Proactive Investors - Exxon Mobil Corporation (NYSE:XOM) said it has agreed to buy a firm with carbon storage operations for US$4.9bn in a bid to accelerate its energy transition business.
The US oil and gas giant confirmed it bought Denbury, an established carbon dioxide sequestration company.
Shares in both companies were seen lower following the announcement of the deal, which gives Exxon ready-made CO2 transportation.
Tax credit breaks in the US for reducing planet-warming gases have sparked a race to build carbon capture sites, although wide-scale adoption remains uncertain due to the costs and challenges involved.
Denbury CEO Chris Kendall said in a statement, quoted in Reuters, that "significant capital and years of work" are required to fully develop its CO2 business, making deep-pocketed Exxon "the ideal partner with extensive resources and capabilities".