Trafigura has agreed to buy an undisclosed amount of carbon dioxide removal credits from Occidental Petroleum subsidiary 1PointFive, which is building an industrial-scale direct air capture facility in Texas, to help offset its emissions, the global commodities trader said on Tuesday.
Trafigura said in an email to OPIS that both companies had agreed not to disclose the CDR volume.
It also did not reveal the financial details of the deal, announced on the second day of the World Economic Forum annual meeting in Davos, Switzerland.
As a founding member of the WEF-backed First Movers Coalition, a global alliance of companies leveraging their purchasing power to decarbonize the world’s heavy emitting sectors, Trafigura has committed to buy at least 50,000 CDRs generated through advanced technologies by 2030.
The 1PointFive plant in the Permian Basin is scheduled to become operational next year. It will have an initial capacity to capture 500,000 metric tons of CO2 per year, but Occidental has said that the capacity could be expanded to 1 million mt/year.
Carbon captured by the plant will be stored deep underground in saline aquifers.
Trafigura said the purchase will help reduce emissions associated with the supply of energy and commodities. The agreement also marks the establishment of a relationship between the two companies to advance DAC as a practical, transparent and durable carbon removal solution, it added.
It is the latest CDR deal involving 1PointFive in recent months.
On Thursday, Boston Consulting Group said that it had agreed to buy 21,000 CDRs over three years from the company. In November, Canada’s TD Bank Group announced that it will buy 27,500 CDRs over four years from 1PointFive, and just months earlier, ecommerce giant Amazon agreed to buy 250,000 CDRs over 10 years from the company.
This content was created by Oil Price Information Service, which is operated by Dow Jones & Co. OPIS is run independently from Dow Jones Newswires and The Wall Street Journal.
–Reporting by Abdul Latheef, [email protected]; Editing by Michael Kelly, [email protected]
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