Squamish-based carbon-capture firm Carbon Engineering has agreed to be purchased for USD $1.1 billion by Houston-based oil producer Occidental Petroleum, in a deal that the companies said will help scale direct-air-capture technology.
Occidental announced today that a subsidiary has agreed to acquire all the outstanding equity of Carbon Engineering for total cash consideration of approximately $1.1 billion, to be made in three approximately equivalent annual payments.
Occidental has been working with Carbon Engineering on direct air capture (DAC) deployment since 2019.
Acquiring Carbon Engineering aligns with Occidental’s integrated net-zero strategy and provides Occidental, through its 1PointFive subsidiary, the opportunity to rapidly advance DAC technology breakthroughs and accelerate deployment of DAC as a large-scale, cost effective, global carbon removal solution. Carbon Engineering’s DAC-based climate solutions utilize standardized processes and proven industrial equipment.
Upon closing, Carbon Engineering would become a wholly owned subsidiary of Oxy Low Carbon Ventures and Carbon Engineering’s research and development activities and Innovation Center will remain in Squamish.
Carbon Engineering’s personnel will continue to drive ongoing DAC technology development efforts and work closely with the Occidental and 1PointFive teams to bring DAC solutions to market.
“We have always believed that global partnerships and cross-industry collaboration would be required to deploy DAC infrastructure at the scale required to make a climate-relevant impact. Carbon Engineering and Occidental have been working increasingly close together for the past five years to address the CO2 problem, making Occidental a trusted and committed partner for this next chapter in Carbon Engineering’s journey,” said Carbon Engineering CEO Daniel Friedmann.
“At the core of this deeper relationship is the commitment to invest in the development of our technology here in Canada, and the global reach to accelerate implementation of DAC-based climate solutions in the U.S. and around the world.”
1PointFive is building Stratos, the world’s largest DAC plant, which is expected to be commercially operational in mid-2025, in Ector County, Texas.
Occidental and Carbon Engineering are also adapting Stratos’ front-end engineering and design study for a DAC plant to be built at King Ranch in Kleberg County, which is part of the South Texas DAC Hub that was selected to receive a grant from the U.S. Department of Energy’s Office of Clean Energy Demonstrations.