Occidental Petroleum (OXY.N) has revealed its strategic initiatives to advance its clean energy transition business, which includes significant investments in carbon capture. The company plans to allocate between US$800 million and US$1 billion to construct a facility aimed at removing 1 million metric tons (1mT) of CO2 from the atmosphere annually. The project, scheduled to commence construction in the second half of this year in the Permian Basin, the largest oilfield in the United States, is expected to begin operations in 2024.
Notably, this initiative stands out as it is 100 times larger in scale compared to all 19 currently operational direct air capture (DAC) plants worldwide.
In a recent development, Airbus announced a long-term contract to purchase carbon credits from the reference case plant. Occidental Petroleum has further outlined its plans to establish three carbon sequestration hubs, scheduled to become operational by 2025, and an additional 69 smaller DAC facilities by 2035. The company’s executives have refrained from providing specific details on when the low-carbon division is anticipated to become profitable, as large-scale commercial viability for DAC is not yet realized.
These ambitious endeavors underscore Occidental Petroleum’s commitment to embracing clean energy technologies and carbon capture, positioning the company as a key player in the transition towards a more sustainable future.