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Our work identified four material risk areas. Carbon credit price assumptions were above market reality, and existing credit offtake obligations created exposure if pricing fell. The sequestration potential per ton of biochar was reasonable, but depended heavily on the reliable operation of a technology supplier with a limited track record. We also flagged areas requiring legal review around contractual agreements and ownership transfer risks, and identified where technology support gaps could affect operational continuity.
These findings gave Mekong Capital a clear map of operational, contractual, and market risks. The investor could evaluate the project’s financial outlook using more conservative revenue assumptions, consider performance-linked investment tranches tied to commissioning and credit delivery, incorporate legal review of carbon credit contracts into the investment process, and build risk mitigation actions into post-investment support. We also explored diversification strategies to ensure market-entry assumptions remained realistic.
Mekong Capital proceeded with the $5 million investment from Mekong Enterprise Fund IV, supporting the scaling of production capacity, distribution networks, and farmer training programs. Our assessment helped the investor understand both the scale and maturity of Husk’s operations and the company’s capacity to expand climate-positive agriculture across the region.
