JPMorganChase and 1PointFive, the Direct Air Capture (DAC)-focused subsidiary of energy giant Occidental (Oxy) announced a new agreement, with the bank purchasing 50,000 metric tons of carbon dioxide removal (CDR) credits over 10 years from a new DAC plant in Texas.

According to the companies, the new agreement forms part of JPMorganChase’s strategy to address operational emissions, in addition to helping to establish a market for high-quality and durable carbon removal credits. The transaction forms the latest in a series of carbon removal agreements by the bank, including a 450,000 ton deal announced last month with CDR project developer CO280.

Under the new agreement, the CDR credits for JPMorganChase will be produced from STRATOS, 1PointFive’s first DAC facility in Texas, which is expected to start up this year.

Taylor Wright, Head of Operational Decarbonization, JPMorganChase, said:

“With STRATOS set to be commercially operational this year, JPMorganChase is proud to support large scale deployment of DAC technology. This offtake agreement builds on our diverse, high-quality portfolio of carbon removal projects to address our unabated operational emissions and aligns with our ongoing efforts to help scale the growth and development of carbon removal technologies.”

DAC technology, listed by the IEA as a key carbon removal option in the transition to a net-zero energy system, extracts CO2 directly from the atmosphere for use as a raw material or permanently removed when combined with storage.

Oxy has invested significantly in direct air capture, including through the $1.1 billion acquisition in 2023 of DAC technology company Carbon Engineering, and the acquisition this year of DAC startup Holocene. Oxy, through its DAC subsidiary 1PointFive is currently developing a series of carbon removal and sequestration projects in the U.S., including STRATOS in Texas, which it expects to be the largest DAC facility in the world to date, designed to capture 500,000 tonnes of CO2 per year when fully operational. Earlier this year, the company announced that it has been awarded permits by the EPA to sequester CO2 captured from STRATOS in deep underground wells.

Michael Avery, President and General Manager of 1PointFive, said:

“We’re excited to work with JPMorganChase and believe this agreement further demonstrates how leading organizations are integrating Direct Air Capture credits into their portfolios. Momentum from CDR buyers helps us move the technology forward and build infrastructure that creates economic opportunities in the United States.”