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Woodside to acquire clean ammonia project outside of Houston in  $2.4B deal

seeing green

OCI broke ground on the project in 2022. Photo via oci-global.com

Woodside Energy has announced its acquiring a Beaumont, Texas, clean ammonia project that's slated to deliver its first ammonia by 2025 and lower carbon ammonia by 2026.

The agreement is for Woodside to acquire 100 percent of OCI Clean Ammonia Holding and its lower carbon ammonia project in Beaumont in an all-cash deal of approximately $2.35 billion. According to Woodside CEO Meg O’Neill, the acquisition positions Woodside as an early mover in clean ammonia within the energy transition.

“This transaction positions Woodside in the growing lower carbon ammonia market," O’Neill says in a news release. "The potential applications for lower carbon ammonia are in power generation, marine fuels and as an industrial feedstock, as it displaces higher-emitting fuels.

“Global ammonia demand is forecast to double by 2050, with lower carbon ammonia making up nearly two-thirds of total demand," she continues. “This Project exceeds our capital allocation framework targets for new energy projects. Both phases are expected to achieve an internal rate of return above 10 percent and payback of less than 10 years."

OCI broke ground on the project in 2022. It's reportedly the world’s first ammonia plant paired with auto thermal reforming with over 95 percent carbon dioxide capture.

Phase 1 of the project will have a capacity of 1.1 million tonnes per annum and is currently under construction. The first ammonia production will be derived from natural gas and is slated for 2025, with lower carbon ammonia production — derived from natural gas paired with carbon sequestration — is expected in in 2026 following commencement of CCS operations

According to the release, Phase 2 will have the capacity to abate 3.2 million tonnes per annum CO2-e, "or over 60 percent of our Scope 3 abatement target,” O’Neill explains.

Linde will source the nitrogen and lower carbon hydrogen feedstock from its feedstock facility, which is currently under construction with a targeted completion in early 2026. In the meantime, early supply of feedstock for the project will come from various suppliers including Linde. Per the release, CCS services will be provided to Linde by ExxonMobil and are expected to be available in 2026.

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The rig stands 225 feet tall and extends 8,000 feet below the subsurface. Photo via exxonmobil.com

ExxonMobil breaks ground on Texas carbon dioxide storage project

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ExxonMobil announced this month that it has officially broken ground on a groundbreaking carbon dioxide storage site.

According to a release from the company, a new rig is currently being used to gather information about an underground site in Southeast Texas. The rig stands 225 feet tall, but more importantly extends 8,000 feet below the subsurface to investigate if the site is a safe place to store carbon underground.

“Everyone’s excited about this appraisal well because we’re literally breaking ground on a new chapter of our work to help reduce industrial emissions,” Joe Colletti, who oversees carbon capture and storage development along the Gulf Coast for Exxon, says in a statement.

Exxon plans to move the rig to other sites in the Gulf Coast in the future for clients Nucor Corp., CF Industries and Linde.

In the last year, Exxon has made agreements with these regional companies to store carbon captured from their operations.

  • Exxon agreed to transport and permanently store up to 2.2 million metric tons of carbon dioxide each year from Linde’s hydrogen production facility in Beaumont, Texas when it launches in 2025.
  • Exxon agreed to store up to 2 million metric tons per year of CO2 captured from CF Industries’ ammonia plant in Donaldsonville, Louisiana, starting in 2025.
  • Exxon agreed to capture, transport and store up to 800,000 metric tons per year of CO2 from Nucor’s direct reduced iron manufacturing site in Convent, Louisiana starting in 2026.

Together, the three agreements represent a total of 5 million metric tons per year that Exxon plans to transport and store for third-party customers.

“Our agreement with Nucor is the latest example of how we’re delivering on our mission to help accelerate the world's path to net zero and build a compelling new business,” Dan Ammann, president of ExxonMobil Low Carbon Solutions, says in a statement over the summer. “Momentum is building as customers recognize our ability to solve emission challenges at scale.”

In addition to the carbon storage agreements, the energy giant also completed the acquisition of Denbury Inc. this month in an all-stock transaction valued at $4.9 billion. The deal adds more than 1,300 miles, including nearly 925 miles of CO2 pipelines in Louisiana, Texas and Mississippi to Exxon's CO2 pipeline network.

The deal was first announced this summer.

The Houston energy transition ecosystem is primed for collaborative partnerships – but here's what to keep in mind. Photo courtesy of Digital Wildcatters

Addressing the need for collaboration in Houston's energy transition

Editor's note

When it comes to advancing the energy transition in Houston and beyond, experts seem to agree that collaborations between all major stakeholders is extremely important.

In fact, it was so important that it was the first panel of the second day of FUZE, an energy-focused conference put on by Digital Wildcatters. EnergyCapital HTX and InnovationMap were the event's media partners, and I, as editor of these news outlets, moderated the panel about collaborations.

