(Reuters) -Top U.S. oilfield services provider SLB said on Wednesday it would combine its carbon capture business with Norway's Aker Carbon Capture to accelerate the deployment of carbon capture technologies.
SLB will pay 4.12 billion Norwegian crowns ($379.67 million) in cash for Aker Carbon Capture Holding AS (ACCH), which holds the business of the carbon capture technology provider.
The U.S. company, which will own 80% of the combined business, may also make additional payments of up to 1.36 billion Norwegian crowns ($125.33 million) over the next three years based on the performance of the business.
"We are excited to create this business with ACC (Aker) to accelerate the deployment of carbon capture technologies that will shift the economics of carbon capture across high-emitting industrial sectors," said SLB CEO Olivier Le Peuch.
SLB in its previous earnings call had said it was participating in over $400 million worth of carbon capture and storage tenders worldwide.
"The combination...is expected to facilitate the industrialization of carbon capture processes and accelerate the deployment and scale of CCUS solutions," said James West, analyst at Evercore ISI.
The combined portfolios could drive synergies and help reduce costs of carbon capture, "which is a significant barrier to widespread adoption and often accounts for 50% to 70% of the total spend of a CCUS project."
ACCH will pay $50 million to purchase SLB's carbon capture business, Aker said in a separate statement.
Aker Carbon Capture has a technology to enable carbon emission reductions in hard-to-abate sectors such as waste incineration, bioenergy, cement and gas-to-power.
($1 = 10.8515 Norwegian crowns)