Occidental (NYSE: OXY) announced its subsidiary's definitive agreement to acquire all outstanding equity of Carbon Engineering Ltd. for C$1.49 billion (US$1.1 billion), payable in three equal annual installments. Expected to close by the end of 2023, the deal awaits Canadian and U.S. regulatory approvals and customary closing conditions.

Since 2019, Occidental has partnered with Carbon Engineering in direct air capture (DAC) deployment. This acquisition, part of Occidental's net-zero strategy, will allow its subsidiary 1PointFive to enhance DAC technology and scale up its global carbon removal capacity. Carbon Engineering's solutions are based on standardized processes and proven industrial equipment.

Occidental President and CEO Vicki Hollub stated that the acquisition would increase shareholder value by driving technology innovation and reducing DAC costs. It also introduces new revenue streams through technology licensing and royalties, and fosters broader DAC development partnerships.

Post-acquisition, Carbon Engineering will be a subsidiary of Oxy Low Carbon Ventures, with its team continuing DAC technology development and collaborating on marketable DAC solutions. Their R&D activities and Innovation Center will stay in Squamish, British Columbia.

Daniel Friedmann, CEO of Carbon Engineering, emphasized the importance of global partnerships for impactful DAC deployment. Additionally, 1PointFive is building Stratos, the world's largest DAC plant in Texas, with plans to adapt its design for another plant at King Ranch, Texas, supported by a U.S. Department of Energy grant.