened anyway, regardless of Kyoto incentives.

This is the twenty-sixth project to be rejected so far.

The U.N.-backed Kyoto Protocol allows rich countries to meet emissions targets by funding clean energy projects in developing countries, for example to install wind power or destroy potent greenhouse gases.

Such carbon trading has attracted criticism. One analyst has alleged fraud in India, and a U.N. official has acknowledged poor quality projects may have slipped through an approval process that lacked resources early on.

Much criticism centers on whether projects are claiming carbon credits for emissions cuts that would have happened anyway.

Project developers have to get approval from a U.N. judging panel called the CDM Executive Board.

In its decision last Friday the Board said that the Equatorial Guinea project developer Atlantic Methanol Production Company (AMPCO) had failed to prove it begun work after January 2000, the starting point for Kyoto projects.

The decision pleased environmental group WWF.

"It's good, it's an example where the checks and balances of the Executive Board have worked in catching out projects which are less robust," said WWF's Keith Allott.

"But there are over 1,600 projects in the pipeline and it's difficult to scrutinize them all. This one got caught because we and others spotted it and made a fuss."

The project was meant to save some 2.3 million tonnes of greenhouse gas emissions annually, worth around 30 million euros ($41.11 million), by turning natural gas into methanol, which can be used as a substitute for high-carbon gasoline.

The private sector approver of the project proposal, Det Norske Veritas, was unavailable for comment.

To date, the UN Framework Convention on Climate Change (UNFCCC) has issued more than 63 million Certified Emissions Reductions credits (CERs), each equivalent to the reduction of one tonne of carbon dioxide (CO2), and has registered 751 different projects in almost 50 developing countries.

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