NativState

Up to 20% gross revenue royalty on a portfolio of U.S. Improved Forest Management projects

Operator

NativState LLC

Location

Arkansas, Louisiana, Mississippi and Missouri, USA

Stage

Issuing

Commodity

ACR Emission Reduction Ton voluntary carbon offset credit

Terms

20% gross revenue royalty on ACR 783.

Additional average 10% gross revenue royalty on an incremental 60,000 acres to be enrolled in ACR projects by NativState across Southeastern U.S.

Purchase Price

US$5.6 million

NativState is an Arkansas-based forest carbon project developer focused on aggregating small-to-medium forest landowners into Improved Forest Management (“IFM”)  projects being developed under the American Carbon Registry (“ACR”). Green Star Royalties acquired several gross revenue royalties ("Royalties") on NativState's carbon credit-issuing portfolio of IFM projects in the southeastern United States. The Royalties are expected to deliver to Green Star Royalties premium voluntary carbon credits over a 20-year period, with a total consideration for the Royalties of US$5.6 million having been paid over a series of tranches.

Highlights

  • Immediate credit-issuing and cash-flowing royalty for Green Star Royalties: Project ACR 783 in Arkansas became Green Star Royalties’ first carbon credit-issuing investment with approximately 120,000 carbon credits delivered under the Royalty in 2024. Approximately 75% of Green Star Royalties’ attributable carbon credits from the Royalties are expected to be delivered in the first five years.
  • Expansion of Green Star Royalties’ North American nature-based portfolio: The Royalties on NativState's IFM projects complement and diversify Green Star Royalties’ existing portfolio of North American nature-based carbon credit solutions.
  • Aligned and defensive royalty structure: Green Star Royalties and NativState have agreed to several defensive mechanisms, including minimum carbon credit volumes to be delivered over the 20-year royalty term.
  • Multiple Royalties with strong investment metrics: The Royalties consist of a 20% Royalty on Project ACR 783 and 10% Royalties on an additional 60,000 acres across Arkansas, Louisiana, Mississippi and Missouri to be developed by NativState and registered as future ACR projects. At prevailing carbon credit prices, the Royalties are expected to provide significant net present value accretion and allow for an attractive payback period.
  • Partnership with rapidly growing carbon developer: NativState, with over 300,000 acres under management, is striving to become the largest U.S. aggregator of small-to-medium forest landowners. Green Star Royalties is proud to be building a long-term partnership with NativState by funding American forest landowners keen to participate in both IFM practices and voluntary carbon markets.

Asset Description

Below is a summary of ACR-listed NativState projects that Green Star Royalties has funded through its royalty investment:

  • PROJECT ACR 783 – THE S&J TAYLOR FOREST CARBON PROJECT, ARKANSAS
  • PROJECT ACR 912 – MIXED BROADLEAF FORESTS OF THE OZARK HIGHLANDS
  • PROJECT ACR 913 – BOTTOMLAND FORESTS OF THE MISSISSIPPI DELTA AND PIEDMONT

Click "Read more" below for more information on each project.

PROJECT ACR 783 – THE S&J TAYLOR FOREST CARBON PROJECT, ARKANSAS

Project ACR 783 is a verified and already-issuing project and represents approximately 18,000 acres of sustainably managed forestland across Southcentral Arkansas. This project is expected to generate carbon offsets over the next twenty years. Green Star Royalties owns a 20% royalty on this project, which issued and sold its first carbon offsets in March 2024 with a second carbon offset issuance expected later in 2025.

The S&J Taylor Forest Carbon Project aims to conserve Saline River bottoms riparian hardwoods and pines in Arkansas. Project ACR 783 aims to maintain forest CO2e stocks by certified and sustainable management while accomplishing significant carbon sequestration and providing important co-benefits to the Ouachita watershed, local communities, and improved water resources to downstream communities throughout the Gulf Coastal Plain Region. Large tracts of riparian bottomland hardwoods that are part of this project act as essential buffers from runoff to the river and to the habitat of the endemic freshwater Arkansas fatmucket mussels.

Learn more

https://vimeo.com/922734059.

PROJECT ACR 912 – MIXED BROADLEAF FORESTS OF THE OZARK HIGHLANDS

Project ACR 912 represents approximately 9,100 acres of sustainably managed forestland across the Arkansas Ozark Highlands. Green Star Royalties owns a 7% royalty on this project, which is expected to have its first carbon offset issuance later in 2025.

Project ACR 912 uses a programmatic development approach to IFM, that allows landowners with smaller tracts of land to combine under one project. Through sustainable forest management, the project will provide significant climate benefits through carbon sequestration from native forests. The Ozark Highlands contain diverse geology, topography, and vegetation, with regional features including spring-fed streams, caves, limestone glades and prairies. Much of the land in this area is primarily used for logging, livestock farming, woodland grazing, recreation, quarrying, and housing, with only 4% of the Ozark Highlights Mixed Forests ecoregion currently protected.

PROJECT ACR 913 – BOTTOMLAND FORESTS OF THE MISSISSIPPI DELTA AND PIEDMONT

Project ACR 913 represents approximately 7,800 acres of sustainably managed forestland across Eastern and Southcentral Arkansas. Green Star Royalties owns a 3% royalty on this project, which is expected to have its first carbon offset issuance later in 2025.

Like ACR 912, Project ACR 913 enables smaller landowners to join forces with others committed to maintaining forest CO2e stocks through sustainable management, which contributes to climate conservation efforts through carbon sequestration of native forests. This project focuses on the deciduous forested wetlands of the Mississippi Delta and Piedmont, where forests in this area serve a critical role in reducing the risk and severity of flooding to downstream communities. While bottomland forests once covered significant portions of the Southeastern United States, today, only about 40% of the region still supports these unique ecosystems, highlighting the importance of NativState’s conservation efforts in this area.

UPCOMING ACR PROJECTS

As part of the royalty agreement, NativState will continue to enroll forest landowners across the southern United States into future ACR projects that will be subject to 10% royalties, until total acreage under the Royalties reaches 60,000 acres, excluding Project ACR 783. These future IFM projects are expected to be located in Arkansas, Louisiana, Mississippi and Missouri.

About NativState

NativState LLC is a forest carbon project development company partnering with small-to-medium sized landowners across the southern United States to deliver access to global carbon markets. It works with landowners to improve and conserve their forests while realizing a financial return based on the creation of high-quality carbon credits sold to companies seeking to meet and exceed their carbon emission reduction goals. NativState empowers forest owners with the ability to manage their properties sustainably and provide the co-benefits of improved water quality, improved wildlife habitation, and improved overall health of the forest itself.