I wanted to take a second to reflect on the conversation I had with the panelists earlier this week, as I believe their input and expertise — from corporate and nonprofit to startup and investing — was extremely valuable to the greater energy transition community.

Here were my three takeaways from the panel, titled "Collaborative Partnerships: Leveraging synergy in the energy sector."

Early-stage tech startups need bridges to cross their valleys.

The energy transition is a long game — and an expensive one, as Jane Stricker, executive director of the Houston Energy Transition Initiative, explains on the panel. And, just like most startups, the path to commercialization and profitability is long — and definitely not promised.

"When you look at innovation and startups, the multiple valleys of death a startup will go through on their journey, we have to find more ways to bridge those valleys and get more technology to get up that mountain and to a place where it can be scaled," she says.

She explains that corporations aren't always good at innovating, but they are impactful about rolling out de-risked technology at a global scale. But the technology has to get to that point first, so it takes a much earlier intervention for corporates — or another entity, like incubators and accelerators — to help in that developmental process.

"In Houston we have the potential to build out that ecosystem — we already have a lot of pieces in place, so it's about connecting the dots," Stricker says. "It's only by all of the different parts of the ecosystem understanding what each other does and what unique role they play in the process that we can really leverage the strengths of each of them to help create those partnerships and opportunities."

As Amy Henry, CEO of EUNIKE Ventures explains, corporates have their own challenges.

"Energy companies themselves have their own valley of death, and from where they are sitting, that's why they need to collaborate," she says on the panel. "And now we're talking about an unprecedented rate of getting technology commercialized."

EUNIKE works as a go between for corporates — almost as an expansion for them, Henry explains, and they are facing a challenging time too.

"Energy companies are just not early adopters of technology," she says. "But they are also going through their own transformation. At the same time, you've had this huge knowledge leakage in terms of all the workforce reduction."

Startups and corporates speak a different language.

Moji Karimi has had several partnerships with corporations with his biotech startup Cemvita Factory, including a recent offtake agreement with United. For Karimi, it's about learning about your corporate partner.

"In partnerships, especially for startups, you need to understand what is the language of love for the company at time," he says on the panel. "Is it growth, is it perception and PR, is it deployment of capital, or is there a specific bottleneck that we can help remove."

For HETI, Striker says they hope to act as a translator between the two parties.

"How do we enable more connectivity between the companies that have a technology that may be of interest to the larger companies looking for a solution?" Striker explains of HETI's mission. "And how do we make sure industry is communicating opening and broadly?"

Now is the time for action.

For Karimi, the solution is simple: More action is needed.

"Generally, we just need to talk less and do more," he says of what he wants to see from corporates, adding that more checks need to be written.

Based on his own experience, Karimi says some corporates are better to work with than others. He says he prefers working with the companies that don't try to mix in their startup pilots with the "bread and butter" of the business.

"Everyone has so much on their plate," he says, giving the example of Oxy Low Carbon Ventures being an offshoot of Oxy's main business.

Karimi says corporates should think of their startup pilots as an opportunity to try something new and different — something they'd never be able to test internally.

David Maher, business development director of Americas at Linde, says now that there's been regulatory framework, Linde knows what to invest in. The company has a particular interest in hydrogen.

"Another big piece of it is scale," Maher says of what Linde thinks about when considering innovative partnerships. "What's great about Houston is we have density and scale already."

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1PointFive secures new buyer for Texas CO2 removal project​

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Houston’s Occidental Petroleum Corp., or Oxy, and its subsidiary 1PointFive have secured another carbon removal credit deal for its $1.3 billion direct air capture (DAC) project, Stratos.

California-based Palo Alto Networks has agreed to purchase 10,000 tons of carbon dioxide removal (CDR) credits over five years from the project, according to a news release.

The company joins others like Microsoft, Amazon, AT&T, Airbus, the Houston Astros and the Houston Texans that have agreed to buy CDR credits from 1Point5.

"Collaborating with 1PointFive in this carbon removal credit agreement highlights our proactive approach toward exploring innovative solutions for a greener future,” BJ Jenkins, president of Palo Alto Networks, said in the release.

The Texas-based Stratos project is slated to come online this year near Odessa. It's being developed through a joint venture with investment manager BlackRock and is designed to capture up to 500,000 metric tons of CO2 per year. The U.S Environmental Protection Agency recently approved Class VI permits for the project.

DAC technology pulls CO2 from the air at any location, not just where carbon dioxide is emitted. Under the agreement with Palo Alto Networks and others, the carbon dioxide that underlies the credits will be stored in a below-the-surface saline aquifer and won’t be used to produce oil or gas.

