Rayonier has completed its merger with PotlatchDeltic, creating a timberland REIT with 4.1 million acres. The company is pivoting beyond traditional logging to monetize carbon sequestration, reporting 12 million metric tonnes of CO2 equivalents sequestered in 2024. Beyond carbon credits, Rayonier is diversifying into land based climate solutions. This includes leasing land for wind and solar projects and selling subsurface pore space rights for industrial carbon capture and storage (CCS).
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Rayonier is basically betting that their land is worth more as a carbon sink than as a lumber yard. 12 million tonnes sequestered is a big number, but I want to see the actual credit pricing they are getting for this.
The real question is which registry they are using. Voluntary markets are a mess right now. If they are relying on SFI or FSC certifications to drive a premium, they need to be clear about the additionality of these forests.
They mentioned leasing land for solar and wind. That sounds good on a slide, but the bottleneck is always the interconnection queue. Does this land actually have access to high voltage transmission or is it just remote acreage?
True, but the subsurface pore space for CCS is the more interesting play here. That is a completely different asset class than surface leasing.
Interesting to see a REIT move into CCS. I wonder what the long term liability looks like for the landowner if a leak occurs in the subsurface storage. The legal framework for that is still pretty thin.
