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Sustainable Aviation Fuel

VARO to invest US$600M in SAF production in Rotterdam

VARO to invest US$600M in SAF production in Rotterdam
VARO is investing US$600 million in the construction of a large-scale sustainable aviation fuel (SAF) facility at its Gunvor Energy Rotterdam site (image courtesy VARO).

Switzerland-headed VARO Energy Marketing AG (VARO) has announced that it is investing US$600 million in the construction of a large-scale sustainable aviation fuel (SAF) manufacturing facility at the Gunvor Energy Rotterdam site in the Netherlands.

Aviation is a vital part of the global economy, connecting people and businesses around the world. But the industry is also one of the fastest-growing sources of greenhouse gas (GHG) emissions.

According to the International Energy Agency (IEA), European jet fuel demand is set to grow by more than 20 percent over the next five years.

Through this investment, VARO is supporting the aviation sector’s decarbonization by manufacturing the SAF that airlines need to meet their targets.

This is at the heart of the ‘Customer Lighthouses’ which have been established by VARO to support customers in the ‘hardest to abate’ industries, such as aviation, in their energy transition.

The first of these was announced with Lufthansa and VARO in February 2023.

Commence production in 2026

Located in Rotterdam, the Netherlands at the centre of one of the world’s major aviation hubs, VARO’s new SAF manufacturing facility will be well-positioned to meet this demand growth.

As well as benefiting from close proximity to major markets the facility is also located alongside port infrastructure, wastewater treatment, as well as existing road, rail, and pipelines, enabling SAF production and distribution.

The 100 percent VARO-owned Gunvor Energy Rotterdam facility features a world-class pretreatment unit, guaranteeing renewable feedstock flexibility and production optimization capability.

The facility will have a total feedstock capacity of 350,000 tonnes per annum, with an SAF production capacity of 245,000 tpa alongside a mixture of bio-naphtha and bio-propane.

Made from waste and renewable biomass sources, SAF is a viable and scalable low-carbon solution for the aviation sector.

This investment by VARO will provide more airline customers with access to SAF, which can be used in the current generation of aircraft and utilizes the current fuelling infrastructure.

SAF production at Gunvor Energy Rotterdam is expected to commence by Q4 2026, enabling VARO to contribute to the significant growth in European SAF demand expected in the coming years.

In a scenario of European SAF demand hitting 3.5 million tonnes per annum, this manufacturing facility alone could provide up to 7 percent of the EU’s 2030 mandated SAF target of 5 percent by 2030.

This US$600 million investment strengthens our leading position in biofuels in Europe by adding SAF production to our portfolio of solutions and will provide our airline customers with an important route to decarbonization. With the potential to produce around 245,000 tpa of SAF when it comes onstream in 2026, this new manufacturing facility alone will provide up to 7 percent of the EU’s 2030 SAF target, said Dev Sanyal, CEO of VARO.

Strategic growth pillar

SAF is part of VARO’s biofuels business, one of the company’s five strategic growth pillars under its ONE VARO Transformation strategy alongside biomethane and bio-LNG; hydrogen; e-mobility; and carbon removals.

These five pillars play to VARO’s traditional strengths while offering some of the most attractive low-carbon growth potential offered by the energy transition.

The development of a large-scale SAF manufacturing facility in Rotterdam, at the centre of one of Europe’s most significant aviation hubs, is an important milestone in the development of the ONE VARO Transformation strategy.I would like to express my appreciation to Gunvor for the excellent cooperation and we look forward to working with them, ended Dev Sanyal.

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