Leilac signs DAC MOU for global licence & collaboration agreement with Heirloom

Calix is pleased to announce that Leilac, Calix’s 93% owned subsidiary focusing on decarbonisation of cement and lime, has signed a Memorandum of Understanding (MOU) with Heirloom, a Direct Air Capture (DAC) company.

The partnership between Leilac and Heirloom, whose investors include Bill Gates-backed Breakthrough Energy Ventures, as well as existing Leilac shareholder Carbon Direct Capital Management, Ahren Innovation Capital and Microsoft, brings together two leading climate technologies to provide an innovative and highly efficient approach to atmospheric carbon dioxide removal by DAC.

The MOU outlines the key terms for a global and binding licence and collaboration agreement for the use of Leilac’s kiln technology in Heirloom’s DAC solution.

In welcoming the partnership, Calix Managing Director and CEO, Phil Hodgson said, “Heirloom is a sophisticated and innovative Direct Air Capture company, and their partnership with Leilac represents a new application of Calix’s core platform technology to address the global challenge of excess atmospheric CO2 levels.”

“The licence and collaboration agreement outlined in the MOU is the latest example of Calix’s commercialisation strategy, designed to deliver the greatest positive impact at the greatest speed.” 

Leilac CEO, Daniel Rennie said, “Leilac is delighted to announce our partnership with Heirloom. Leilac and Heirloom are on a shared mission to help address global CO2 emissions. Together, our technologies can deliver an efficient and scalable approach to directly removing excess carbon dioxide from our atmosphere.”

Heirloom CEO, Shashank Samala agreed, “We’re incredibly excited about incorporating Leilac’s world-leading electric kiln technology into our Direct Air Capture facilities because it will accelerate our efforts to capture 1 billion tons of CO2 from the atmosphere by 2035 owing to its highly modular and energy-efficient design.”

Heirloom & Leilac’s unique approach to DAC

Heirloom’s DAC solution harnesses limestone, one of the world’s most abundant minerals, to provide a fast and low-cost path to permanent CO2 removal. With a cost of approximately US$10-$50/tonne, limestone is inexpensive and easy to source. Combined with highly modular and easy to manufacture facilities, Heirloom’s solution is designed to scale quickly to meet the urgency of climate action.

Leilac’s calcination technology efficiently separates and captures carbon dioxide from limestone to produce decarbonised lime. Its unique indirect heating approach requires no additional chemicals or processes and can be directly powered by renewable electricity. By keeping the process CO2 emissions pure, Leilac’s technology removes the need to separate gases from gases, enabling it to target the lowest cost solution for the capture of CO2 from limestone.

Heirloom’s DAC technology uses lime in a novel carbonation process to directly capture CO2 from the air and form limestone. This process accelerates the natural binding of CO2 and lime from a period of years to just three days.

After binding and removing CO2 from the air, the reformed limestone is fed back into the renewably powered Leilac kiln, where the CO2 is separated and captured, and the cycle begins again.

The CO2 removed from the air will be mineralised, where it is bound to rocks or other materials, or injected underground into existing natural geological structures, where it remains safely and permanently stored.

The integrated Heirloom and Leilac DAC solution will be 100% renewably powered to deliver the maximum net reduction of atmospheric carbon dioxide.

The licence agreement

Under the terms of the proposed global and binding perpetual licence agreement set out in the MOU, Leilac will receive a royalty based on the value of the CO2 captured with the technology.

The royalty will:

  1. Have a floor price set at the greater of US$3/tonne of CO2 separated in a Leilac kiln, or 3.5% of the prevailing CO2 price for lime decarbonisation; and
  2. Have a variable price based upon the total volume of CO2 capture capacity installed and the prevailing CO2 price for lime decarbonisation, less the amortised cost of capital of the Leilac kiln per tonne of CO2 separated.

It is expected that the floor price will be the initial royalty rate. As the technology application develops in scale and maturity, the costs of deployment are expected to fall correspondingly and cause the variable price to become the prevailing future royalty rate.

As part of the licence and collaboration agreement, Heirloom will contribute US$3m towards mutually agreed upon DAC and lime related research and development activities. Leilac will retain all IP relevant to its technology.

Why Direct Air Capture?

Industrial decarbonisation is vital to achieving net zero emissions by 2050 and avoiding the most catastrophic effects of climate change. However, urgently decarbonising our industries will not be enough to achieve global climate goals. The excess carbon dioxide already in the atmosphere must also be mitigated.

The Intergovernmental Panel on Climate Change projects that carbon dioxide removal in the order of 1-10 billion tonnes of CO2 per year could mitigate residual emissions and, in most scenarios, achieve net negative emissions to return global warming to 1.5°C, following a peak.

Modular, scalable and low-cost DAC technology, paired with geological carbon storage, can offer a path to removing ambient CO2 at the scale.

Applying Leilac’s industrial decarbonisation technology to DAC

Leilac’s decarbonisation technology was developed for, and in partnership with, the cement and lime industries. It provides an efficient solution for the separation and abatement of unavoidable process emissions released in the production of cement and lime and is designed to be powered by renewable energy sources and clean alternative fuels.

Heirloom will apply the same core Leilac kiln technology for direct air capture of CO2 emissions from the atmosphere, leveraging eight years of significant investment from the European Union and cement and lime industries to support and progress the DAC industry.

Leilac’s technology is proven at pilot scale, including through its pilot plant, Leilac-1, and three smaller electric units. In operation since 2019, Leilac-1 has a capture capacity of 25,000 tonnes of CO2 per year and is currently the largest carbon capture installation for cement in the world, outside China. Currently, Leilac’s proven capacity is more than double the current combined capture capacity of all DAC facilities globally.

Leilac-2, a demonstration plant that will be retrofitted to Heidelberg Materials’ operation plant in Hannover, Germany with a capture capacity of 100,000 tonnes of CO2 per year is due to open in 2024. Multiple engineering studies are in progression for full-scale installations of the Leilac technology at cement plants with capture capacities of ~1 million tpa of CO2.

The partnership will also further accelerate development of Leilac’s decarbonisation solutions for industrial emissions in cement and lime, helping to pave the way for full scale industrial electrification and CO2 abatement.

Mr Rennie continued, “The collaborative and cooperative approach outlined in this agreement aims to accelerate the learning, synergies and steps to scaling that are needed to achieve our global climate ambitions and commitments. We are very excited to see the results we can achieve together.”

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