Saudi Aramco DAC Strategy: $1.5 B Larsen & Toubro Deal, 9 Mtpa Jubail Hub, and Siemens Energy Pilot (2025)

DAC Project Adoption, Saudi Aramco Pilots vs. Commercial Scale CCUS

In 2025, Saudi Aramco‘s strategy reveals a deliberate separation between the immediate, large-scale deployment of proven point-source Carbon Capture, Utilization, and Storage (CCUS) and the foundational, small-scale piloting of nascent Direct Air Capture (DAC) technology, a division driven by current cost and maturity gaps.

• The company’s commitment to commercially ready technology is demonstrated by the advancement of the massive Jubail CCUS Hub. This project, targeting the capture of 9 million metric tons of CO₂ per year by 2027 from industrial point sources, represents a significant investment in immediate emissions mitigation.
• In stark contrast, Aramco’s primary DAC initiative in 2025 was the launch of a test unit in Dhahran with a capture capacity of only 12 tons per year. This highlights that for DAC, the current focus is not on volume but on research and development.
• The $1.5 billion contract awarded to Larsen & Toubro in February 2025 for CO₂ processing facilities at Jubail solidified the execution of its CCUS plan, moving it from ambition to construction. This differs from the 2021-2024 period, which was characterized by planning and partnership formation.
• The DAC pilot, developed with Siemens Energy, is a forward-looking R&D platform designed to test novel capture materials against Saudi Arabia’s harsh climate. This positions Aramco to develop proprietary technology and de-risk future investments, rather than achieving significant carbon removal today.

DAC VC Funding Sees Sharp Decline Post-2022 Peak
VC investment in Direct Air Capture (DAC) technology shows extreme volatility, peaking at $826.4M in 2022 before dropping to $99.2M by 2025. This significant decline in capital, despite a preceding rise in deal count (34 in 2024), signals a challenging and cautious funding landscape.

Market Volatility Highlights DAC’s Unresolved Commercial Hurdles
The sharp drop in DAC capital in 2025, following a peak in deal count in 2024, indicates a market where many smaller deals are not translating into sustained large-scale investment. This suggests critical challenges in technology maturity, high CAPEX, or a lack of clear commercial pathways, deterring significant follow-on capital.

(Source: GCV — via Aramco Carbon Capture 2025, 9M Ton SLB Hub)

$1.5 B in Contracts, Saudi Aramco Investment in Carbon Capture Infrastructure

In 2025, Saudi Aramco’s capital allocation for carbon capture prioritized building physical infrastructure for point-source emissions, while using its venture arm to secure access to future DAC technologies at a fraction of the cost.

• The single largest financial commitment in 2025 was the $1.5 billion contract to Larsen & Toubro for the Jubail CCUS project. This expenditure is directed at tangible steel, building the large-scale processing and transportation backbone required for a national carbon management network.
• Aramco’s venture capital arm, Aramco Ventures, pursued a parallel strategy by investing in next-generation DAC companies. It led a $30 million Series A funding round for U.S.-based startup Spiritus and participated in a seed round for German startup Ucaneo.
• This dual-investment approach is strategic. The large infrastructure contract de-risks the logistics of CO₂ handling at scale, while the smaller venture investments purchase options on disruptive technologies aiming to drive DAC costs below the critical $100 per ton threshold.

Table: Saudi Aramco 2025 Carbon Capture Investments and Contracts

Global Carbon Capture Market Poised for Nearly 4x Growth by 2034
The Carbon Capture and Sequestration (CCS) market is projected for robust growth, from $4.51 billion in 2025 to nearly $20 billion by 2034, exhibiting an 18.03% CAGR. This indicates accelerating global investment and scaling of decarbonization technologies.

(Source: FORTUNE BUSINESS INSIGHTS — via Saudi Aramco Carbon Capture 2025, $1.5B Larsen & Toubro)

Saudi Aramco 4 Key Carbon Capture Partnerships (2025)

Aramco’s 2025 partnerships display a portfolio approach, aligning with industrial giants for large-scale CCUS execution and with agile startups for next-generation DAC innovation.

• The collaboration with Siemens Energy, formalized with the launch of the DAC test unit in March 2025, is fundamentally a technology co-development and validation partnership. Its goal is to create capture solutions optimized for high-temperature, arid environments.
• For the Jubail CCUS Hub, Aramco is working with industrial-scale partners like SLB and Linde. This alliance is focused on project execution, combining SLB’s subsurface expertise for storage with Linde’s proficiency in gas processing and transport.
• Through Aramco Ventures, the company established partnerships with DAC startups Spiritus and Ucaneo. These are technology-scouting alliances designed to gain early access to potentially cost-disruptive solutions and monitor the competitive technology field.
• An existing Memorandum of Understanding (Mo U) with Rondo to explore heat battery technology for industrial decarbonization complements the CCUS strategy by addressing emissions from thermal processes, which could be integrated with future capture projects.

