Natsource Reports Explosive Growth in the Greenhouse Gas Market in 2005 and First Quarter of 2006 (y 2)

    
    -- Growth in trading of project-based emission reductions continues to
       increase year over year. Total trade of project-based emission
       reductions increased from 110 Mt in 2004 to 374.3 Mt in 2005. 79 Mt
       were traded in the first three months of 2006. Since 2001, traded
       volumes have increased by a factor of 40, from approximately 9 Mt in
       2001 to 374.3 Mt in 2005.
    -- Prices for compliant project-based reductions have increased, but vary
       considerably depending on type and contract terms. In 2005, the
       (volume-weighted) average price paid for Verified Emission
       Reductions (VERs - candidate CERs from CDM projects that have not been
       registered by the CDM Executive Board) was US$4.43, up 12% from
       US$3.95 in 2004. In Q1 2006, the average VER price was US$5.65, up 14%
       from the 2005 average price. The average price for CERs (candidate
       CERs from CDM projects that have been registered) in 2005 was US$7.04,
       up 37% from US$5.15 in 2004. In Q1 2006, the average CER price jumped
       to US$11.56, up 64% from the 2005 average price. In the secondary
       market, the average price for CERs in 2005 was US$22.21, or nearly
       300% higher than the 2004 average price of US$5.82. In Q1 2006, the
       average price was US$23.33. The average price for Emission Reduction
       Units (ERUs) from Joint Implementation (JI) projects in 2005 was
       US$4.63. This represented a 22% decrease from the 2004 average price
       of US$5.95. In Q1 2006, the average ERU price was US$7.18. The ERU
       price lag was perhaps due to perceived risks and uncertainties
       relating to the JI institutional framework at the national and
       international level.
    -- HFC23 destruction projects accounted for the largest share of traded
       reductions. HFC23 destruction projects created CERs that accounted for
       58% of project-based transaction volumes, up significantly from 36% in
       2004. The next-largest categories were landfill gas projects, at 9% of
       traded volume, and coal mine methane, at 6% of traded volume. The
       combined share of hydro, wind, biomass, other renewables and energy
       efficiency projects declined in 2005.
    -- China created 66% of the project-based reductions traded. Asia created
       73% of the project-based reductions that were traded during 2005 and
       Q1 2006. China alone created 66%, up from only 5% in 2004. India's
       share decreased from 43% in 2004 to only 3% in 2005 and Q1 2006. Latin
       America accounted for 17% of traded volumes, down from 25% in 2004.
       Projects located in Brazil created 10% of traded volumes - second
       after China.
    -- European buyers are largest buyers in the market, followed by the
       Japanese private sector. EU buyers purchased 56% of the project-based
       reductions that were created in 2005 and Q1 2006, up from 41% in 2004.
       77% of European purchases (or 43% of total market volume) are
       attributed to private sector buyers. Japan accounted for 38% of traded
       volumes (versus 36% in 2004), with the private sector accounting for
       nearly all of these transactions.

Natsource has been a major participant in the GHG market since the late 1990s. In October 2005, Natsource announced the final close of the Greenhouse Gas-Credit Aggregation Pool (GG-CAP). A total of euro 510 million (approximately US$640 million) was committed to GG-CAP by 26 participants located in Europe, Japan and Canada. This capital will be used to purchase and manage delivery of a large pool of CERs and ERUs which participants can use to comply with GHG emission targets from 2005-2012.

    
    (a) For a full summary of Natsource's GHG market analysis including
        graphs (Figure 1 noted above), please email somna.maraj@edelman.com.

Natsource LLC is a leading emissions and renewable energy asset management firm. The company's Asset Management, Transaction Services and Advisory and Research Services business units utilize their regulatory, market and trading expertise to assist private firms around the world in the strategic management of environmental risk, and to provide superior returns to investors by taking advantage of opportunities in local, regional, and global emissions and renewable energy markets. Natsource is headquartered in New York and has offices in Calgary, La Paz, London, Ottawa, Tokyo and Washington, DC, providing the company with global reach and proximity to many of the world's leading financial centers. More information is available at http://www.natsource.com.

    
    Natsource Contact Information:
    North America
    Richard Rosenzweig
    Chief Operating Officer
    Washington, D.C.
    (v) +1-202-496-1423 x230
    (mobile) +1-202-841-7276
    Europe
    Dirk Forrister
    Managing Director
    London
    (v) +44-20-7827-2942
    (mobile) +44-77-6678-1719

Web site: http://www.natsource.com

North America: Richard Rosenzweig, Chief Operating Officer, +1-202-496-1423 ext. 230, mobile: +1-202-841-7276; or Europe: Dirk Forrister, Managing Director, +44-20-7827-2942, mobile: +44-77-6678-1719, both of Natsource LLC