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11 min ago 2 min read
US oil firm Occidental will receive around two million tonnes per annum (mtpa) of carbon dioxide (CO2) captured from natural gas processing plants for enhanced oil recovery (EOR) in the Permian Basin.
The firm inked two long-term offtake agreements with two unnamed project developers looking to capture CO2 from existing and new gas processing plants in the Delaware Basin, which will build infrastructure to deliver the CO2 to Occidental.
While the length of the deals remains unclear, Occidental said the projects covered by the agreements could collectively capture and transport 2 mtpa of CO2, with potential to expand up to 4 mtpa.
The projects, which are yet to reach final investment decision, include 100 miles of new CO2 pipelines in the Delaware Basin to connect to existing networks in the Permian Basin.
Occidental expects deliveries to begin in 2029.
Vishal Gupta, President and General Manager, EOR Ventures at Occidental, said the CO2 sources supported its plans to extend the productive life of existing oil fields.
“The projects, once operational, will help diversify our CO2 supply, improve access to cost-effective resources and create infrastructure that can connect additional carbon capture projects over time,” he said.
Gupta added that the 45Q federal carbon capture tax credit, which last year was expanded to provide $85 per tonne of CO2 , was “important support” for the investments.
It comes as the oil firm’s subsidiary 1PointFive develops what is expected to be the direct air capture (DAC) plant near Odessa, Texas, for permanent geologic storage.
Occidental expects the 500,000 tonne per year Stratos plant to begin operations in late 2026, following delays due to an unexpected .
CEO Vicki Hollub previously said DAC could play a role in oil wells, which she predicts will reach a production plateau between 2027 and 2030.
