The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Rosewood Exuma developer agreed to slash its dredging “footprint” by 75 percent after a unit within the Prime Minister’s Office voiced concern it could cost The Bahamas up to $25m in lost ‘blue carbon credits’ revenues.

Documents filed with the Supreme Court as part of the Judicial Review challenge to the project’s environmental approvals disclose that the developer, Miami-based Yntegra Group, also pledged to purchase Bahamian carbon credits once issued after the Government’s Climate Change and Environmental Advisory Unit voiced concern that the dredging would destroy key seagrass meadows.

The Davis administration’s long-stated policy has been to monetise seagrass beds, and other natural assets that extract carbon dioxide from the Earth’s atmosphere, into sustainable revenue streams for The Bahamas. But the Climate Change Unit, in an October 15, 2024, memorandum argued that Yntegra Group’s dredging plans for Sampson Cay’s North Bay were directly contrary to the Government’s environmental posture and plans to leverage such carbon ‘sinks’ into income-generating securities.

Warning that the development’s likely environmental impact was “not in keeping with the requirements which will allow the Government to enter the carbon market unchallenged”, the Climate Change Unit added that the potential loss of seagrass meadows covering four acres was also “not in balance with the present ecosystem contributions”.

It estimated that the financial loss of the Sampson Cay seagrass beds was equal to $500,000 per year, or $25m over the ‘blue carbon credits’ project’s 50-year lifespan, and suggested that the Ministry of the Environment and Natural Resources implement “a replanting policy” requiring that three new trees be planted for each one removed. This, the Climate Change Unit added, would likely require Yntegra Group to pay $11.2m in permit fees.

The internal government concerns over the $200m Rosewood Exuma project appeared to spark swift action both from Yntegra Group and within the Davis administration. Another memorandum, written by the Prime Minister’s Office on November 8, 2024, just three weeks after the first communication, signalled that the Climate Change Unit had been reassured by promises to reduce the dredged area from four to just 0.76 acres plus Yntegra Group’s pledge to buy ‘blue carbon credits’ equal to that space.

Dr Rhianna Neilly-Murphy, head of the Department of Environmental Planning and Protection (DEPP), then addressed the matter in both a November 12, 2024, memorandum to Rochelle Newbold, the Climate Change Unit’s head, and an e-mail sent the same day to Jerome Fitzgerald, the Prime Minister’s senior policy advisor. While affirming that the developer had been told to “propose an alternate location” for its service dock, she added that factors influencing approval “extend beyond the presence of seagrass”.

Yntegra Group did not respond to Tribune Business’s request for comment before press time last night. However, well-placed sources questioned the dollar values detailed in the Climate Change Unit’s original October 15, 2024, memorandum which was signed on behalf of Creswell Strurrup, permanent secretary in the Prime Minister’s Office.

They argued that, based on those figures, The Bahamas’ seagrass meadows and other carbon ‘sinks’, which extract this gas from the Earth’s atmosphere and convert it back into oxygen, would be collectively worth trillions of dollars - rather than the $50bn value this nation has assigned over a 50-year period.

Based on the 23m acres, or 93,000 square kilometres of seagrass beds mapped to-date, they argued that this translates to a value of $2,174 per acre. Multiplying the latter by the initial four acres that were in danger of being impacted by North Bay dredging, they added, works out to an $8,696 valuation over 50 years - not $25m.

Still, the Climate Change Unit in the original October 15, 2024, memorandum revealed that these same four acres had been included in the seagrass bed mapping that had taken place to-date. The Bahamas’ carbon sinks first have to be identified, mapped and verified before any ‘blue carbon credits’ can be issued against the environmental value they provide.

The Davis administration has assigned this task to Carbon Management Ltd, the entity formed to manage the monetisation of The Bahamas’ blue economy assets, and in which the Government holds a 49 percent ownership interest.

“The Government, being desirous to realise the revenue potential presented by the opportunity to monetise ‘blue carbon credits’ from the seagrass meadows, has entered into an agreement with Carbon Management Ltd regarding mapping and monetisation of seagrasses with the requirement of a protection status to be established for all such mapped assets,” the Prime Minister’s Office wrote in the memorandum on behalf of the Climate Change Unit.

The document, which was addressed to both Dr Neely-Murphy and David Davis, permanent secretary in the Ministry of the Environment and Natural Resources, although it named him as permanent secretary in the Ministry of Agriculture and Marine Resources, then laid out the concerns over Yntegra Group’s proposed Sampson Cay development which faces opposition from nearby resorts and others in Exuma over its scale and likely environmental impact.

Referring to Sampson Cay’s seagrass meadows, the Prime Minister’s Office wrote: “The area has been mapped as part of the National Blue Carbon assets registry. Carbon Management Ltd has expended millions of dollars to document and assess the carbon sequestration capabilities for inclusion in the carbon credit offering.

