Hundreds of thousands of carbon credits or Certified Emission Reductions (CERs) related a project to collect and use associated gases from the Rang Dong oil field in the southern province of Ba Ria - Vung Tau will be auctioned for the first time in Hanoi this December.

This is the first Clean Development Mechanism project (CDM 0152) that has received such a certificate, said auction organizer, PetroVietnam Finance Corporation (PVFC), on November 30.

PVFC will auction 350,000 carbon credits in Hanoi, which are issued for the period from December 1 2001 to December 31, 2005. Each unit of CERs is equivalent to one tonne of carbon dioxide. The price for CERs in Europe has soared from Eur3 from 2003 to Eur13-14 at present.

By the deadline on November 19, PVFC had received 10 letters of interest from banks and industrial organizations in the European Union and US. PVFC is short-listing those who are eligible.

The Clean Development Mechanism is an arrangement under the Kyoto Protocol allowing industrial countries with greenhouse gas reduction commitments to invest in ventures that reduce emissions in developing countries as an alternative to more expensive emission reductions in their own countries.

Environmental specialists estimate Vietnam can earn around US$250 million from CDM projects being carried out in 2010.

However, due to strict conditions for CDM registration, the country has till now implemented only a small number of CDM projects such as the one in the Rang Dong oil field, - a project designed to improve the efficiency of energy use in Thanh Hoa Beer Company.

Other potential projects include one to collect CH4 gas for electricity generation at the Go Cat dumping ground in HCM City and a project by Japanese companies Mitsui and Marubena at the Mao Khe coal mine in Quang Ninh province.