Which CCS startups could be next for an acquisition? The deal is not the first big exit for a CCS company – ArcelorMittal, Mitsui, Novo, Siemens and Petronas-backed LanzaTech got a Nasdaq listing through a $2bn reverse merger in February this year – but it does represent the first big M&A transaction in the sector. “Together, Occidental and Carbon Engineering can accelerate plans to globally deploy DAC technology at a climate-relevant scale and make DAC the preferred solution for businesses seeking to remove their hard-to-abate emissions.” “The acquisition enables Occidental to catalyse broader development partnerships for DAC deployment in the most capital efficient and valuable way,” Occidental president and CEO Vicki Hollub said this week. Earlier backers include Occidental unit Oxy Low Carbon Ventures, which will oversee Carbon Engineering’s activities post-acquisition, as well as mining group BHP and petroleum supplier Chevron’s venture arms. Occidental is already working on similar technology through 1PointFive, a subsidiary that plans to bring its own DAC project online in 2025.Ĭanada-based Carbon Engineering had raised over $110m before adding an undisclosed amount from corporates Airbus and Air Canada in late 2022. Photos courtesy of Carbon Engineering, Ltd.Ĭarbon Engineering became the first carbon capture and storage (CCS) company to achieve a big acquisition exit for its investors this week, after one of those investors, oil and gas producer Occidental agreed to buy it for $1.1bn in cash.ĬCS has emerged as a notable part of the energy transition in recent years, with the traditional fossil fuel industry especially keen to back the technology as it could hypothetically help them meet net zero targets without having to make large-scale changes or reductions to their core businesses.Ĭarbon Engineering’s Direct Air Capture (DAC) system extracts carbon dioxide (CO2) from the air through a series of chemical reactions, a process it compares to photosynthesis.
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