Oil and gas companies like Occidental are increasing their investment in carbon capture technology, primarily to enhance oil extraction. Despite previous commitments to reduce emissions, CEO Vicki Hollub has emphasized the use of carbon dioxide (CO2) to increase oil production. This strategy is comparable to fracking, which has significantly boosted U.S. oil and gas output.
Enhanced oil recovery using CO2 injection remains expensive, but government incentives provide financial support. The Inflation Reduction Act offers tax credits for CO2 storage, making the practice more economically viable. Direct air capture, which extracts CO2 from the atmosphere, offers a plentiful CO2 source for enhanced oil recovery.
Historically, oil companies have utilized carbon capture for enhanced recovery since the 1970s. However, rising oil prices in the past decade have revived interest in the technology. Facilities like Petra Nova demonstrate its effectiveness in increasing oil production, although the full potential of CO2 injection remains uncertain.
Despite environmental concerns, direct air capture could provide the necessary CO2 for enhanced oil recovery. By capturing and storing CO2, oil companies potentially reduce greenhouse gas emissions while continuing their core operations. The survival of federal incentives for direct air capture remains uncertain, but oil companies’ support suggests they may continue to play a role in the future.
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