Gevo and SAS amend sustainable aviation fuel off-take deal
US-headed advanced renewable fuel and biochemical platform technology developer Gevo Inc. has announced that it and air carrier Scandinavian Airlines System (SAS) have signed an amendment to increase SAS’s minimum purchase obligation to purchase sustainable aviation fuel (SAF) to 5 million (US) gallons (≈ 18.9 million litres) per annum.
Gevo and SAS signed the original fuel sales agreement in October 2019. With the finalization of this amendment to the fuel sales agreement, Gevo expects to supply SAS with sustainable aviation fuel (SAF) beginning in 2024 from Gevo’s Net-Zero 2 Project for use and distribution in low carbon fuel regions of the United States (US), subject to certain conditions precedent.
SAS has an ambitious goal in reducing its’ absolute climate affecting emissions by 25 percent from 2005 levels by 2025. This increase of Gevo SAF will help us to reach at least 20 percent of the SAF needed to reach our emission reductions goal. SAS chooses partners like Gevo that have the vision and ambition to support the aviation industry’s transition to net zero-emission, said Lars Andersen Resare, Head of Sustainability, SAS.
According to Gevo, the value of the fuel sales agreement, as amended, is estimated at over US$100 million over the entire term of the agreement inclusive of the related SAF and environmental credits.
Beyond Net-Zero 1
Gevo has introduced the concept of Net Zero Projects. Announced in early 2021, these production facilities are being designed to produce energy-dense liquid hydrocarbons using renewable energy and Gevo’s proprietary technology. The first Net-Zero project, Net-Zero 1, is expected to be built in Lake Preston, South Dakota (SD).
The Net-Zero Projects are being designed to produce liquid hydrocarbons in the form of SAF and renewable gasoline. These fuels, when used for transportation, should have a net-zero greenhouse gas (GHG) footprint as measured across the entire lifecycle, based on the Argonne National Laboratory’s Greenhouse gases, Regulated Emissions, and Energy use in Technologies (GREET) model.
With this amendment, SAS has significantly increased the amount of SAF that it is willing to purchase from Gevo. This amendment is evidence of the strong and growing demand for Gevo’s renewable hydrocarbon products. We expect to ink additional offtake agreements later this year. SAS have a vision and plan that they are executing, even in spite of the global pandemic. This additional volume will help Gevo grow its business and hopefully accelerate making real Gevo’s Net-Zero 2 plant, said Dr Patrick R. Gruber, CEO of Gevo.