(World Oil) – Occidental and its subsidiary 1PointFive today announced an agreement with XRG, ADNOC’s investment company, to evaluate a potential joint venture to develop a Direct Air Capture (DAC) facility in South Texas.
As part of the joint venture, XRG will consider investing up to $500 million for the development of a DAC facility designed to capture 500,000 tonnes of carbon dioxide per year. The Strategic DAC Framework Agreement was signed by Occidental President and CEO Vicki Hollub and ADNOC Group CEO Dr. Sultan Ahmed Al Jaber, during U.S. President Donald J. Trump’s state visit to the United Arab Emirates.
The announcement follows several significant milestones in the development of DAC, including Occidental’s progress on STRATOS, its first DAC facility in West Texas, which is on-track to start commercial operations in 2025; further de-risking of Occidental’s DAC technology; and an award from the U.S. Department of Energy for up to $650 million to support development of the South Texas DAC Hub.
“We are proud to advance our decades-long partnership with ADNOC and XRG on our South Texas DAC Hub, which we believe will deliver game-changing technology to support U.S. energy independence and global goals,” said Hollub. “Agreements like this, along with U.S. DOE support, demonstrate continued confidence in DAC as an investable technology that can create jobs and economic value in the United States and Texas.”
“Our longstanding partnership with Occidental continues to drive scalable, high-growth and strategically attractive projects that create long-term sustainable value,” said Khaled Salmeen, Chief Operating Officer, XRG. “The U.S. is a priority market for XRG and we look forward to building on this partnership as we continue to invest in strategic projects across the energy value chain.”
Occidental and ADNOC have been discussing opportunities to collaborate on carbon capture, utilization and storage projects in the United States and UAE since signing a memorandum of understanding in 2023.
The South Texas DAC Hub, located on the King Ranch in Kleberg County, Texas, will be close to industrial facilities and energy infrastructure along the U.S. Gulf Coast, where CO2 can be transported for use or securely stored in geologic formations. The site comprises approximately 165 square miles of acreage with the potential to store up to 3 billion tonnes of carbon dioxide (CO2). The first DAC facility at the Hub is expected to capture 500,000 tonnes of carbon dioxide per year and is currently in front-engineering and design.
XRG focuses on transformational global investments that create value across natural gas, chemicals and lower-carbon energy solutions. Occidental and ADNOC have a long-standing partnership at Al Hosn Gas, one of the largest Middle Eastern natural gas developments, and onshore oil and gas development projects in the UAE.