“We look forward to collaborating with Palo Alto Networks and using Direct Air Capture to help advance their sustainability strategy,” Michael Avery, president and general manager of 1PointFive, said in the release. “This agreement continues to build momentum for high-integrity carbon removal while furthering DAC technology to support energy development in the United States.”

Houston researchers develop strong biomaterial that could replace plastic

plastic problem

Collaborators from two Houston universities are leading the way in engineering a biomaterial into a scalable, multifunctional material that could potentially replace plastic.

The research was led by Muhammad Maksud Rahman, an assistant professor of mechanical and aerospace engineering at the University of Houston and an adjunct assistant professor of materials science and nanoengineering at Rice University. The team shared its findings in a study in the journal Nature Communications earlier this month. M.A.S.R. Saadi, a doctoral student in material science and nanoengineering at Rice, served as the first author.

The study introduced a biosynthesis technique that aligns bacterial cellulose fibers in real-time, which resulted in robust biopolymer sheets with “exceptional mechanical properties,” according to the researchers.

Biomaterials typically have weaker mechanical properties than their synthetic counterparts. However, the team was able to develop sheets of material with similar strengths to some metals and glasses. And still, the material was foldable and fully biodegradable.

To achieve this, the team developed a rotational bioreactor and utilized fluid motion to guide the bacteria fibers into a consistent alignment, rather than allowing them to align randomly, as they would in nature.

The process also allowed the team to easily integrate nanoscale additives—like graphene, carbon nanotubes and boron nitride—making the sheets stronger and improving the thermal properties.

“This dynamic biosynthesis approach enables the creation of stronger materials with greater functionality,” Saadi said in a release. “The method allows for the easy integration of various nanoscale additives directly into the bacterial cellulose, making it possible to customize material properties for specific applications.”

Ultimately, the scientists at UH and Rice hope this discovery could be used for the “next disposable water bottle,” which would be made by biodegradable biopolymers in bacterial cellulose, an abundant resource on Earth.

Additionally, the team sees applications for the materials in the packaging, breathable textiles, electronics, food and energy sectors.

“We envision these strong, multifunctional and eco-friendly bacterial cellulose sheets becoming ubiquitous, replacing plastics in various industries and helping mitigate environmental damage,” Rahman said the release.

America's only rare earth producer announces $500M agreement with Apple

Digging In

MP Materials, which runs the only American rare earths mine, announced a new $500 million agreement with tech giant Apple on Tuesday to produce more of the powerful magnets used in iPhones as well as other high-tech products like electric vehicles.

This news comes on the heels of last week’s announcement that the U.S. Defense Department agreed to invest $400 million in shares of the Las Vegas-based company. That will make the government the largest shareholder in MP Materials and help increase magnet production.

Despite their name, the 17 rare earth elements aren’t actually rare, but it’s hard to find them in a high enough concentration to make a mine worth the investment.

They are important ingredients in everything from smartphones and submarines to EVs and fighter jets, and it's those military applications that have made rare earths a key concern in ongoing U.S. trade talks. That's because China dominates the market and imposed new limits on exports after President Donald Trump announced his widespread tariffs. When shipments dried up, the two sides sat down in London.

The agreement with Apple will allow MP Materials to further expand its new factory in Texas to use recycled materials to produce the magnets that make iPhones vibrate. The company expects to start producing magnets for GM's electric vehicles later this year and this agreement will let it start producing magnets for Apple in 2027.

The Apple agreement represents a sliver of the company's pledge to invest $500 billion domestically during the Trump administration. And although the deal will provide a significant boost for MP Materials, the agreement with the Defense Department may be even more meaningful.

Neha Mukherjee, a rare earths analyst with Benchmark Mineral Intelligence, said in a research note that the Pentagon's 10-year promise to guarantee a minimum price for the key elements of neodymium and praseodymium will guarantee stable revenue for MP Minerals and protect it from potential price cuts by Chinese producers that are subsidized by their government.

“This is the kind of long-term commitment needed to reshape global rare earth supply chains," Mukherjee said.

Trump has made it a priority to try to reduce American reliance on China for rare earths. His administration is both helping MP Materials and trying to encourage the development of new mines that would take years to come to fruition. China has agreed to issue some permits for rare earth exports but not for military uses, and much uncertainty remains about their supply. The fear is that the trade war between the world’s two biggest economies could lead to a critical shortage of rare earth elements that could disrupt production of a variety of products. MP Materials can't satisfy all of the U.S. demand from its Mountain Pass mine in California’s Mojave Desert.

The deals by MP Materials come as Beijing and Washington have agreed to walk back on their non-tariff measures: China is to grant export permits for rare earth magnets to the U.S., and the U.S. is easing export controls on chip design software and jet engines. The truce is intended to ease tensions and prevent any catastrophic fall-off in bilateral relations, but is unlikely to address fundamental differences as both governments take steps to reduce dependency on each other.

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