Lines Drawn in DAC Battle as Oxy Bulks Up

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Battle lines in the emerging direct air capture (DAC) sector are starting to take shape. In the biggest corporate move yet, Occidental Petroleum this week announced it will acquire Canada-based Carbon Engineering, its preferred DAC technology partner, for $1.1 billion in cash. The deal solidifies Oxy’s already large lead on its DAC rivals. It brings a commercial-ready technology in-house and, Oxy says, allows the company to accelerate cost reductions and deployments of DAC globally. More broadly, Oxy’s DAC ambitions underscore a swell of interest in the technology and set a bar for other players pursuing carbon-removal solutions. The acquisition capped two weeks of good news for Oxy and the larger DAC sector. Days earlier, the US Department of Energy (DOE) unveiled the first batch of awards under its $3.5 billion Regional DAC Hubs program, created in 2021. Oxy will receive a DOE grant worth at least $500 million to develop a hub in South Texas, where it has floated plans to build as many as 30 DAC plants. DOE also selected technology-focused nonprofit Battelle to receive at least $500 million for a hub dubbed Project Cypress in Louisiana, alongside DAC specialists Climeworks and Heirloom. Another 19 early-stage DAC projects also received funding. Earlier, Oxy agreed with Abu Dhabi National Oil Co. (Adnoc) to jointly evaluate potential investments in both DAC and carbon capture and storage (CCS), potentially paving the way for the first large-scale DAC facility built outside the US.

Carbon Capture (CCS), Majors, Corporate Strategy , Biofuels (incl. SAF), Emerging Technologies, CO2 Emissions, Low-Carbon Policy, M&A, Independent E&Ps
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