24/11/27
Q&A: AtJ learnings, mandate critical for Australian SAF
Q&A: AtJ learnings, mandate critical for Australian SAF
Sydney, 27 November (Argus) — Australian bioenergy developer Jet Zero has
received strong government backing for its proposed Project Ulysses, an
alcohol-to-jet sustainable aviation fuel (SAF) project in the northern
Queensland state city of Townsville. Argus spoke to chief executive Ed Mason on
the sidelines of the Townsville Summit on 27 November about the project's
initial engineering. Edited highlights follow: Regarding the proposed 102mn l/yr
refinery here in Townsville, what are some of the initial engineering study
findings? So with front-end engineering and design (FEED), what we're doing is
value engineering, which you typically do at the end of FEED, we're doing it at
the front because we've seen so many opportunities to improve on the reference
project design in Georgia, US — they're just basically lessons learned from what
LanzaJet have seen, as well as what we've identified as opportunities to
eliminate, reduce, simplify costs. We've got hydroprocessed esters and fatty
acids (HEFA), that's the kind of space rocket that can get you to the moon,
we've now got alcohol-to-jet commercialised, which is like the space shuttle —
slightly better, which can do more. But we really need to see a SpaceX type of
system where you can go up and down and make it more efficient, so it's making
those technologies far more capital efficient and better, so that's what we're
focused on. W here are negotiations at with refiners Wilmar and Manildra, the
two main producers of ethanol in Australia? We basically have constructive
discussions in particular with Wilmar, they have surplus capacity, they're vocal
supporters of development of the ethanol market, as you know, for many years.
We've got ample supply (183mn l/yr) and confidence about what we need for SAF
and importantly, assisting that supplier getting that feedstock RSB and Corsia
certified. Looking at the regulatory situation at the moment, a low-carbon fuel
standard. How critical is that to building a project like yours to final
investment? We made a submission on the [low-carbon liquid fuel paper]. We're
advocating both supply and demand measures and were fairly aligned with the
wider industry submission. We believe a modest mandate, 1-2pc, supports and is
ahead of what the project pipeline is, so you're not putting a mandate that
can't be achieved by the projects at our stage but that sends a strong signal,
like other countries have already sent. Secondly, supply measures around
financing like other types of mechanisms you've seen with Hydrogen Headstart ,
just to get the industry going. How tight is the window for Australia to catch
up with the rest of the world? It's very tight. I think we've got to move in the
next two years — there is a wall of demand from 2030 and these projects take
five years to develop from start to finish. If we don't move in this in the next
few years, we'll end up seeing the feedstock develop that market, but not the
production of SAF and we'll lose out on those jobs. A standard size plant has
been proposed in Townsville, how much room do you have to grow that capacity in
Townsville? We'd very much like to be bigger if the market was there for
ethanol. We've sized it at the minimum size that we feel can deliver commercial
volumes of SAF at a price that's in line with benchmark, but the bigger you go,
the bigger economies of scale you get. These are modules, we can increase and
add another train to Townsville quite easily, so a huge opportunity to grow
that. The actual plant construction timeframe, what does that look like? The
longest lead item is 14 months, but I'd assume two years. So if we are at final
investment decision in the second half of next year, we could conceivably see
this project start producing SAF by the second half of 2027. Is sugarcane going
to be sufficient for growing AtJ SAF, or will we need other feedstock in the
future? The sugarcane industry has theoretically got the biggest contributing
opportunity, particularly short to medium term with this industry. But you've
got agave, you've got other types of crops that can produce like sorghum and
other types of sources of ethanol that can be used, and they are a potentially
medium-to-long-term supply opportunity. [Farming lobby] Canegrowers ran a fairly
extensive campaign around the potential of biofuels in the last Queensland state
election, and we've seen other bodies in the sugar industry run similar
campaigns so the industry, from grower to miller, is supportive of developing
the industry. We've only seen sugar mills close in north Queensland over the
last decade, I think ultimately the rest of the world's sugar industry has
already moved on [biofuels]. By Tom Major Send comments and request more
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