Oil and Gas Giant Occidental Acquires Carbon Removal Innovator Holocene: A Game-Changer in Climate Solutions
Occidental Petroleum has made headlines by acquiring Holocene, a notable step in its commitment to carbon capture technology. This marks the company’s second purchase of a direct air capture startup within two years, emphasizing its strategy to expand in the sustainable energy sector.
Details of the Acquisition
The acquisition was finalized through Oxy Low Carbon Ventures, a subsidiary of Occidental Petroleum, although the financial terms of the deal remain undisclosed. The news was initially reported by HeatMap.
Holocene’s Innovative Technology
Holocene has been actively advancing its unique amino acid-based carbon removal technology. In a significant move, the company secured a $10 million agreement with Google in September to facilitate the removal of 100,000 metric tons of carbon by the early 2030s.
Cost-Effective Carbon Removal
- Holocene’s pricing for carbon removal is set at $100 per metric ton, considerably lower than competitors.
- The current market rate for direct air capture is approximately $600 per metric ton.
Occidental’s Strategic Interest in Carbon Capture
Occidental’s focus on carbon capture technology is closely linked to its practice of enhanced oil recovery. This method involves injecting carbon dioxide deep underground to boost oil production. In 2023, Occidental further solidified its position in the market by acquiring another direct air capture startup, Carbon Engineering, for a staggering $1.1 billion.
Future Implications and Tax Incentives
A spokesperson from Occidental indicated that the company plans to leverage Holocene’s technology to enhance its research and development in direct air capture. This initiative aligns with the provisions of the Inflation Reduction Act, under which direct air capture technologies can qualify for tax credits. The final tax incentives will depend on whether the technology operates on zero-emission power and how the captured carbon dioxide is utilized.
As Occidental continues to invest in innovative carbon capture solutions, the implications for both the fossil fuel industry and environmental sustainability are significant, potentially paving the way for a more sustainable future.
