Occidental Petroleum and a group of partners is considering building a new $810 million facility near Penwell that could help reduce the area’s carbon footprint and the Odessa Development Corporation hopes to seal the deal with a $2.4 million grant.
Last month, Occidental Petroleum told investors they plan to spend up to $1 billion on a facility in the Permian Basin that could remove 500,000 tons of carbon dioxide directly from the air, in what would be the world’s largest direct air capture project. According to a Houston Chronicle article, the facility would join 70 direct air capture facilities that are expected to become active by 2035.
On Wednesday, Tom Manskey, director of economic development for the Odessa Chamber of Commerce, told the ODC that Occidental Petroleum and its partners, going by the name of 1PointFive, had applied for a $2.4 million grant that would be paid out over five years.
The company indicated it would like to build a new $810 million facility that would capture carbon dioxide directly from the atmosphere, solidify it, store it and sell it, Manskey said. The company anticipates hiring a total of 125 employees over a five-year period resulting in a payroll nearing $23 million at the end of that time period.
According to the company’s website, the Permian Basin facility is currently in “front-end engineering and development” and will be operational by late 2024.
The company’s mission is to curb global temperature rise to 1.5 degrees Celsius by 2050, according to the website.
ODC member Chris Crow pointed out that under the matrix the ODC normally uses to determine how much a company should get in incentives, the company had actually qualified for more than $15 million in incentives.
All of the ODC members agreed the company’s request was reasonable and the proposal was lucrative. As a result, they voted unanimously to recommend approval of the grant to the Odessa City Council, which is expected to take up the matter on Tuesday.
Following the meeting, Manskey said he knows 1PointFive has been considering four states to build such a facility . If the company chooses to build here, the project would likely be among the top 10 investments seen in ODC history and encompass hundreds of acres, he said.
The number of future employees who will be earning a good wage and benefits is significant, but the property taxes generated by the company would be an even bigger boon, Manskey said.
The chamber began working with the company long before he arrived in February, he said.
“We tied up loose ends and got it over the finish line, but it had been recruited, it was already in the pipeline. We’re still working with that group trying to get them to look at some other opportunities here. The consultants that they’ve utilized, they’ve been good to work with. They’ve been in town numerous times since I’ve been here,” Manskey said.
Assuming the city council approves the grant, 1PointFive will still need to confirm all of the costs involved in the project before making any final decisions, he said.
However, Manskey said he is “confident” the company will choose to build in Ector County and have identified a location near the future site of the $8 billion Nacero gasoline plant.
“I think there were issues that made us a favorite all along. One of the big members of this partnership already has a presence in the Basin, they know the skill level of the labor force and the capabilities. There are also some things like, a lot of carbon is produced out here so there’s a lot they can capture. They know the climate. You know, geographically we don’t have a huge issue with tornadoes in and around Odessa,” Manskey said.
