Carbon Clash: In the vast expanse of Texas and neighboring Louisiana, a tale of divergent philosophies is unfolding as oil and gas behemoths grapple with carbon removal strategies. At the forefront of this clash are Occidental Petroleum and Climeworks, each championing its unique approach to combating climate change. As the 28th United Nations climate change conference (COP28) approaches, the spotlight intensifies on the role of carbon removal in a climate-friendly future.
Occidental Petroleum, a major player in the energy sector, is constructing a colossal facility in Texas dedicated to extracting 500,000 tonnes of carbon dioxide annually from the atmosphere. This ambitious venture is backed by none other than investment giant BlackRock, injecting hundreds of millions of dollars into the project. The twist in Occidental’s carbon removal tale lies in its unconventional strategy: some of the captured carbon is slated to be injected into oil fields to boost pressure and increase crude production.
The company contends that this approach can mitigate the climate impact of future fossil fuel consumption, presenting a controversial synergy between carbon removal and oil production. Occidental’s CEO, Vicki Hollub, sees direct air capture (DAC) as a pivotal tool granting the oil industry a “license to continue to operate for the next 60, 70, 80 years.”
In a neighboring state, a consortium led by Climeworks, a Swiss firm, and Heirloom is forging an alternative vision. Project Cypress in Louisiana aims to pull a million tonnes of carbon dioxide out of the sky annually. Crucially, Climeworks and Heirloom advocate for a clean break from fossil fuels. Their captured carbon is destined for underground storage, emphasizing a commitment to renewable energy as the indispensable companion to carbon removal.
Christoph Gebald, CEO of Climeworks, underscores the divergent paths: “If you use air capture to get more fuels out of the ground, you’re taking away market potential for renewables. This is not in alignment with the energy transition.”
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The clash between Occidental and Climeworks reflects a broader global debate on the role of carbon removal technologies in addressing climate goals. COP28, scheduled for November 30 to December 12, is expected to be a battleground for differing ideologies. The host, OPEC member the United Arab Emirates, advocates for carbon removal as a means of reducing emissions from fossil fuels, rather than phasing out these fuels entirely.
However, environmentalists and some governments remain skeptical, viewing carbon removal as a potential fig leaf for the fossil fuel industry. The International Energy Agency (IEA) recently criticized the oil and gas industry’s reliance on carbon capture, deeming it “an illusion.”
Amid the clash of ideologies, an underlying financial dynamic comes to the fore in the carbon removal industry. Occidental’s strategy, albeit controversial, presents a more immediate revenue source—enhanced oil recovery. By using captured carbon to ramp up oil production, Occidental can potentially make money in the short term.
On the flip side, Climeworks and Heirloom acknowledge the need for a more sustainable approach, focusing on marketing carbon removal credits to corporations outside the fossil fuel realm. Their revenue model hinges on corporations and governments seeking to offset emissions without contributing to the fossil fuel market.
Both Occidental’s DAC strategy and Climeworks’ clean break from fossil fuels underscore the complexities and uncertainties surrounding carbon removal technologies. With only a few commercial DAC facilities currently operational and the technology’s high cost, questions linger about the scalability and viability of these projects.
As the world grapples with the imperative to decarbonize, the clash between oil giants reflects the wider struggle to strike a balance between innovation and regulation, between profit motives and environmental stewardship. COP28 will serve as the battleground for these conflicting visions, and the outcome may well shape the trajectory of climate action in the years to come.