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  • hammaad saghir

Frontier Investment Group Signs $53 Million Agreement with Charm Industrial

Image: A Charm Industrial pyrolysis site in Kansas, USA | Credit: Charm Industrial

Many multinational companies and widely-known brands have been part of a $53m transaction to acquire a large quantity of carbon offset credits from

Charm Industrial, a US company specializing in CO2 removals. This is the first significant offtake agreement that has been completed with the help of the

Frontier fund.

Yesterday, the Frontier fund made a pact to give Charm $53 million to utilize their carbon storage technology to draw in 112,000 tonnes of carbon dioxide from the atmosphere between 2024 and 2030 for a $1 billion payment.

This American company specializes in using pyrolysis to convert wood residue into bio-oil and injecting the carbon-rich liquid into underground reservoirs where it solidifies and remains stored for eternity.

The organizations that established Frontier - Stripe, Alphabet (which is owned by Google), Shopify, McKinsey Sustainability, and Meta (which is the parent organization of Facebook) - have all procured carbon credits through the offtake agreement, along with other investors Autodesk, H&M Group, and Workday.

The financing round involves several companies, including Aledade,

Boom Supersonic, Wise, and Zendesk have made investments in the form of CO2 removal credits through Frontier's alliance with Watershed, a climate platform, as stated by the fund.

Charm Industrial commenced operations in 2021 and boasts of being one of the first companies to extract carbon dioxide from the atmosphere successfully and permanently. Their technology pilots have managed to inject more than 6,000 tonnes of CO2 previously present in the air into solid rock formations underground for permanent storage.

Peter Reinhardt, the co-founder and CEO of Charm Industrial, declared that the offtake agreement would allow them to speed up their technology deployment. "This type of offtake agreement lets us move forward faster than we would have been able to," he stated. "Frontier is an incredibly meticulous buyer, testing and testing our limits in all areas, including science, operations, engineering, finance, and our future cost curves."

It has been reported that the Frontier coalition, founded in 2022 with the purpose of increasing corporate demand and funding for start-ups with carbon removal technologies, has facilitated the largest deal in its history. This is an effort to reduce the costs associated with these technologies.

The cost per ton Charm and the buyers agreed on was not revealed; Frontier declared they forecasted expenses to reduce over the six years of the offtake agreement by a minimum of 37 per cent as the technology developed and government subsidies grew.

Founding members of The Frontier fund anticipate that additional contracts with CO2 removal organizations will be revealed at a later date. They emphasize that their technical personnel and a panel of fifty expert specialists in the scientific and technological fields review all candidates for offtake agreements to guarantee the reliability of the CO2 extraction procedures.

Nan Ransohoff, who is in charge of climate at Stripe and is also a part of Frontier's founder advisory board, praised the progress Charm Industrial has made since it started in 2021. "Charm Industrial has gone from an idea to successfully taking out thousands of tons of CO2 in merely three years," she said. "They have set up an achievable route to carbon elimination with both high capacity and low expense and have set a standard in terms of carrying out their plans swiftly and precisely."

Microsoft and Denmark's Ortsed signed a massive carbon removal offtake agreement this week. The 11-year contract will enable Microsoft to access 2.76 million carbon removal credits. The two companies have marked the accord as one of the largest of its kind in the world. The agreement will also support deploying two biomass energy with carbon capture and storage projects.

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