BBF and Vibra, will produce green aviation fuel.

Vibra

The refinery in Manaus will be the first in the country to use renewable sources for the product and should be ready in 2025

SÃO PAULO - Fuel distributor Vibra (formerly BR Distribuidora) and Brasil Biofuels (BBF) announced on Wednesday that BBF's biorefinery to be built in Manaus will produce sustainable aviation fuel, known as SAF, mainly from palm oil.

It is estimated that the plant will be operational by 2025 and will cost R$2 billion to complete.

This aviation fuel from renewable sources is currently only produced in Europe and the United States, and strong growth in demand from airlines is projected for the coming years as a result of corporate strategies to neutralize carbon emissions.

BBF is a palm oil producer and operator of 18 thermoelectric plants in the North region and had already signed a partnership with Vibra in November 2021 for the plant to be dedicated to the production of HVO (hydrotreated vegetable oil), the so-called green biodiesel.

According to Milton Steagall, president of BBF, after Vibra was approached by airlines about the feasibility of producing SAF at Brasil, the palm oil producer decided to invest in adaptations to its project so that it could also refine SAF in addition to HVO. The total investment in the refinery, previously projected at R$1.8 billion, now stands at R$2 billion to be contributed by BBF.

Vibra has contracted all the production of the future refinery in a five-year contract, extendable for another five years, and will distribute and commercialize the products.

- We consulted the technologies available today in the world (for the production of SAF) and we will make an investment for the implementation. We can make SAF, green biodiesel, or both. The process will be verticalized, the fuel will be produced mainly with the palm oil that we already produce, which reduces risks - says Steagall.

The company has palm plantations in Pará and Roraima. The refinery will be supplied primarily by oil coming from the company's facilities in São João da Baliza (RR).

Production of 500 thousand cubic meters per year

The BBF plant will be located in the Manaus Free Trade Zone and will have a production capacity of 500 thousand cubic meters of fuel per year. The proportion of SAF and green biodiesel to be produced at the site will be established by Vibra according to the demand for the products.

Both the green biodiesel and the plant's SAF will be "drop-in", that is, they can be mixed with fossil fuels and replace, partially or entirely, traditional diesel and aviation kerosene (QAV) without the need for adaptations.

According to Wilson Ferreira Junior, president of Vibra, the company's idea is to ensure that the Brazilian SAF is competitive with the alternative fuel produced internationally, although the initial price tends to be higher than aviation kerosene.

The current challenge for SAF is, above all, gaining scale. Today, SAF is only produced in Europe and the United States and accounts for 0.2% of jet fuel worldwide, according to projections by Latam, Latin America's largest airline.

Higher price

The price of SAF is up to six times that of traditional aviation kerosene. Latam announced last week that it is committed to using up to 5% SAF in its planes by 2030.

- We are the volume taker of the entire plant and the strategy is scalable, it depends mainly on the adoption (of SAF and green biodiesel) by the economic agents around this (sustainable) choice - says Ferreira Júnior. The plant will be able to increase supply if necessary.

The plant's fuel, says the executive, "has unique efficiency characteristics" and will be cheaper than that produced in Europe.

- Biofuel in Europe is much more expensive. There, the awareness is that if we need to decarbonize the world, we need to stimulate supply and, as we gain scale, these alternatives drop in price. At Brasil, our starting price will be lower than foreign prices - says the executive.

According to Vibra's president, the production of SAF will be intended mainly for the domestic market, but the company may also export the product if there is demand.

As a regulatory matter, aircraft manufacturers today limit the amount of SAF in the fuel tanks of next-generation aircraft to 50 percent, but giants like Boeing and Airbus have already announced their goal of certifying their equipment so that they can operate, by 2030, with up to 100 percent SAF in the tanks.

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