dac funding

DOE deploys more than $10M into Houston-related carbon capture projects

Four direct air capture projects with ties to Houston just received federal funding. Photo via Getty Images

Four carbon capture projects with ties to the Houston area have collectively received more than $10 million in funding from the U.S. Department of Energy.

What follows is a funding rundown for the four direct air capture (DAC) projects. DAC pulls carbon dioxide emissions from the atmosphere at any location, while carbon capture generally is done where the emissions happen.

This funding announcement comes on the heels of a subsidiary of Houston-based Occidental receiving about $600 million from the Department of Energy (DOE) for establishment of a DAC hub in South Texas.

Western Regional Direct Air Hub

Houston-based Chevron New Energies, the low-carbon subsidiary of energy giant Chevron USA, is collecting nearly $5 million in funding — $3 million of it from the DOE — for a potential DAC hub in the Bakersfield, California, area.

Chevron says it plans to install equipment at its cogeneration plant in Central California’s San Joaquin Valley so it can inject and permanently store carbon dioxide emissions underground. This is Chevron’s first carbon capture and storage project.

A cogeneration plant produces several forms of energy from a single fuel source.

Last year, Chevron was the lead investor in a $381 million series E funding round for Svante, a Canada-based producer of carbon capture technology.

“Several carbon capture technologies exist today, and they all have important roles to play in addressing the diverse requirements of hard-to-avoid emissions,” Claude Letourneau, president and CEO of Svante, said in a June 2023 announcement about the Central California DAC hub.

Pelican-Gulf Coast Carbon Removal project

Louisiana State University in Baton Rouge has attracted nearly $4.9 million in funding — including nearly $3 million from the DOE — for the proposed Pelican-Gulf Coast Carbon Removal project in the Pelican State. Partners in the Pelican project include the University of Houston and Shell, whose U.S. headquarters is in Houston.

The DAC project would remove CO2 in the atmosphere and permanently store it underground.

Red Rocks DAC Hub

Houston-based Fervo Energy is earmarking earmark its nearly $3.6 million in funding — including almost $2.9 million from the DOE — for development of the Red Rocks DAC Hub in southwest Utah.

Fervo believes more than 10 gigawatts of geothermal resources are available in southwest Utah that would translate into the potential storage of up to 100 million tons of CO2 each year.

“Scaling DAC technology will require abundant clean, firm power and heat to build truly carbon-negative projects,” Fervo says in a LinkedIn post. “As the leader in next-generation geothermal, Fervo is well positioned to support and accelerate the commercial deployment of DAC, while placing Utah at the heart of the energy transition.”

Houston Area DAC Hub

GE Research, the Niskayuna, New York-based R&D arm of General Electric, has scooped up more than $3.3 million in funding — including over $2.5 million from the DOE — to explore creating a DAC hub in the Houston area that would involve clean energy, such as renewable or nuclear power.

The project, being developed in conjunction with Omaha, Nebraska-based energy company Tenaska, would be designed to remove 1 million metric tons of CO2 from the air and permanently store it or use it in a value-add project (or both). Tenaska opened an office in Houston in 2019.

“We know that to truly bring an economical, commercial-scale solution in DAC to the market, it will require a collaborative effort with government, industry, and academic partners,” David Moore, leader of GE’s carbon capture team, said in March 2023. “If we do this right, we could have a commercially deployable DAC solution around the end of this decade.”

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A View From HETI

ExxonMobil has secured its seventh CCS contract. Photo courtesy ExxonMobil

Spring-based energy powerhouse ExxonMobil has picked up another project in the carbon capture and storage (CCS) market.

Natural gas pipeline operator Williams Cos. has tapped ExxonMobil to transport and store up to one metric ton per year of CO2 from Williams’ natural gas collection and processing plant in southwest Louisiana’s Haynesville Shale.

Williams will transport natural gas via its Louisiana Energy Gateway pipeline, then process the natural gas and deliver it to the Gulf Coast for export as liquefied natural gas (LNG). The LNG will be used in power generation, residential and commercial heating, and industrial processes.

Williams recently agreed to acquire Momentum Midstream for up to $5.5 billion to expand Williams’ LNG presence in the Haynesville Shale. Haynesville is the country’s third-largest producer of natural gas.

Once the deal closes, Williams will own a $1.5 billion project in southwest Louisiana that will expand capacity of the Transco natural gas distribution system. The system serves power and LNG-export customers. Williams will also gain over 4,000 miles of pipeline and more than one million acres.

While Williams is based in Tulsa, Oklahoma, it has a significant presence in Houston. Last month, Green Street’s Real Estate Alert reported Williams bought the 64-story, 1.4 million-square-foot Williams Tower south of The Galleria from Invesco Real Estate for more than $300 million. The company will occupy about 360,000 square feet in the skyscraper for its Houston hub.

Williams employs about 800 people in Bayou City, including roughly 700 who work at Williams Tower, and plans to hire another 100 by the end of this year.

The Williams deal is ExxonMobil’s seventh CCS contract. ExxonMobil’s CCS portfolio supports LNG, lower-carbon-intensity steel, ammonia, natural gas processing, industrial gases and methanol.

ExxonMobil has established a “carbon superhighway” along the Gulf Coast to fuel its CCS business. The company owns and operates a more than 1,300-mile CO2 pipeline system, the largest in the U.S.

“Carbon capture is becoming an increasingly important part of industrial operations, but capture alone doesn’t solve the problem of high emissions,” says ExxonMobil. “What matters next is how CO2 is transported, used, and stored.”

ExxonMobil’s CCS initiatives are aimed at capturing a chunk of the rapidly growing CCS market in the U.S. Straits Research forecasts the market will grow from $5.66 billion this year to $13.56 billion by 2034.

“It’s not every day you get to witness the birth of a new American industry, but that’s exactly what’s happening right now at the U.S. Gulf Coast,” Dominic Genetti, senior vice president of CCS at ExxonMobil, wrote in an article published last year on the company’s website.

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