French energy and engineering firms have teamed up with Airbus to create a joint venture to develop a large-scale Sustainable Aviation Fuel (SAF) production project at the Port of Dunkirk in France, the companies said on Tuesday.
Technip Energies, Airbus, Safran, and Tereos are setting up Rebound, the joint venture aimed at developing a production capacity of 160,000 tons of Alcohol-to-Jet SAF per year at Dunkirk.
The new venture would strengthen European energy sovereignty and support France’s industrial leadership in the energy transition, Technip Energies said.
With today’s agreement, the partners committed to fund the project’s development phase, including engineering studies and other activities required to consider a Final Investment Decision (FID).
The creation of the joint venture is subject to customary closing conditions and approvals and is expected to be finalized in the second half of 2026.
The creation of the SAF joint venture comes at a time in which airlines face billions of dollars of additional fuel costs amid the spike in jet fuel prices in the wake of the Iran war. It also comes as the SAF industry is struggling to deliver, with supply and projects too little and too few to meet the EU mandates for fuel blending and SAF share in aviation fuel supply.
This year, the industry is set to use SAF for only 0.8% of its total fuel consumption, according to projections by the International Air Transport Association (IATA) released this past weekend.
The Middle East conflict and the spike in jet fuel prices would halve the profitability of airlines due to the supply disruptions and high prices, IATA said.
The additional cost of airline purchases of SAF is expected to reach $4.3 billion in 2026 for an anticipated volume of 2.4 million tonnes of SAF being available, or 0.8% of total fuel consumption.
“This is slightly lower than previous estimates as the spread between jet fuel and SAF has dropped due to the appreciation of conventional fuel prices,” IATA said.
By Tsvetana Paraskova for Oilprice.com
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