ExxonMobil and Calpine Forge CO₂ Transportation and Storage Agreement to Advance Low-Carbon Power Generation in Texas
Exxon Mobil Corporation (NYSE: XOM) has announced a landmark agreement with Calpine Corporation, the largest producer of electricity from natural gas in the United States, to transport and permanently store up to 2 million metric tons of carbon dioxide (CO₂) annually. This partnership represents a major step in Calpine’s Baytown Carbon Capture and Storage (CCS) Project, which aims to reduce the carbon footprint of its Baytown Energy Center, a natural gas-fired cogeneration facility located just outside Houston, Texas.
The Baytown Energy Center plays a critical role in delivering both electricity and steam to customers across the Texas Gulf Coast. The integration of carbon capture at this site is designed to enable the facility to continue providing a 24/7 supply of reliable electricity—while significantly lowering CO₂ emissions. As part of the agreement, ExxonMobil will transport the captured carbon dioxide using its expansive pipeline network and permanently sequester it in secure geological formations, helping to decarbonize one of the country’s most vital industrial corridors.
A Significant Milestone for ExxonMobil’s CCS Strategy
This collaboration marks ExxonMobil’s sixth commercial customer for carbon capture and storage and brings the company’s total contracted CO₂ volume to approximately 16 million metric tons per annum (MTA). That figure is a testament to the growing demand for proven, large-scale decarbonization solutions across multiple industries.
The captured emissions from Calpine’s Baytown facility will be funneled into ExxonMobil’s proprietary CO₂ pipeline system—the largest of its kind globally. Strategically located along the U.S. Gulf Coast, this pipeline infrastructure connects industrial emitters to secure storage sites. It also supports both enhanced oil recovery (EOR) operations and dedicated geologic sequestration, offering flexible options for different customer needs.
“We’re thrilled to work with Calpine on this project that supports American energy security, enhances industrial competitiveness, and leverages America’s abundant low-cost natural gas resources,” said Barry Engle, President of ExxonMobil Low Carbon Solutions. “This agreement underscores the growing confidence our customers across diverse sectors—including steel, fertilizer, industrial gases, natural gas processing, and now power generation—have in our unique end-to-end CCS system.”
Enabling Clean, Reliable Power for Half a Million Homes
Calpine’s Baytown CCS Project is expected to capture and store carbon emissions equivalent to taking nearly 450,000 cars off the road each year. Once operational, the project will enable the generation of approximately 500 megawatts of low-carbon electricity—enough to power over 500,000 homes in Texas. In addition, the facility will continue supplying steam to nearby industrial operations, further supporting the region’s economic base with cleaner energy inputs.
Engineering design, permitting processes, and other pre-construction development activities are already underway. In parallel, Calpine and its partners anticipate that the project will create a substantial number of construction-related jobs as well as permanent positions once the facility begins commercial operations.
“Calpine is excited to partner with ExxonMobil to achieve this important project milestone,” said Caleb Stephenson, Executive Vice President of Commercial Operations at Calpine. “As the largest U.S. generator of electricity from natural gas, we recognize that natural gas will continue to play a foundational role in the energy mix for decades to come. We believe CCS is one of the most actionable and cost-effective strategies to decarbonize that essential resource while ensuring energy reliability.”
Carbon Capture as a Cornerstone of Energy Transition
Stephenson emphasized that carbon capture and storage is not just a short-term solution but a key pillar of the long-term energy transition. With widespread geologic storage potential, mature natural gas infrastructure, and public-private collaboration, the U.S. is uniquely positioned to lead the global deployment of CCS technologies.
“Our ability to pair low-cost, domestic natural gas with advanced carbon capture solutions and a robust CO₂ storage network creates a unique advantage for U.S. energy resilience, job creation, and global competitiveness,” said Stephenson. “We are encouraged by growing market and policy support for CCS and look forward to continuing our investment in decarbonized power infrastructure.”
Calpine’s broader investment strategy reflects this vision. In addition to the Baytown CCS Project, the company recently acquired the Quail Run Energy Center in the Permian Basin and is actively expanding its generation and storage portfolio nationwide.
Stephenson also expressed appreciation for federal leadership in supporting energy innovation: “We’re grateful to the Trump administration for championing expanded energy and electricity production to power America’s economy, and to the Department of Energy for its longstanding role in advancing power sector and CCS technologies.”
The Path Forward: Policy, Permits, and Power Purchase Agreements
Despite the significant progress to date, the success of the Baytown CCS Project will depend on several external factors. Continued government support in the form of tax incentives, permitting efficiency, and regulatory certainty will be essential for long-term project viability. In parallel, Calpine is working to secure power purchase agreements with customers who value low-carbon electricity, including commercial, industrial, and municipal buyers.
ExxonMobil has been increasingly vocal about the importance of clear regulatory frameworks and market signals to accelerate CCS deployment at scale. The company’s Low Carbon Solutions division has positioned itself as a turnkey provider for emitters seeking to decarbonize without diverting from their core business operations.
“By offering comprehensive, scalable solutions, we are helping industries—from manufacturing to power generation—decarbonize without compromising reliability or economic performance,” said Engle. “This partnership with Calpine is a strong example of how CCS can deliver real, near-term emissions reductions in hard-to-abate sectors.”
Conclusion: Strengthening the Low-Carbon Energy Ecosystem
The agreement between ExxonMobil and Calpine represents a strategic alignment between two energy leaders committed to innovation, sustainability, and infrastructure investment. It also underscores the vital role that CCS can play in achieving national and global climate targets, especially when applied to sectors that are otherwise difficult to decarbonize.
As engineering and permitting activities continue, both companies have expressed confidence in their ability to bring the Baytown CCS Project to fruition and serve as a model for future collaborations. With the U.S. Gulf Coast emerging as a hub for carbon capture development, projects like this are helping to build the foundation for a cleaner, more resilient energy system.
About ExxonMobil
ExxonMobil, one of the largest publicly traded international energy and petrochemical companies, creates solutions that improve quality of life and meet society’s evolving needs.
The corporation’s primary businesses – Upstream, Product Solutions and Low Carbon Solutions – provide products that enable modern life, including energy, chemicals, lubricants, and lower emissions technologies. ExxonMobil holds an industry-leading portfolio of resources, and is one of the largest integrated fuels, lubricants, and chemical companies in the world. ExxonMobil also owns and operates the largest CO2 pipeline network in the United States. In 2021, ExxonMobil announced Scope 1 and 2 greenhouse gas emission-reduction plans for 2030 for operated assets, compared to 2016 levels. The plans are to achieve a 20-30% reduction in corporate-wide greenhouse gas intensity; a 40-50% reduction in greenhouse gas intensity of upstream operations; a 70-80% reduction in corporate-wide methane intensity; and a 60-70% reduction in corporate-wide flaring intensity.