Carbon projects on pastoral land – how it works

There is much debate surrounding carbon projects “locking up” pastoral land, when in reality they can provide an additional income stream which can be reinvested into improving rural properties and providing a range of benefits for rural communities. Learn more below.

Myth busting – how does carbon and agriculture work together

Carbon projects represent a transformational opportunity for Australian agriculture. The narrative that farmers must sacrifice productivity to participate in carbon markets is both outdated and misleading. In reality, producers can generate carbon income while maintaining productive agricultural operations, creating a new revenue stream and strengthening the long-term viability of their businesses.

“The idea that farmers must choose between productive agriculture and carbon projects is outdated and, frankly, sells out producers short. The truth is we can do both, and we must do both – and Australian farmers are the ones who benefit the most.”

– Ben Sawley, CEO, Pastoral Partners Australia.

At its simplest, a carbon project is about managing your land in a way that creates a new source of income through carbon credits, typically ACCUs, on a suitable part of your property. For landholders like Pastoral Partners Australia, the process starts with understanding the property, looking at factors such as vegetation, land condition, carrying capacity and long-term potential. From there, areas with native forest regrowth potential are selected for carbon projects within the grazing enterprise.


As the native vegetation regenerates, it draws carbon dioxide from the atmosphere and stores it in trees and woody vegetation. This stored carbon is measured and verified, with each tonne converted into an Australian Carbon Credit Unit (ACCU). Those ACCUs can then be sold into the carbon market.


The income generated from carbon credits creates an additional long-term and reliable revenue stream that can be reinvested back into the property. Rather than replacing agriculture, this capital can help fund infrastructure, fencing, water developments, improved grazing management and other productivity improvements that might otherwise never be able to happen.


In this way, carbon projects become more than just an environmental initiative. They provide producers with another source of income that can help increase carrying capacity, improve land condition and build greater resilience against seasonal and market challenges. The result is a stronger, more productive agricultural business that benefits from both livestock and carbon revenues. Learn more.

How carbon funds production improvements


Meet one of our Farm Managers, Dave McBurnie. In conversation with our CEO Ben, Dave discusses the major infrastructure works his team has managed across our Wongalee property to increase production and also create a more drought resilient operation. These upgrades would not have been possible if it weren’t for the carbon income the projects generate to support the land.

In agriculture, success depends on balancing many interconnected factors – pasture, livestock, infrastructure, people, seasonal conditions, cash flow and risk. Carbon is simply another part of that equation. The goal isn’t to prioritise one outcome over another, but to improve the performance of the whole enterprise.

At Pastoral Partners Australia, we focus on three outcomes that work hand in hand: healthy landscapes, productive livestock operations and strong financial returns. When managed well, each supports and strengthens the others.


Carbon revenue can play an important role in achieving that balance. It can help fund infrastructure and improvements that deliver lasting benefits across the property. Additional fencing can support more effective grazing management, extra water points can improve pasture utilisation, upgraded yards can enhance livestock handling efficiency and safety, and improved technology can provide the data needed to make better-informed management decisions.


Recently, our Chief Operating Officer, Geoff Murrell, published an article explaining our agistment model in more detail to showcase how our grazing enterprise and carbon projects work together to create better outcomes for the land.

You can read the full article here.

Frequently asked questions

At Pastoral Partners Australia, we think there is an immense opportunity for other landholders to do what we do. By doing so people can improve their financial positions, improve the productive capacity of their properties and also improve the broader environment. To help people who are thinking about a carbon project, we’ve laid out some answers to the typical questions we get:

A carbon project either reduces greenhouse gas emissions and/or draws carbon dioxide out of the atmosphere. It is an action that would not have been undertaken in the ordinary course of “business as usual” and is only being done as a result of a carbon project (e.g. enable the regrowth of some native forest on cleared grazing land). The project must be undertaken on eligible land under an approved carbon methodology. The project proponent manages the land in accordance with the methodology’s requirements and reporting obligations. If the project successfully generates verified emissions reductions or carbon sequestration, carbon credits may be issued and can be sold in carbon markets.

Yes, native forest regeneration carbon projects can coexist with grazing operations. Grazing practices may need to be modified in project areas to meet methodology requirements (e.g. ensuring the animals are not impacting tree regrowth). These requirements depend on project type and methodology.

The impact on agricultural productivity depends on the project type and methodology, the area committed, and how the project is managed. In Pastoral Partners Australia’s experience the carbon projects have enabled significant reinvestment in property infrastructure and technology which has significantly boosted productivity.

There is no one-size-fits-all answer here. Potential income depends on factors including the suitability of the land, project size, methodology, carbon credit generation, carbon prices, project costs, and commercial arrangements. A feasibility assessment is typically undertaken to estimate potential carbon credit generation and project economics before proceeding.

Carbon credit ownership depends on the project structure and contractual arrangements, as typically a carbon service provide may need to be involved to help design and implement the project. In some cases, the project proponent owns the credits and pays the service provider a fee for service; in others, ownership or revenue may be shared between the parties. These arrangements should be clearly defined in project agreements.

Your property would typically undergo an eligibility and feasibility assessment against the relevant methodology before any decision is made to proceed with project registration. Factors such as vegetation history, land condition, location, and project objectives may influence suitability.

No. Only areas that the landholder wants to include and which meet the eligibility requirements of the chosen methodology would generally be included in a carbon project. The proportion of land committed varies considerably between properties and project types and is decided upon by the landholder.

If a property with an existing carbon project is sold, the project’s rights and obligations may stay with the land and transfer to the new owner, depending on the legal and contractual arrangements in place. Carbon projects often involve long-term commitments, so prospective buyers should understand these obligations before purchasing.

Before signing a carbon project agreement, you should understand:

  • What are the likely revenues and costs associated with the project (feasibility assessment)
  • Who owns the carbon credits and associated revenue
  • How income, costs, and risks are shared
  • Any restrictions on land use and grazing management
  • Your reporting and compliance obligations
  • The duration of the agreement and permanence requirements
  • What happens if the property is sold
  • The level of support provided by the project developer or adviser

Independent legal, financial, and accounting advice should be considered before entering into any agreement.

Important information

This information has been prepared by Pastoral Partners Australia Trusco Pty Limited (ACN 658 013 435) a corporate authorised representative of Pastoral Partners Australia Licence Co Pty Ltd (ACN 666 884 466, AFSL licence number 555859). This content is intended for general information purposes only and should not be considered financial advice. It does not take into account your personal goals, financial situation, or needs. Although we believe the information is accurate, we cannot guarantee its accuracy, reliability, or completeness, except where required by law. Before investing, consider whether this information is right for your circumstances and seek advice from a qualified financial professional. Please remember that past performance does not guarantee future outcomes.

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