Factbox: Asia's sustainable aviation fuel projects and agreements
26/05/2023 11:03
(Recasts, changes slug, updates factbox with Malaysia and India
projects)
By Carman Chew and Trixie Yap
SINGAPORE, May 26 (Reuters) - Malaysian Aviation Group
(MAG) has signed a sustainable aviation fuel (SAF) offtake
agreement with Petronas Dagangan PETR.KL , as part of efforts
to develop the green fuel on a commercial scale in Malaysia, the
two firms said on Friday.
SAF, referring to alternative fuels made from renewable
sources that are used to power aircraft, is crucial for the
aviation sector to reach its net zero goal by 2050, but its
adoption remains in a nascent phase.
Following is a look at other SAF projects and agreements in
the Asia-Pacific region.
INDIA
Indian Oil Corp (IOC) IOC.NS aims to set up a plant by
2026 to produce 87,000 tonnes per year (tpy) of SAF, at a cost
of more than 15 billion rupees, its director for research and
development SSV Ramakumar told Reuters last week.
India plans to mandate the use of 1% SAF for domestic
airlines by 2025, oil minister Hardeep Singh Puri said last
week, in a bid to cut emissions.
SINGAPORE
Singapore Airlines began a one-year SAF pilot programme in
July 2022, working with ExxonMobil XOM.N and Neste NESTE.HE .
The companies blended 1,000 tonnes of neat SAF with jet fuel and
supplied the oil to Singapore Airlines and Scoot flights at
Changi Airport.
Finnish refiner Neste NESTE.HE officially opened a second
1.3 million tpy renewable fuels plant in Singapore last week
with the world's largest capacity to produce SAF.
Shell SHEL.L , however, recently shelved its planned
biofuels project at its Bukom complex in Singapore.
CHINA
On April 6, Airbus AIR.PA and the China National Aviation
Fuel Group (CNAF) signed a memorandum of understanding to
increase production and use of SAF.
Last October, an A320neo Airbus aircraft departed from
Tianjin and landed in Xian using a 5% SAF blend, with SAF
produced locally by Sinopec subsidiary Zhenhai Refining &
Chemical Co (Zhenhai Refining), the China Daily reported.
JAPAN
Eneos Holdings Inc 5020.T agreed to study production of up
to 500 million litres (3.1 million barrels) of SAF and renewable
diesel per year jointly with Australian refiner Ampol ALD.AX .
Japan's top airlines All Nippon Airways (ANA) 9202.T and
Japan Airlines (JAL) 9201.T have expanded their SAF purchases
by adding supplies from trading house Itochu Corp 8001.T and
U.S. producer Raven SR.
Other companies exploring SAF production in Japan include
Mitsubishi Corp 8058.T , Boeing BA.N , and TotalEnergies SE
TTEF.PA .
SAF is set to replace 10%, or 1.34 million kilolitres, of
fuel used by Japanese airline companies by 2030, according to
the Japan Transport and Tourism Research Institute (JTTRI).
PHILIPPINES
Cebu Pacific CEB.PS flew a plane from Singapore to Manila
powered by a 35% SAF blend from Neste in September 2022.
The airline signed a long-term strategic partnership with
Shell Eastern Petroleum to make SAF more widely available for
its fleet via the supply and purchase of SAF in Asia Pacific and
the Middle East, with an initial volume of at least 25
kilotonnes per year.
AUSTRALIA
Qantas Group QAN.AX launched the Sustainable Aviation Fuel
Coalition (SAF Coalition) in collaboration with Australia Post,
KPMG Australia, Macquarie Group, the local arm of Boston
Consulting Group and Woodside Energy on Nov. 11, 2022.
Qantas and Airbus SE AIR.PA will jointly invest A$2
million ($1.34 million) in a biofuel refinery being set up in
Australia's Queensland state that would convert agricultural
by-products into SAF.
The refinery is expected to produce up to 100 million litres
of SAF a year, with construction due to start next year.
This is the first investment from a $200 million fund Qantas
and Airbus set up last June to kick off the SAF industry in
Australia.
The airline expects about 10% of its fuel to come from SAF
by 2030, and 60% by 2050.
Last November, Climate Leaders Coalition members Ampol
ALD.AX , Brisbane Airport, Deloitte, Qantas and Viva Energy
VEA.AX proposed the establishment of an East Coast SAF
corridor in their Scope 3 Roadmap.
Australia's first Jet Zero-style council, modelled on the
eponymous government-industry partnership for SAF production in
Britain, is expected to hold its first meeting this financial
year ending in June 2023, said a spokesperson from the
Department of Infrastructure, Transport, Regional Development,
Communications and the Arts.
The council will complement the Aviation White Paper, which
is expected to wrap up early 2024.
(Reporting by Carman Chew and Trixie Yap; Editing by Florence
Tan and Jason Neely)
((trixie.yap@thomsonreuters.com;
carman.chew@thomsonreuters.com))