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5. Right of First Offer (ROFO) / Right of First Refusal (ROFR)

To secure continuity of supply, buyers sometimes negotiate preferential rights over future credits.

  • A ROFO requires the supplier to offer additional CDR credits to the buyer before marketing them to third parties.
  • A ROFR allows a buyer to match offers received from third parties.

These rights can be valuable for buyers aiming to lock in long-term supply, but must be carefully drafted to avoid restricting the supplier's ability to scale or diversify its customer base.

Key elements include:

  • Trigger events
  • Timeframes for response
  • Equivalency of terms

OSCAR's Approach​

OSCAR does not contain a ROFO or ROFR provision.

ROFO and ROFR should be used with caution. They are often difficult to accept for suppliers because it affects their ability to diversify their buyer portfolio and may have an adverse effect on the bankability of the Offtake Agreement.