Royal Dutch Shell is eyeing opportunities in sustainable aviation fuel (SAF) and electric-vehicle charging points in Asia as it reduces its oil-refining operations in the region, according to Huibert Vigeveno, the group’s downstream director.
The oil major sees strong demand in Asia for SAF, and customers including Singapore Airlines, Cathay Pacific Airways and Japan Airlines have been requesting it, he said in an interview. Shell is aiming to produce about 2-million tonnes a year of the fuel around the world by 2025, and wants it to make up 10% of all jet-fuel sales by 2030, it said in a statement in September.
Alternative aviation fuel, which can be made from feedstocks including algae and cooking oil, is still a lot more expensive than traditional jet fuel. It accounts for just 0.1% of global supply.
Shell is paring back its oil processing globally and plans to halve greenhouse gas emissions from its operations by 2030. It’s slashing capacity at its Pulau Bukom manufacturing complex in Singapore, its largest refinery worldwide, and said this week it would open a plant in the city-state that would produce 550,000 tonnes a year of biofuels for transport.
The new facility in Singapore, which is still subject to final investment approval, would supply SAF to air travel hubs including Changi Airport in the city-state and Hong Kong International Airport, Vigeveno said.
He defended Shell’s move to wind down its oil-refining operations. While processing margins have begun to improve in recent months, they’re still far from historical levels, Vigeveno said. “There’s still a lot of overcapacity in refining, and I’m not seeing significant closures of refineries versus what’s still continuing to be added.”
Shell — which recently announced it would move its global headquarters from the Netherlands to London — has plans to increase electric-vehicle charging points, Vigeveno said, and is seeing the highest utilisation rates in China. The company has 80,000 charging points globally and wants to raise that to 500,000 by 2025 and 2.5-million by 2030, he said.
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