Table: Saudi Aramco Key Carbon Capture Partnerships Active in 2025

Saudi Arabia Focus, Saudi Aramco’s Dual Carbon Capture Strategy

In 2025, Saudi Aramco concentrated its physical carbon capture infrastructure development within Saudi Arabia, specifically at the Dhahran and Jubail industrial centers, while using its global venture arm to source DAC innovation from key technology hubs in Germany and the United States.

• The geographic anchors of Aramco’s domestic strategy are the Eastern Province industrial hubs. The Jubail CCUS Hub and the Dhahran DAC pilot are sited to directly address emissions from its core operational footprint and support national industrial decarbonization.
• This domestic infrastructure build-out is critical for achieving Saudi Arabia’s national target to capture and store 44 million tons of CO₂ annually by 2035. The Jubail Hub represents the first major step toward that goal.
• In contrast, Aramco’s strategy for acquiring next-generation technology is global. Through Aramco Ventures, it invested in Ucaneo in Germany and Spiritus in the U.S., tapping into established innovation ecosystems to import and adapt promising DAC solutions.
• This marks a shift from the 2021-2024 period, which was largely defined by domestic planning. 2025 saw the activation of this dual-geography strategy, with concrete construction starting at home and capital being deployed to technology centers abroad.

CCUS at Scale vs. DAC at Pilot, Saudi Aramco Technology Maturity

Saudi Aramco’s 2025 activities clearly delineate the maturity gap between commercially ready point-source CCUS, which is being deployed at megaton scale, and pre-commercial DAC, which remains at the small-scale pilot and R&D stage.

• The decision to advance the Jubail CCUS Hub to a 9 Mtpa capacity confirms that Aramco views the underlying point-source capture technology as mature, reliable, and ready for large-scale industrial deployment with partners like Linde and SLB.
• Conversely, the Dhahran DAC unit’s minuscule 12 tons-per-year capacity confirms the technology is still in the pilot phase. Its primary purpose is not commercial carbon removal but addressing fundamental challenges like material degradation and energy consumption in real-world conditions.
• This cautious, phased approach to DAC is economically justified by its current high costs, reported to be between $400 and $700 per ton of CO₂. This makes large-scale deployment economically unfeasible without significant technology breakthroughs or heavy subsidies.
• Aramco’s investments in startups like Spiritus, which is explicitly targeting a sub-$100 per ton cost, demonstrate an awareness of this economic barrier and a strategy to accelerate DAC’s journey toward commercial viability.

SWOT Analysis, Saudi Aramco Carbon Capture Strategy

Saudi Aramco’s 2025 strategy leverages its immense financial strength and existing infrastructure to build a leadership position in CCUS, but its DAC ambitions face threats from high costs and technological competition, creating an opportunity to become a technology owner through strategic R&D and venture investments.

Table: SWOT Analysis for Saudi Aramco DAC and CCUS Initiatives

Future Scenarios for Saudi Aramco’s 9 Mtpa Jubail Hub

The critical signal to watch in the next 12-24 months is the construction progress on the Jubail CCUS Hub, as its development is the primary enabler for any future, large-scale DAC deployment in the Kingdom.

• If construction milestones for the Jubail Hub, supported by the Larsen & Toubro contract, are met on or ahead of schedule, watch for announcements of a “Phase 2” expansion or site selection for a large-scale DAC plant co-located with this infrastructure. This would signal high confidence in the CO₂ transport and storage network.
• If the Dhahran DAC pilot with Siemens Energy yields positive data on sorbent durability and energy efficiency, watch for Aramco to sanction a larger, pre-commercial pilot (e.g., 1, 000-ton scale), possibly integrating technology from a venture investment like Spiritus. This would confirm it is proceeding down its technology de-risking pathway.
• These could be happening if DAC technology costs, particularly from innovators like Spiritus, show a verifiable path toward the sub-$200 per ton level. The combination of proven, available infrastructure from the Jubail project and a credible, lower DAC cost curve is the necessary trigger for Aramco to shift its DAC strategy from pilot to commercial scale.

The questions your competitors are already asking

This report covers one angle of Saudi Aramco’s carbon capture strategy. The questions that matter most depend on your work.

• Jubail carbon capture hub construction timeline
• Direct air capture cost breakthroughs
• Other oil company carbon capture investments
• Saudi Arabia national carbon capture targets

This report does not answer these. Enki Brief Pro does.

Your question, your angle, your framework. SWOT, PESTL, scenario modelling. The same niche depth, built around the decision your work actually depends on.

Run your first brief in Enki Brief Pro