Klimat X Developments Inc. announced it has signed a binding Heads of Agreement with Imperative Global ProjectsPte Ltd. (Imperative) to jointly develop the large-scale mangrove restoration project in the State of Yucatan, Mexico secured and previously announced by Klimat X. The project site covers almost 100,000 hectares of intact and degraded mangrove, with opportunities for up to 40,000 hectares of restoration through a combination of hydrological restoration of tidal flows and large-scale replanting of native mangrove species. If fully restored, the project has the potential to generate over 10 million tonnes of carbon credits over 30 years. The project will be completed under the Verra standards.

Auction prices above $30 per tonne for mangrove projects were reported by Reuters on the Singapore based CIX Exchange. Trove Research reports that nature-based restoration projects are generating premium prices in the market, with pricing expectations above $20/ton in 2024. This joint venture brings together multi-decade experience from both companies to design and successfully develop and operate a best-in-class project.

The agreement envisages the completion of a fully binding Transaction Document by 1stJune 2024 and a cash injection by Imperative into the project vehicle. Collaborating in this way, the parties can leverage the skills, experience and knowledge of their respective market-leading teams. The Company will lead, with Imperative's support, on domestic legal, community engagement and government relations matters and on the development of the project design documentation with the technical service providers. Imperative will lead, with Klimat X's support, on raising project finance, on project management and implementation (including the development and management of the engineering solutions necessary to restore tidal flows), and on the negotiation and execution of offtake agreements.