The World's Largest Carbon Removal Plant Is Delayed. The Scale Story Is Not.

In the scrublands of Ector County, Texas, about fourteen miles from Odessa, a pair of industrial phases now stands complete. They are meant to do something no facility on Earth has ever done at this scale: pull half a million tonnes of carbon dioxide out of the ambient air every year and bury it more than a mile underground. The plant is called Stratos, and it is about to miss its startup date again.

Stratos is being developed by 1PointFive, a subsidiary of Occidental Petroleum, in a joint venture with BlackRock that has committed 550 million dollars to the project. When fully operational, its design capacity of 500,000 metric tonnes of CO2 per year would make it the largest direct air capture (DAC) facility in the world by a wide margin. For comparison, the current record holder, Climeworks' Mammoth plant in Iceland, is rated at 36,000 tonnes per year. Stratos is roughly fourteen times larger. Phase 1 would contribute 250,000 tonnes of annual capacity; Phase 2, now fully constructed, would add the other 250,000.

That scale is exactly why the carbon removal industry has watched every milestone at Stratos like a launch countdown. And it is why the latest pause, confirmed on Occidental's first-quarter 2026 earnings call, landed with such a thud.

What actually broke

The setback is not about the capture technology. During Phase 1 commissioning, 1PointFive confirmed that the air contactors and the central processing facility performed as expected. Those are the core of the Carbon Engineering liquid solvent process the plant uses: giant fans draw ambient air through contactors where a potassium hydroxide solution absorbs CO2, which is then processed, compressed, and sent underground.

The problem, described by Occidental as an issue with non-process components, surfaced after the core technology had passed its initial tests. The company has not publicly identified the specific component, and no revised startup date has been announced. At the May 6 earnings call, Richard Jackson, then Occidental's senior vice president and chief operating officer, said the company was evaluating the repair timeline and would provide an update the following quarter. Jackson has since become Occidental's president and CEO, succeeding Vicki Hollub on June 1, 2026.

This is not the first schedule shift. Stratos originally targeted commercial operations by mid-2025, then end of 2025, then the second quarter of 2026. The project's total cost has grown along the way, from an initial estimate of 800 million dollars to 1 billion in 2022, and to 1.3 billion following BlackRock's 550 million dollar investment in November 2023, which covered roughly 40 percent of the total.

Stratos is fourteen times larger than the biggest DAC plant running today. The question is no longer whether the technology works, it is whether a first-of-a-kind megaproject can survive its own construction.

Why the scale still matters

Climate models cited by DAC researchers estimate that limiting warming to less than 2 degrees Celsius could require removing roughly 10 billion metric tonnes of CO2 from the atmosphere every year by 2050, rising to 20 billion per year by 2100. Current DAC systems remove only thousands of tonnes annually. The gap between thousands and billions is the entire industry problem, and Stratos is the first serious attempt to start closing it with a single facility.

It is also the first attempt to demonstrate DAC at commercial scale in the United States. Occidental has said it wants to build 100 similar DAC facilities by 2035, with Stratos as the commercial proof point. Whether that ambition survives the current repair depends less on the broken component and more on what the project has already secured: demand, storage, and permits.

The buyers are already signed

Stratos has lined up corporate buyers for its carbon dioxide removal credits years ahead of operations, which is exactly what the DAC business model requires. Without forward contracts, the capital expenditure for capture infrastructure is nearly impossible to justify.

The largest single agreement is with Microsoft, which in July 2024 committed to 500,000 metric tonnes of DAC removal credits over six years, described at the time as the largest DAC credit purchase on record. Amazon signed a ten-year agreement in September 2023 for 250,000 metric tonnes. Airbus agreed in March 2022 to buy 400,000 metric tonnes over four years, at 100,000 tonnes per year, with an option for more. AT&T announced a purchase in March 2024 with undisclosed volume, and Bain and Company signed in January 2026 for 9,000 metric tonnes over three years, its first DAC removal credit purchase.

Those agreements span technology, aviation, telecoms, and consulting, and they remain in place while Occidental works through the repair. The demand signal has not wavered. The hardware just needs to catch up.

Storage and permits are already in hand

One milestone Stratos has fully cleared is underground storage. In April 2025, the U.S. Environmental Protection Agency approved three Class VI injection well permits for the site, the first ever issued in Texas and the first in the country for sequestering CO2 captured by a direct air capture project.

The three wells, near Penwell, Texas, reach roughly 4,400 feet into saline formations. Together they carry a combined permitted storage capacity of 722,000 metric tonnes of CO2 per year, comfortably above Stratos' 500,000-tonne capture design. That gives the site storage headroom as production ramps, and the permits remain valid regardless of the startup schedule. The project is also supported by the 45Q tax incentive for carbon capture and sequestration, which U.S. lawmakers maintained in the One Big Beautiful Bill Act.

What this means for carbon removal

There is a temptation to read any DAC delay as an indictment of the technology. Stratos suggests a more specific lesson: the risk sits in execution, not chemistry. The capture system passed its tests. The component that failed was, by the company's account, not part of the capture process at all. Megaprojects fail in mundane ways, and Stratos is a megaproject with a novel process at its center.

The encouraging reading is that nearly everything that makes DAC commercially hard has been solved at Stratos except the last mile of commissioning. Corporate buyers are committed. Geologic storage is permitted with spare capacity. The joint venture is funded, and Occidental has said the delay does not change its 2026 capital spending range of 5.5 to 5.9 billion dollars. Meanwhile, Occidental is advancing a second DAC facility in South Texas backed by a U.S. Department of Energy grant of up to 650 million dollars and more than 500 million dollars from Adnoc's XRG investment arm.

Stratos will likely still become the world's largest carbon removal plant. The calendar just keeps moving. For an industry that needs to scale a millionfold in twenty-five years, the real test is not whether the first giant plant starts on time. It is whether the second and third ones start faster.