January 17, 2011 / 3:05 PM / in 7 years

UPDATE 1-Natsource cuts staff on climate pact delay

* Natsource cut staff in 2010 on uncertain climate policy

* Natsource Japan decides to close business

By Nina Chestney and Risa Maeda

LONDON/TOKYO, Jan 17 (Reuters) - Carbon asset manager Natsource reduced its global headcount in 2010 due to uncertain international climate policy and the lack of U.S. climate change legislation, a company spokesman said on Monday.

“I can confirm that the company reduced its headcount in 2010,” Natsource spokesman Richard Rosenzweig told Reuters, declining to comment on specific numbers.

“The uncertainty in international climate change policy and the failure to enact a program in the U.S. made it very difficult to develop new business opportunities in the carbon market,” he added.

Natsource Japan Co, a Tokyo-based carbon broking venture since 2001 which is partly owned by Natsource, plans to close due to the lack of fee-generating opportunities in Japan, company sources told Reuters earlier.

Under the U.N.’s Clean Development Mechanism, firms such as Natsource invest in clean energy projects in developing countries and receive carbon credits, which can be used towards emission reduction goals or sold for profit.

A U.N. meeting in Cancun, Mexico, last month failed to agree on a binding global climate pact to succeed the Kyoto Protocol after 2012, creating uncertainty for investors in carbon markets and cleaner forms of energy.

A U.S. federal climate bill also failed to pass last year, disappointing many investors betting on a potentially huge carbon market there.

FEWER OPPORTUNITIES

Dirk Forrister, managing director of advisory and research services, left Natsource late last year, Rosenzweig said.

“His emphasis was on developing new opportunities in the carbon market in the U.S. There will not be many for quite some time. Because of this, the company and he agreed that it made sense for him to pursue new opportunities,” he added.

There are no plans to wind down operations at the company’s London office, Rosenzweig said.

A source close to the New York-based company said several staff in London and in the United States left in 2009 and 2010.

In London, around five people on the project origination team remain and mainly manage deliveries from projects already under contract, the source said.

“Natsource is not really present in the market,” an emissions trader added.

Natsource Japan directors decided to close its business ahead of a government move to shelve its emissions trading scheme, sources said, declining to comment on when the business would be shut down.

Japan postponed plans for a national emissions trading scheme late last year, bowing to business groups that warned of job losses as they compete against overseas rivals facing fewer emission regulations. [ID:nTOE6BR023]

“As a broker, we’ve concluded that it would be difficult to fetch higher profits in coming years,” one of the sources said.

Natsource Japan is a joint venture led by Natsource, Japanese trading house Mitsubishi Corp (8058.T) and money and currency brokerage Totan Holdings Co,

Natsource Japan and Totan Holdings were not available for comment. A Mitsubishi Corp. spokesman declined to comment.

Reporting by Nina Chestney in London and Risa Maeda in Tokyo; Editing by XXX

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