Australian Financial Review | 25 May 2025

by Nick Lenaghan

One of Hong Kong’s wealthiest tycoons, Li Ka-Shing, whose interests include energy and agricultural investments in this country, has forged into the carbon market, acquiring a vast Western Australian landholding earmarked for a ‘regenerative agriculture’ project.

The ageing billionaire founded the CK Group, which through its various subsidiaries, including Hong Kong-listed CK Life Sciences and CK Hutchison, has a business empire spanning infrastructure, transport, real estate, and financial services.

Hong Kong business magnate Li Ka-Shing. China News Service via Getty Images

While Li has a global profile, most recently clashing with Beijing over his blockbuster ports deal with US giant BlackRock, his companies have also quietly accumulated a diverse portfolio in Australia. Li handed control of the business empire to his son, Victor Li, in 2018.

In the agricultural sector, CK Group’s investments range from vineyards to agribusiness and salt production. Its subsidiaries also own Australian Gas Infrastructure Group (AGIG), which runs a transmission and distribution network, delivering gas to homes and industry across four states and the Northern Territory.

The group’s $13 billion bid for east coast gas pipeline owner APA Group was rejected by the federal government in 2018, however.

The most recent addition to CK Group’s portfolio in Australia is its acquisition of a pastoral lease and rights of over 350,000 hectares of agricultural land in WA.

Flagged in its annual report last month, the land is described as “an area larger than three times the size of Hong Kong”, dedicated to regenerative agriculture and carbon sequestration, with a project approved by the Australian Clean Energy Regulator.

“Our decision to enter the regenerative agriculture sector is motivated by the hope that through these regenerative agriculture schemes, we will make our contributions towards carbon reduction,” a spokesperson for CK Life Sciences told The Australian Financial Review.

“Additionally, as ACCUs [Australian carbon credit units] are tradeable in Australia and have monetary value, the potential financial return from selling ACCUs generated by the carbon project is also a factor in our decision.”

The Western Australian acquisition, however, is not connected to the group’s gas company AGIG and its carbon emissions offsetting initiatives, the spokesperson said.

AGIG has one of the 219 high-emitting facilities and businesses in the mining, oil and gas, manufacturing, transport and waste sectors which fall under the federal safeguard mechanism, a key element in the national effort to reduce carbon emissions.

The mechanism sets a limit on emissions for big emitters and their projects. Facilities that exceed their baseline can purchase carbon credits as offsets, while some companies, including AGIG, whose emissions fall below their government-mandated threshold can trade their excess credits.

Foreshadowing its WA acquisition late last year, CK Life Sciences said its regenerative agriculture portfolio used the human-induced-regeneration (HIR) method, applied to native forests, to store carbon. The group’s regenerative agriculture portfolio was projected to sequester around 1 million tonnes of carbon dioxide equivalent in total, it said.

The HIR method involves crediting emissions reductions to landholders who regenerate native forests where growth has been suppressed for at least 10 years.

The integrity of the method has been heavily criticised. A government review in 2023 found the method was basically sound while recommending additional requirements. Nevertheless, the method expired later that year, with no new projects to be registered, although existing projects can continue.

Details around the CK Group’s WA acquisition and its associated carbon project remain sketchy. The landholding is thought to be near Sandstone in WA’s East Murchison region, according to industry sources.

Scores of carbon projects in the East Murchison area and across the WA outback are registered with the Clean Energy Regulator, many of which involve fostering permanent native forest growth through assisted regeneration from “in-situ seed sources”, according to the CER register.

Elsewhere, uncertainty over carbon rules and delays in the introduction of a new method called “integrated farm and land management” have prompted some big international players to pause their investment plans.

In March, Hartree, a global commodities trader and carbon player, part-owned by funds giant Brookfield, put a 450,000-hectare Northern Territory cattle station on the market where it hoped to set up an offset scheme, citing the need for more clarity on new carbon methods.