In partnership with British Airways, Velocys is developing a facility that could convert up to 500,000 tonnes of municipal solid waste into fuel for planes and cars each year (see letsrecycle.com story).
Velocys is providing project development services, engineering, and ‘FTS technology’.
In a trading update published this week, the sustainable aviation fuel company said it had completed site engineering, a geotechnical survey, and the integration of carbon sequestration of biogenic CO2.
Velocys said the East Coast cluster was scheduled to come “on stream” around the same time as the commissioning of its plant in 2027, subject to the government funding both the Altalto project and the cluster.
Last month, it was announced that Velocys’s application to the department for business, energy and industrial strategy (BEIS) to participate in the East Coast CCS cluster had met the government’s eligibility criteria (see letsrecycle.com story).
This means the project has passed through to Phase 2 of the evaluation process to identify and sequence CCS clusters suitable for deployment in the mid-2020s.
In the trading update, Velocys said it had benefitted from a £1.9m Green Fuels Green Sky grant awarded to it by the department for transport in August 2021, “which has largely covered our costs for the essential site engineering and other site-related work through to Q2/22”.
Investment
Meanwhile, Velocys and British Airways also welcomed private equity investment manager Foresight Group LLP to the Altalto project.
On 24 March, Velocys announced that Altalto Immingham Ltd, a subsidiary set up by the company to oversee the project, had sold its 100% interest in Rula Developments (Immingham) Limited (RDIL) to funds managed by Foresight for £9.75 million. RDIL owns the site for the project.
Altalto retains an option to buy back RDIL for up to £12.95 million within three years.
In addition, Altalto has agreed to grant Foresight a right of first refusal to invest up to £100 million in the project, alongside British Airways and other future investors once the full funding is required.
Henrik Wareborn, Velocys’s CEO, said: “Velocys is pleased to have Foresight involved in the Altalto project, alongside British Airways. This is a further step in bringing our SAF enabling technology solution to market.”
Velocys previously said it hoped that construction of the plant would begin in 2022 and that the facility could produce fuel by 2025.
The company expects to announce its results for the year ending on 31 December 2021 during the week commencing 16 May.
Fuel
Velocys uses the Fischer-Tropsch (FT) process, a catalytic chemical reaction, to turn synthesis gases such as carbon monoxide and hydrogen into liquid hydrocarbons, such as diesel or jet fuel.
Explaining, his company’s work, Mr Wareborn said: “The Velocys group is well positioned at the nexus of energy security and the net zero transition.
“Through the deployment of our patented demonstrated FT and catalyst technology, we provide decarbonisation solutions for hard-to-abate sectors such as commercial aviation, to supply negative carbon intensity fuels to airlines and others committed to net zero targets, while also reducing import dependency on fossil fuels.”
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