Save for later Print Download Share LinkedIn Twitter US independent Occidental Petroleum may accelerate its plans to build dozens of direct air capture (DAC) plants thanks to incentives provided by recent legislation, the company’s CEO said Wednesday.“Our plan had been to build 70 of these [DAC plants] by 2035. Now we're going to be able to accelerate that because of [the Inflation Reduction Act],” Oxy CEO Vicki Hollub said during a breakfast session at the Energy Intelligence Forum in London.Oxy has been measured in its comments regarding the landmark legislation, which was passed in August and significantly enhanced the tax credits provided to companies that capture and sequester carbon dioxide.Executives have broadly referenced the act as enabling Oxy to accelerate DAC technology, and potentially its development plans. But Hollub’s comments on Wednesday were her clearest yet regarding the direct impact the legislation has on Oxy’s projected timeline for rolling out its planned fleet of plants.'Incentives Develop Technology'The Inflation Reduction Act more than tripled the available tax credits for DAC to up to $180 per ton for storage and $130/ton for captured CO2 used in enhanced oil recovery (EOR). It also boosted tax credits for point-source carbon capture and storage.Hollub said Oxy was going to build its first DAC plant, in the Permian Basin, with or without the new law, but that incentives like those now available in the US are crucial in the ability to develop new technologies to reduce emissions.She said governments around the world should place a price on carbon to drive down emissions, “but if we wait for that price of carbon to be imposed by governments around the world, it will be way too late.”“What needs to come first are the incentives. Incentives develop technology,” she said at the Forum. A price on carbon would advance the use of that technology, Hollub said, "but it's always incentives that advance it, because waiting on the imposition of something that's going to charge you for the carbon that you emit is too far down the road, and we'll never get that adopted uniformly around the world.”'Not About the Fuel Source'Oxy, through its 1PointFive subsidiary and in partnership with technology provider Carbon Engineering, was due to break ground on the Permian DAC plant in the third quarter. It is due on line in late 2024.It is expected to be the world’s largest DAC facility, with initial capacity to capture up to 500,000 tons of CO2 per year and the potential to double that to 1 million tons/yr. Oxy aims initially to use CO2 captured at the plant for EOR at its operations in the Permian.“We can't stop oil today. We can’t stop oil in the next 10 to 20 to 30 years, and in fact, we don't need to ever stop oil because it's really about the emissions, it's not about the fuel source," Hollub said. “We believe that using CO2 and enhanced oil recovery provides a means to generate net zero-carbon oil so that we can help to decarbonize aviation and maritime industries.”Oxy has estimated that DAC-1, as it is known, will require around $800 million-$1 billion in investment. Rapid scaling, technology innovations and standardization could drive down the levelized cost by 15%-20% over time, the company has said.It aims to reduce its net emissions by some 270 million tons over a decade through its DAC plants.