Exxon Mobil will buy the carbon solutions company, Denbury, for nearly $5 billion.
Reuters reports that “the deal builds out Exxon's plan to develop an emerging market that makes money from reducing its own and others' greenhouse gases.”
Denbury uses carbon dioxide to obtain oil from wells that have otherwise dried up. As stated on the National Energy Technology Laboratory’s website, “Carbon dioxide enhanced oil recovery (CO2 EOR) is a technique used to recover oil, typically from mature fields that have ceased being productive through traditional primary and secondary recovery methods.” The technology in place to encourage this type of retrieval is what has attracted oil companies that are interested in carbon capturing.
Although Denbury is providing the technology, Exxon has already begun making deals and forming partnerships to capture, transport and store carbon from manufacturing plants which produce carbon dioxide as a byproduct. Some of the companies include fertilizer maker CF Industries, industrial gas company Linde and steel producer Nucor.
According to Reuters, the $4.9 billion deal will give Exxon access to the largest carbon dioxide pipeline in the country, further expanding its carbon capturing plans. As the largest U.S. oil producer, Exxon has a target date of 2050 to cut its operational emissions with plans to develop technologies such as carbon capture and storage, hydrogen power and biofuels from algae.
“Bringing together the capabilities of what we’ve been building is going to create a more compelling value proposition,” said Dan Ammann, president of Exxon’s low-carbon solutions business, according to the Wall Street Journal. “It’s going to accelerate the profitable growth of the business and accelerate decarbonization, and that will help the U.S. overall and accelerate the world’s path to net zero.”