With investment from Shell, LanzaJet seeks to produce 10 million gallons of ethanol-based jet fuel by 2023

LanzaJet Chairman of the Board, Dr. Jennifer Holmgren, said if you walk past the company’s Alcohol-to-Jet (AtJ) aviation fuel production plant in Soperton, Georgia, at the end of 2022, it “will look exactly like what you drive near a [petroleum] refinery, a smaller version of a complete refinery”.

While 10 million gallons of jet fuel sounds like a lot, it’s not even a drop in the bucket of global consumption. Commercial airlines consumed 96 billion gallons in 2019 and were expected to reach 98 billion gallons before the pandemic hit in 2020. LanzaJet’s scale demonstration version of a full refinery will be staffed by around 50 people and, if the company’s business plan is successful, grow in size and number over the decade.

Established last year, LanzaJet is a subsidiary of Illinois-based LanzaTech, a carbon recycler that uses a bacterial process that produces ethanol and/or specialty chemicals from industrial “off-gases.” . Off-gas includes syngas generated from any biomass resource (solid waste, organic industrial waste, agricultural waste) and reformed biogas.

According to LanzaTech, the process is “like retrofitting a brewery on an emission source like a steel mill or landfill, but instead of using sugars and yeast to make beer, pollution is converted by bacteria into fuels and chemicals”.

LanzaJet’s specific AtJ process converts ethanol into synthetic paraffinic kerosene and synthetic paraffinic diesel. Efficiency can be up to 90% Sustainable Aviation Fuel (SAF), with the remaining 10% being renewable diesel. The company says its process reduces greenhouse gas emissions by more than 80% compared to conventional jet fuel and has minimal impact on food, land and water use.

Ms Holmgren says SAF is one of three revenue streams the parent company will cultivate, the others being the production of ethanol for use in consumer goods (clothing, seatbelts, etc.) and the production of chemicals using patented synthetic biology. But SAF has attracted enough investment to create a dedicated subsidiary.

Royal Dutch Shell Plc is the newest equity investor in LanzaJet, joining Suncor Energy Inc., Mitsui & Co., Ltd. and British Airways. Although the size of Shell’s investment was not disclosed, the refiner has caught up with peers like British Petroleum and Total SE in France, which have invested heavily in renewable energy companies.

LanzaJet does not state the schedule or volume production threshold it will need to create a positive return on investment, but other aviation synthesis and biofuel companies are aiming for profitability in the mid/late years. 2020s. Based on current ethanol prices, a gallon of LanzaJet SAF costs around $3 according to Holmgren. That compares to a spot price of $1.58 a gallon for fossil jet fuel in early April according to the International Air Transport Association.

In addition to acquiring equity, LanzaJet investors will help market SAF’s production in their own jurisdictions (Canada, Europe, UK, Japan), Holmgren said. “By doing this, hopefully by 2025 or 2026 we will have over 150 million gallons of SAF [annually] on the market.”

Shell’s aerospace distribution channel (like Suncor) is naturally complementary, key to market penetration. Access to LanzaJet’s gas-to-ethanol process is the primary motivation for the oil refiner’s investment, Holmgren points out, giving them “a seat at the table” while learning how to take advantage of alternative liquid fuels.

The exploitation of alternative fuels also confers the imprimatur of “decarbonisation”, an incentive as much political as environmental for multinational companies of all persuasions.

LanzaJet has previously tested its SAF in jet airliners, performing its first commercial flight in the tanks of a Virgin Atlantic 747 in October 2018. The SAF was mixed 50-50 with conventional Jet A, as required by the American Society for Testing and Materials (ASTM) standards agency.

However, LanzaJet’s fuel has been carried in jets at up to 90% and higher in trials with the National Research Council of Canada. Holmgren points out that aircraft engine manufacturers like Rolls Royce and General Electric continue to make progress in certifying 100% synthetic/biofuel operation at their power plants, which is likely driving demand.

SAF production ramp-up and large-scale commercialization will take time, giving competing propulsion sources an opportunity to gain a foothold in the market. Electrification is chief among these, although hydrogen fuel cells and, more importantly, the combustion of pure hydrogen are also attracting attention.

Like other producers of alternative aviation fuels, Holmgren does not expect these sources to be major competitive factors for LanzaJet’s SAF in the short to medium term.

“Electrification is going to be a regional problem [aviation propulsion] Solution. You’re not going to fly an electric plane between Orlando and Gatwick [UK] soon. Hydrogen may be suitable for longer range [flights] in the short term, but it will also take some time before this infrastructure is realized. If we want to decarbonize, we should want all of these solutions to succeed. »

LanzaJet is well capitalized for this demonstration phase of its growth, says Holmgren, but the company is seeking assistance in the form of a loan guarantee from the US Department of Agriculture to underwrite the debt associated with setting up the its Georgia plant.

The SAF maker will establish as many four production plants as it fits the market, a status bolstered by British Airways’ plans to use quantities of LanzaJet’s ethanol-derived fuel from the end of 2022 .

“We are in very rapid growth mode and Shell’s investment is helping us,” acknowledges Holmgren.

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