Halliburton CCUS Strategy, 1 NEP Contract with BP, 6 Injection Wells, and a $1 B Capital Plan for 2026 (2025-2026)

Halliburton Commercial Strategy for CCUS and Hydrogen Infrastructure

In 2025, Halliburton solidified its energy transition strategy by concentrating on enabling infrastructure services for carbon capture and hydrogen storage, deliberately avoiding direct investment in capital-intensive hydrogen production. This approach leverages the company’s core competencies in subsurface engineering and well construction to capture value in high-barrier-to-entry service markets, positioning it as a critical “picks and shovels” provider for the decarbonization efforts of major energy producers.

Focus on Subsurface Service Niches

Halliburton‘s commercial activities demonstrate a clear focus on providing integrated services for projects foundational to both blue and green hydrogen. This includes ensuring the permanent storage of CO 2 from blue hydrogen production and developing viable large-scale storage for green hydrogen. This strategic positioning minimizes direct competition with energy producers like Total Energies and technology-pure-plays while maximizing the value of its existing expertise.

• The company’s primary focus is on two critical, high-barrier-to-entry segments: Carbon Capture, Utilization, and Storage (CCUS) and underground hydrogen storage.
• By offering services instead of producing hydrogen, Halliburton reduces its exposure to commodity price volatility and the policy dependency affecting hydrogen producers such as Suncor Energy or Valero.
• This model was validated through the significant contract win for the Northern Endurance Partnership (NEP) CCUS project, demonstrating that its expertise is in high demand for critical decarbonization projects.

Application to New Energy Adjacencies

The company is expanding the application of its core skills into adjacent industrial markets that require low-carbon energy solutions. This shows a forward-thinking approach to growing its addressable market beyond traditional oil and gas services. The partnership with Volta Grid to power data centers, starting in the Middle East, signals a move into new industrial verticals where reliable, lower-carbon power is essential.

• The strategic memorandum of understanding with Kaishan aims to apply Halliburton‘s geothermal and well-management expertise to support green hydrogen production pathways through Enhanced Geothermal Systems (EGS).
• The collaboration with Chevron on intelligent hydraulic fracturing, while not a direct hydrogen initiative, develops underlying automation and data processing technologies applicable to monitoring the integrity of hydrogen storage caverns.
• These partnerships allow Halliburton to engage across the energy transition spectrum without bearing full project development risk, a prudent strategy in a market facing economic and regulatory uncertainty.

Giga-Scale Hydrogen FID in 2025: Global Divergence
In 2025, regions like the US, Europe (France, UK), and Australia are marked with “No giga-scale project FID”, indicating a lack of imminent Final Investment Decisions for massive hydrogen initiatives. Conversely, South America, the Middle East, and parts of Asia (e.g., India, China) show “Possible giga-scale project FID”, positioning them as early leaders in large-scale hydrogen development.

(Source: Strong 2025 Predicted for US Blue Hydrogen)

$1 B Capital Spending Plan, Halliburton Focuses Investment on High-Return Projects

Halliburton is exercising disciplined capital allocation to support its low-carbon strategy, underscored by a planned reduction in spending for 2026. This financial prudence, supported by strong performance in its core business, allows the company to fund strategic initiatives in commercially viable sectors like CCUS without overextending its capital commitments in a nascent market.

Disciplined Capital Allocation

The decision to cut the 2026 capital spending plan signals a clear focus on projects with strong returns and established commercial pathways. This allows the company to weather market uncertainties while investing in its strategic pivot.

• On October 21, 2025, Halliburton announced it would cut its 2026 capital spending plan by 30% to $1 billion, prioritizing financial discipline.
• This reduction is coupled with cost-control measures expected to generate $400 million in annual savings, further strengthening the company’s financial position for targeted investments.
• A strong start to the year, with a combined profit of $1.49 billion for Halliburton and its peers in Q 1 2025, provides the financial stability needed to execute this focused strategy.

Table: Halliburton Financial and Strategic Commitments (2025)

Partnership-Driven Growth, Halliburton Expands Market Access with 3 Key Alliances

Halliburton‘s 2025 activities are defined by a partnership-driven model designed to expand its capabilities and market reach in the low-carbon sector. By forming strategic collaborations, the company integrates its specialized services into broader clean energy ecosystems, reducing direct investment risk while securing access to new revenue streams across the energy transition spectrum, from geothermal power to industrial decarbonization.

Strategic Alliances in New Verticals

Collaborations with technology providers and industrial partners are central to Halliburton‘s plan to apply its core expertise to emerging markets. These alliances serve as a low-risk mechanism for market entry and capability expansion.

