Asian Development Bank to fund $86.2 million sustainable aviation fuel facility in Pakistan

The Asian Development Bank (ADB) will help with financing the development of a Sustainable Aviation Fuel (SAF) facility in Pakistan.

The plant will be built by Bio Tech Energy (PVT) Ltd. (BTE) and will have a production capacity of 200 kilotonnes per annum (ktpa).

The project is reportedly valued at $86.2 million and aims to convert local waste resources into a high-value export product.

According to an ADB report, the new fuel plant is expected to bring significant economic benefits by producing an environmentally friendly fuel product that can be traded globally.

The plant will help reduce greenhouse gas emissions and create skilled jobs for Pakistani engineers through technology transfer and training.

It will also formalize and economically improve the existing illegal gutter oil market, positioning Pakistan as a key player in the global Sustainable Aviation Fuel industry.

BTE already owns and operates a bio-diesel refinery in Sheikhupura, which started commercial operations in 2016. This second-generation multi-feedstock refinery produces 45 kilotonnes per annum (ktpa) of biodiesel, which is sold in EU markets.

The refinery uses waste-based feedstock, including used cooking oil, poultry feather acid oil, and soap stock acid oil. BTE is the leading bio-diesel supplier in Pakistan and the only large-scale producer in the region.

The new SAF facility will be developed on a brownfield site next to the existing biodiesel operations and will share some key infrastructure.

As part of the expansion plan, BTE aims to collect up to 260,000 tonnes of feedstock, which is about 20% of Pakistan's total collectable feedstock. This will be achieved by expanding collection points in major cities such as Karachi, Peshawar, and Islamabad.

According to the International Air Transport Association, sustainable aviation fuel will play a significant role in reducing the aviation industry's emissions, potentially expanding to 407 million tonnes by 2050.