“It is known that the proposed development will impact more than four acres of untouched seagrass meadows. The marine assessment does not indicate that the marine environment is showing any signs of climate-related stress or stony coral tissue loss disease (SCTLD). This… confirms the high biological and economical value of the grasses.

“Based on the Environmental Impact Assessment (EIA), it is understood that the project proposes to dredge significant portions of the cay, resulting in complete loss of the wetlands and destruction of seagrass beds and a sandy beach. This is extremely concerning as the wetland ecosystem, which includes the seagrasses, mangroves and offshore reefs are a connected system of benefits and balance.”

Dredging has been an emotive issue over the Rosewood Exuma project, with cries of “no dredging” voiced following the latest Town Hall meeting and consultation on the development. But Felipe MacLean, Yntegra Group’s principal, recently told Tribune Business that the developer has made reductions in dredging areas, dock size and seawall construction in a bid to address concerns.

He added that the 1.26 acres his project plans to dredge to accommodate a service dock is far smaller than what neighbouring properties and other projects in the Exuma Cays have dredged.

“Our neighbour, Over Yonder, has dredged five acres. They are right across from us, and nobody said anything about it. We are dredging only 1.26 acres,” said Mr MacLean.“Other projects in the Exuma Cays like Norman’s Cay at 14.7 acres, Highborne Cay at 5.6 acres, and Bell Island at 4.7 acres, have dredged far more, almost four times’ what we’re doing. So it is astonishing that they are now complaining about a project that is dredging a minimal amount of only 1.26 acres.“

However, the Prime Minister’s Office in the October 15, 2024, memorandum argued that Yntegra Group’s then-plan was at odds with the Government’s environmental and ‘blue carbon credit’ ambitions even though the latter’s proposed 2025 issuance and launch did not occur as planned. And it added that replacing any seagrass lost to dredging would not realise the same carbon sequestration potential or economic value.

“As indicated earlier, millions have already been expended to map and assess the areas of seagrass in Exuma including around Sampson Cay,” the memorandum added. “The calculated cost for the loss of the Sampson Cay proposed seagrass is $500,000 per year for the 50-year lifespan of the project. This amounts to $25m of carbon credit revenue lost. This is the value ‘as is’ without any mitigative uncertainty.

“Further, as The Bahamas’ environmental programme is based on ensuring a resilient and functional environment which is free from unsustainable impacts. It is not recommended that consideration be given to the ‘replanting’ of seagrasses as a mitigative action for those removed or lost due to proposed developments. Such a policy will eliminate The Bahamas from the carbon markets as such action would be in keeping with ‘green washing’.”

Noting that the Government could implement a policy requiring three new trees to be planted for every one lost to development, along with regulations mandating that any damaged habitat be restored, the Prime Minister’s Office even suggested that the Rosewood Exuma project be relocated.

It wrote: “It is further noted that other mitigation costs associated with the Sampson Cay development, such as the proposed replanting of lost trees at a scale of three:one would result in $11.2m just for the permit fees required by law…

“The Ministry [of the Environment and Natural Resources] should consider the full scale of this development and its potential impacts on the present resources and future economic programme of the country. It seems apparent that the proposed development is not in balance with the present ecosystem contributions. The high mitigative cost alone suggests an incongrous placement of the large-scale development on the cay.

“Options for the development should be considered in other locations for which such identified impacts could be realistically and sustainably mitigated, and where assets such as seagrasses and the like will remain unimpacted.”

This appears to have sparked swift action. The Prime Minister’s Office, in a November 8, 2024, memo sent on Mr Sturrup’s behalf to Mr Davis and Dr Neely-Murphy suggested corrective action has been taken.

“We have been provided with the attached information regarding the footprint of the dredged channel,” the Prime Minister’s Office said. “The information provided indicates that the developer has agreed to reduce the impacts to the sea grasses with a reduction from four hectares to that of 0.716 hectares.

“With this reduction the initial referenced impacts to the lost seagrass are notably reduced and further consultation with Carbon Management Ltd has resulted in the developer agreeing to the purchase of carbon credits associated with the impacted space.

“As these two items address the major concerns identified in our original memorandum, we are mindful that mitigation has been implemented to address our earlier concerns.” And, in a follow-up correspondence written four days later on November 12, 2024, Dr Neely-Murphy wrote that public consultation over the Yntegra Group project was continuing.

“As a result of information received into the Department concerning the proposed location of the roll-on, roll-off dock, the developers were instructed to propose an alternate location for this facility,” she said. “The deciding factors extend beyond the presence of the sea grass. Any decisions concerning this project and any other under review by the Department will continue to be made based on the best available science and site specific information.”