1PointFive, a carbon capture, utilization, and sequestration (CCUS) unit of Occidental Petroleum (NASDAQ:OXY), has announced a significant agreement with Microsoft Corp (NASDAQ:MSFT) to sell 500,000 metric tons of carbon dioxide removal (CDR) credits over six years.

This agreement supports Microsoft's carbon removal strategy and marks the largest single purchase of CDR credits enabled by Direct Air Capture (DAC) to date.

The CDR credits for Microsoft will be facilitated by STRATOS, 1PointFive's first industrial-scale DAC facility currently under construction in Texas.

Microsoft, committed to becoming carbon negative by 2030, will have the captured carbon dioxide (CO2) securely stored through subsurface saline sequestration, ensuring it is not used for oil and gas production.

Brian Marrs, Senior Director for Carbon Removal and Energy at Microsoft, noted, "We're very pleased to announce this deal with 1PointFive, a pioneer in the Direct Air Capture space, which is building the largest DAC project worldwide. To achieve the gigatons of removals needed this century, first-of-a-kind projects like STRATOS are essential to move from pilots to scale. DAC plays an important role in Microsoft's carbon removal portfolio supporting our broader goal of becoming carbon negative by 2030."

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The agreement with 1PointFive highlights the increasing adoption of DAC technology as a viable solution for achieving net-zero emissions.

STRATOS is set to become the largest DAC project globally, providing a transparent and durable way to address emissions, particularly from hard-to-abate industries.

Earlier this year, AT&T Inc (NYSE:T) also agreed to purchase CDR credits from 1PointFive, as part of its commitment to reducing carbon emissions and becoming carbon neutral in its global operations by 2035.

Carbon credits are tradable permits that allow the owner to emit a specified amount of greenhouse gases. Reuters reported that each credit permits the emission of one metric ton of carbon dioxide or its equivalent in other greenhouse gases.

Price Action: OXY shares are trading higher by 0.72% at $61.39 at last check Tuesday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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