Occidental Petroleum will acquire Carbon Engineering in a deal valued at more than $1 billion, the latest sign of burgeoning interest among oil majors in companies focused on carbon mitigation. The transaction is expected to close by the end of the year, according to a Tuesday release , and it will help Occidental develop carbon air capture solutions as clean energy grows increasingly important to corporate America. The two companies have partnered on projects in the past. OXY YTD mountain Occidental shares are up just over 1% since the start of the year. Occidental, which is a top holding of Warren Buffett ‘s Berkshire Hathaway , is one of a handful of companies eyeing the capture, use and storage of carbon as a long-term business venture. So-called CCUS is considered a key part of the broader shift to clean energy. That’s because it can provide an alternative way to balance out emissions considered to be basically impossible to avoid by storing or reusing the gas rather than completely removing its use. “Other than maybe Barbie dolls , nothing is flying off the shelves faster these days than ‘Carbon Capturers,'” said Gordon Haskett analyst Don Bilson in a note to clients Wednesday. The company expects to align the Canadian air capture company with the work of 1PointFive, the Occidental-owned business already working on the technology. Bilson said the acquisition should help speed up Occidental’s timeline for releasing a global carbon removal offering. CCUS has picked up traction in recent years, though these types of projects have been around for at least half a decade. Despite the uptick, energy research firm Wood MacKenzie has estimated global carbon storage volume will need to grow by more than four times the amount expected to be in place by 2050 to keep global warming below 1.5 degrees above pre-industrial levels. Occidental has caught the eye of others on Wall Street for its focus on CCUS, with Goldman Sachs listing it as a likely beneficiary of the Inflation Reduction Act’s benefits for carbon storage. Wall Street firms are also watching a handful of other companies such as Baker Hughes , Weyerhaeuser and Bloom Energy as potential winners amid the growing focus on carbon technology. Interested in learning more about carbon capture and the major stocks in the space? Click here to read more from CNBC Pro.
