Air France-KLM strikes SAF deals with Neste, DG Fuels

Air France-KLM (EPA:AF) on Tuesday said it has signed two binding contracts to source sustainable aviation fuel (SAF) from Finnish refiner and renewable fuels producer Neste Oyj (HEL:NESTE) and US company DG Fuels.

Under the contracts, the airline will receive a total of 1.6 million tonnes of SAF in the period from 2023 to 2036. The deal with Neste is for 1 million tonnes to be supplied between 2023 and 2030, while the agreement with DG Fuels is for 600,000 tonnes in the 2027-2036 period.

Neste said its contract is one of the largest of its kind in the aviation industry. The company’s Neste MY Sustainable Aviation Fuel is a drop-in fuel produced from renewable waste and residue raw materials, such as used cooking oil and animal fat waste.

“By the end of next year, Neste will have an annual SAF production capacity of 1.5 million tons, ready to support the Air France-KLM Group and other airlines in Europe and across the globe,” said Thorsten Lange, executive vice president, Renewable Aviation at Neste.

Air France-KLM seeks to incorporate 10% SAF by 2030 and estimates that the new contracts will cover 3% of the SAF needs.

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