Occidental’s fully owned subsidiary 1PointFive has secured up to $500m from the US Department of Energy (DoE)’s Office of Clean Energy Demonstrations (OCED) to support the development of the South Texas direct air capture (DAC) hub.
Located on the King Ranch in Kleberg County, Texas, the South Texas DAC hub will feature a facility with an initial capacity to remove 500,000 metric tons of carbon dioxide annually.
1PointFive plans to increase this capacity to over one million metric tons per year in the future.
The South Texas site has the potential to expand to a removal capacity of 30 million metric tons of carbon dioxide per year through DAC. It can also securely store up to three billion metric tons of carbon dioxide in saline formations.
US DoE will allocate the funding in several phases, with an initial grant of $50m to advance 1PointFive’s ongoing work at the South Texas DAC hub.
1PointFive’s upcoming activities at the South Texas site include engineering, permitting, procuring long-lead equipment, and ongoing community engagement to advance the company’s community benefits plan.
The total financing for the DAC facility at the site is expected to reach up to $650m for the development of a broader regional carbon network in South Texas.
Occidental president and CEO Vicki said: “Large-scale Direct Air Capture is one of the most important technologies that will help organisations and society achieve their net zero goals.
“This award demonstrates how the US Department of Energy is committed to realising the full potential of DAC and its confidence in the South Texas DAC Hub to deliver CO2 removal at a climate-relevant scale.”
In line with the development of the hub, 1PointFive is also advancing its community benefits plan. It focuses on creating local employment opportunities, workforce development, and educational initiatives for the South Texas region.
In November 2023, Occidental also secured $550m from BlackRock for the development of the South Texas DAC hub.
Last month, Occidental wrapped up its previously announced $12bn acquisition of US-based Midland Basin oil and gas producer CrownRock.
