When Occidental (Oxy) announced its acquisition of direct air capture (DAC) startup Holocene, it didn't splash across headlines like a billion-dollar IPO. But in the world of carbon removal, this deal sent a clear signal: the industry is growing up. What started as a space dominated by scrappy climate tech startups is now entering an era defined by scale, infrastructure, and consolidation.
Founded in 2022, Holocene developed a liquid-based, low-temperature DAC system that uses amino acids to pull CO2 out of the air. Based in Knoxville, Tennessee, the startup made waves in 2024 when it secured a deal with Google to deliver 100,000 tons of carbon removal credits at a record-low price of $100 per ton. That alone would have made headlines. But getting snapped up by one of the biggest names in energy? That's a different level.
>> RELATED: Oxy Acquires Carbon Removal Tech Startup Holocene
Oxy isn't new to carbon removal. In 2023, it shelled out $1.1 billion to acquire Carbon Engineering, whose potassium hydroxide-based DAC process now powers Oxy's STRATOS facility in Texas. STRATOS is on track to become the largest DAC plant in the world, capable of removing 500,000 tons of CO2 per year.
So why add Holocene to the mix?
"The dream to see our liquid, low-temperature DAC technology deployed at scale is that much closer to becoming reality," said Anca Timofte, Holocene's CEO and Co-founder, in a statement after the acquisition.
By bringing Holocene into the fold, Oxy now controls two very different DAC chemistries. Carbon Engineering's system requires high heat, often powered by natural gas. Holocene's approach uses electric heat, which opens the door to using waste heat from data centers or renewable energy sources. It’s not just about hedging bets. It’s about building optionality.
DAC has long been considered a moonshot. But the market is starting to mature, and that means survival now depends on scale, partnerships, and staying power. With more than 140 DAC companies globally, and over $1.4 billion in private capital invested, consolidation was inevitable.
"I expect to see a fair amount of consolidation of the industry in the near term," said **Jason Hochman of the Direct Air Capture Coalition**.
This deal doesn’t just give Oxy more tech—it gives them talent, intellectual property, and credibility. It also signals that carbon removal isn’t just a niche climate play anymore. It’s an emerging industry where oil and gas companies are becoming essential players.
>> In Other News: NovoMOF Raises $5.4 Million to Scale Up Low-Cost Carbon Capture Materials
Holocene's fast rise—just two years from founding to acquisition—also highlights how quickly the space is moving. The startup had only raised around $6 million before being acquired. That kind of leap speaks volumes about the value of their tech and the urgency to scale solutions that work.
DAC at scale isn’t just about big facilities. It’s about integration with storage networks, CO2 buyers, and policy frameworks like the Inflation Reduction Act (IRA). Holocene’s tech offers cost efficiencies and grid compatibility that could make it easier to deploy alongside industrial hubs or clean power sources.
Meanwhile, Oxy’s DAC subsidiary 1PointFive has been busy. Just this month, the EPA granted it permits to sequester CO2 from STRATOS in underground wells —a crucial milestone for long-term carbon storage in the U.S.
This isn’t just a tech story. It’s an economic one. Companies like Microsoft, Stripe, and Google are pouring money into carbon removal credits. But they're also getting choosier about what—and who—they’re willing to pay for.
With Holocene and Carbon Engineering under its belt, Oxy can offer multiple pathways to carbon removal at scale, backed by operational and financial muscle. That’s a value proposition startups simply can’t match alone.
There’s still tension in the narrative. Oxy has pitched DAC as a way to produce "net-zero oil"—using captured CO2 in enhanced oil recovery. For climate advocates, that sounds like a loophole. But others see it as a bridge: an uncomfortable but practical step toward reducing global emissions.
DAC has officially moved beyond experimentation. With tech diversity, big funding, and government support all converging, the carbon removal market is entering a new era. It won’t be smooth. But it will be real.
The acquisition of Holocene shows that carbon removal is no longer about potential—it’s about execution. The companies that can scale, adapt, and integrate will define the next phase of climate innovation. And as of this week, Occidental is making sure it's one of them.
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