The problem
Even aggressive emissions cuts leave decades of legacy CO2 in the atmosphere. Removing it at megaton scale needs technology that is both proven and cheap enough to replicate — and before Carbon Engineering, direct air capture looked like lab equipment, not infrastructure.
How it works
Carbon Engineering’s plants use large fans to push ambient air through a liquid potassium-hydroxide solution that chemically binds CO2. The captured carbon takes one of two paths: permanent geologic storage underground, or conversion into carbon-neutral liquid fuels using renewable energy — a route the company calls AIR TO FUELS. The design deliberately uses standardized processes and proven industrial equipment so plants can be replicated rather than reinvented. The approach was proven at a Squamish, B.C. pilot plant before Occidental began deploying it commercially through its 1PointFive subsidiary.
Pain points
Conventional carbon capture only works at smokestacks; dispersed historic emissions had no removal path. Early DAC concepts depended on bespoke hardware with frightening unit economics, and buyers of carbon removal had almost no large-scale supply to purchase.
Business model
Technology development plus deployment partnerships: Carbon Engineering designs the DAC and AIR TO FUELS plants and scales them through partners — principally Occidental’s 1PointFive, which is building STRATOS, the world’s largest DAC facility, in Ector County, Texas.
Challenges
Each commercial plant is capital-intensive first-of-a-kind engineering — STRATOS must prove a 500,000-tonne-per-year facility can run reliably. Long-run success hinges on driving capture costs down and locking in durable demand for carbon removal at prices the market will pay.
Funding
- Raised: pre-acquisition venture funding undisclosed in citable sources — MISSING.
- Valuation: MISSING.
- Status: acquired — Occidental bought all outstanding equity for ~US$1.1B in cash (three annual instalments), announced August 2023 and closed November 3, 2023; Carbon Engineering became a wholly owned subsidiary of Oxy Low Carbon Ventures.
Latest — April 2025
Occidental and 1PointFive announced EPA approval of Class VI permits to sequester CO2 captured from STRATOS — the first permits ever issued for storing CO2 from a direct-air-capture project — with the Texas facility designed to capture up to 500,000 tonnes of CO2 per year and on track for commercial operations in 2025.