Shell inks supply deal to buy more bio-jet from Neste

London — Shell and Neste have entered into new supply agreement for sustainable aviation fuel, or SAF, which will "significantly" increase the availability of SAF for the aviation industry, the companies said Sept. 23.

Neste, the world's largest producer of renewable diesel, said the supply agreement will come into effect in October but gave no details of the volumes involved.

SAF is produced from 100% sustainable waste and residue raw materials and is capable of reducing greenhouse gas emissions up to 80% compared to fossil fuels.

"Shell Aviation aims to reduce the carbon intensity of the fuels we sell which includes selling more lower-carbon fuels like sustainable aviation fuel, over time," Shell Aviation president Anna Mascolo said in the statement.

The deal comes a month after BP announced a similar deal with Neste to supply its airline customers with five times more SAF in 2020 and 2021 than in 2019.

Neste also supplies SAF to Lufthansa and KLM as a blend with fossil jet fuel.

In the US and Europe, Neste's sustainable aviation fuel capacity is currently 100,000 mt. The company plans to produce over 1 million tons of sustainable aviation fuel by 2022 with the planned expansion of its Singapore bio-refinery.