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26 Apr 2022 | 17:04 UTC
Highlights
JetBlue adds another California SAF supply agreement
World Energy, Air Products team up to increase SAF supply
California output to grow with World Energy expansion
California-based renewable fuels company Aemetis signed an offtake agreement with JetBlue to deliver 125 million gallons of sustainable aviation fuel to its operations at San Francisco and other California airports for ten years beginning in 2025, the company said in an April 26 statement.
The blended sustainable aviation fuel to be supplied under this agreement is 40% SAF and 60% Petroleum Jet A to meet international blending standards, according to the statement.
The SAF is expected to be produced by the Aemetis renewable jet/diesel plant under development on a 125 acre former US Army ammunition production plant site in Riverbank, California.
JetBlue already has in place SAF offtake agreements with other suppliers -- including California's World Energy -- which is undergoing production expansion to meet growing demand for the cleaner fuel for the hard-to-decarbonize aviation industry, particularly in California, where the state's Low Carbon Fuel Standard credits make it more lucrative to producer lower carbon fuels.
So far in Q2 2022, Platts assessments show US West Coast SAF with both state and federal credits is selling at $7.57/gal, compared with the average annual price of $6.13/gal in 2021.
JetBlue signed a three year SAF offtake agreement with World Energy in 2020 for 1.5 million gal/year as well as an agreement with Finland's Neste in 2020.
World Energy and Air Products, a major supplier of hydrogen and other industrial gases to refineries and other manufacturing facilities, said on April 22 they would build a $2 billion expansion project at World Energy's facility in Paramount, California, which started producing SAF in 2018.
"The long-term, take-or-pay agreement with World Energy includes Air Products' construction and ownership of a new hydrogen plant to be operated by Air Products and renewable fuels manufacturing facilities to be operated by World Energy," according to a statement released by Air Products.
When completed in 2025, the site's SAF production capacity will rise to 340 million gallons/year, up from the 35 million gal/year currently, and expand earlier expansion plans which would have capacity rising to 240 million gal/year.
Air Products, as part of the agreement, extended its Southern California hydrogen pipeline to supply World Energy with hydrogen, as well as "further increase supply reliability for all Air Products' hydrogen pipeline network customers on Southern California," the statement said.
The expansion also gives Air Products the ability to provide at some future date low-or-zero hydrogen to its customers.
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