Velocys, Toyo Engineering build on SAF partnership in Japan
Velocys has signed a collaboration agreement with Toyo Engineering to start development of commercial projects to produce sustainable aviation fuel (SAF) and other renewable fuels in Japan.
The agreement follows work conducted last year between the companies at the biomass-to-SAF demonstration facility in Japan, including technical engineering, operational services and delivery of Velocys’ Fischer-Tropsch technology.
“After the successful collaboration with the demonstration plant in Japan, we are pleased to be moving onto the next stage of the plan,” said Haruo Nagamatsu, CEO of Toyo.
The new agreement calls for preliminary engineering evaluation of the FT island in a joint effort to deliver a commercial-scale biomass-to-SAF project in Japan. Velocys will grant exclusive rights for Toyo to secure and use the license and technical services of the Velocys FT technology for a commercial plant in Japan. An advanced deposit of $4 million was received in 2019, $3.5 million of which remains in escrow and will be offset against future revenue.
“The commercial deployment of the integrated technology that has been demonstrated during 2020, including the Velocys FT technology, is now underway with the first stages of the engineering designs,” Nagamatsu added.
“Making our first steps into commercial delivery in the Japanese market strengthens our position in an additional geography to North America and Europe,” said Henrik Wareborn, CEO of Velocys. “Our clients recognize the importance of our here-and-now technology solution for commercial-scale projects, not only greatly reducing Scope 3 life-cycle carbon emissions but also resulting in synthetic fuels with air-quality advantages over conventional fuels. …Whilst there is no immediate material impact on revenue, we are delighted that the collaboration provides a pathway to commercialization in Japan.”
The renewed collaboration extends to other SAF, e-fuels and biomass-to-liquid projects in Japan.