• The partnership with Volta Grid, announced in October 2025, marks a strategic entry into the data center power market, initially targeting the Middle East with distributed and lower-carbon energy solutions.
• A memorandum of understanding with Kaishan specifically targets collaboration on Enhanced Geothermal Systems (EGS), green hydrogen, and green ammonia projects, leveraging Halliburton‘s drilling expertise for renewable energy production.
• While focused on its legacy business, the collaboration with Chevron to enable intelligent hydraulic fracturing develops advanced automation and real-time monitoring technologies that are directly transferable to managing and ensuring the integrity of CCUS and hydrogen storage sites.

Table: Halliburton Strategic Partnerships and Commercial Agreements (2025)

UK Hub, Halliburton Geographic Focus Centers on North Sea CCUS

In 2025, Halliburton‘s geographic focus for large-scale, low-carbon projects crystallized in the UK North Sea, driven by its cornerstone contract with the Northern Endurance Partnership. While pre-2025 efforts were more globally diffuse, this project establishes the UK as the primary validation ground for its CCUS service model, a strategy also being pursued by utilities like Dominion Energy in different regions.

North Sea as a Decarbonization Hub

The UK’s supportive policy environment and established industrial clusters make it an ideal location for pioneering large-scale CCUS infrastructure. Halliburton‘s involvement places it at the center of this developing European hub.

• The NEP project, located in the UK North Sea, is set to become the country’s first offshore carbon capture and storage system, serving the heavily industrialized Humber and Teesside regions.
• This single project provides Halliburton with a significant commercial foothold and operational showcase in a key European decarbonization market, validating its service offering for other large-scale projects planned by companies like Iberdrola.
• While the UK is the center for CCUS, the Volta Grid partnership signals a parallel geographic expansion strategy, targeting the Middle East for new energy service applications in the data center market.

Commercial Scale Technology, Halliburton Repurposes Mature Technologies for Hydrogen

Halliburton‘s strategy relies on applying its mature, field-proven oil and gas technologies to the distinct technical challenges of the nascent hydrogen and CCUS sectors. Rather than investing in unproven R&D, the company is adapting its existing suite of well construction, subsurface modeling, and monitoring tools, a pragmatic approach that accelerates market entry and de-risks execution. This contrasts with the strategies of utilities like Next Era, which are investing heavily in new production technologies.

Adapting Proven Tools for New Applications

The key shift in 2025 was the commercial validation of these repurposed technologies through major contract awards. The NEP project serves as a critical proof point that Halliburton‘s existing toolkit is essential for large-scale decarbonization infrastructure.

• The contract for the NEP project requires Halliburton to provide completions, liners, and downhole monitoring services, all of which are core competencies adapted for CO 2 injection and sequestration instead of hydrocarbon production.
• The company is actively marketing advanced completions tools designed to turn salt caverns into viable, safe, and long-term storage sites for hydrogen, directly addressing a key infrastructure bottleneck for the green hydrogen economy.
• This technology transfer from oil and gas to low-carbon applications gives Halliburton a significant competitive advantage, as its tools have been refined over decades of operation in harsh subsurface environments. This is a different path from energy producers like Woodside Energy that are assessing new production project viability.

SWOT Analysis, Halliburton Hydrogen and CCUS Strategy

Halliburton‘s strategic pivot toward enabling infrastructure for the hydrogen economy is validated by its major CCUS contract win in 2025, but it faces intense competition and market dependency risks. The analysis shows a company successfully leveraging its core strengths to build a defensible niche, a model that differs from the integrated approaches of companies like Enel or Eni.

From Strategy to Execution

The period from 2024 to 2025 marked a crucial transition from strategic positioning to commercial execution. The NEP contract win is the most significant event, validating the “picks and shovels” approach and confirming market demand for its specialized services.

Table: SWOT Analysis for Halliburton Hydrogen and CCUS Initiatives

Scenario Modelling: Halliburton’s NEP Execution and Partnership Conversion

The critical factor for Halliburton in the year ahead is the successful execution of the Northern Endurance Partnership project and the conversion of its strategic MOUs into commercial contracts. If the company delivers on the NEP project milestones, it will cement its market leadership in CCUS services, attracting further business as global decarbonization projects accelerate. This execution focus is a common theme among European energy firms like EDF.

Signals to Monitor

Watch for announcements related to project milestones for the NEP wells and any formal contracts emerging from the Kaishan MOU for geothermal-linked hydrogen. These events will signal whether Halliburton can successfully scale its low-carbon business line.

• Progress reports on the drilling and completion of the six NEP injection wells will be the primary indicator of execution capability.
• The “Drilling for Hydrogen 2026” conference may provide a venue for Halliburton to announce new technologies or partnerships related to geologic hydrogen.
• The expansion of the Volta Grid partnership into new regions or industrial applications would confirm the viability of applying its expertise to adjacent markets.

The questions your competitors are already asking

This report covers one angle of Halliburton’s low-carbon commercial strategy. The questions that matter most depend on your work.

• UK North Sea carbon storage project contractors
• SLB carbon capture contracts
• Underground hydrogen storage technology companies
• Oilfield service company capital spending plans 2026

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