Taiyo Oil Launches Study for Sustainable Aviation Fuel (SAF) and Renewable Diesel (RD) Production in Okinawa

2023.07.26

Taiyo Oil Co., Ltd. (Headquarters: Chiyoda-ku, Tokyo; President & CEO: Yutaka Oka) is pleased to announce that it has launched a study for the large-scale production of Sustainable Aviation Fuel (SAF) as an alternative to aviation fuel and Renewable Diesel (RD) as an alternative to light oil, utilizing the facilities and idle land in Okinawa of its subsidiary Nansei Sekiyu K.K. (Headquarters: Nishihara-cho, Nakagami-gun, Okinawa Prefecture; President & CEO: Osamu Murakami), as part of our ongoing efforts to actively promote and achieve a carbon neutral society.

1.Background of the Study

Since the acquisition of Nansei Sekiyu in 2016, Taiyo Oil has been exploring new business opportunities that can contribute to the local community by leveraging Nansei Sekiyu's idle land in Okinawa, while ensuring the stable supply of petroleum products to the region. Okinawa Prefecture is a region that faces challenges in developing large-scale power sources utilizing renewable energy, resulting in high dependency on fossil fuels such as petroleum and coal compared to other areas in Japan. Moreover, the transportation sector, including airplanes, trucks, buses, and ships, accounts for the largest share of CO₂ emissions in Okinawa, underscoring the importance of utilizing SAF and RD to substantially reduce CO₂ emissions and work towards achieving carbon neutrality by 2050.

2.Outline of the Study

This project aims to employ the Alcohol to Jet (ATJ) technology* to produce up to some 220,000 kiloliters per year of SAF/RD domestically. Studies will be carried out with a view to starting supply by the end of FY2028.

Ethanol, the raw material for SAF/RD is abundantly available, and the utilization of the pier and storage facilities of Nansei Sekiyu, a former refinery, will allow the import of ethanol via large tankers, ensuring competitive raw material procurement.

As part of this project, Taiyo Oil has agreed to conduct a joint research study with Mitsui & Co., Ltd. (Headquarters: Chiyoda-ku, Tokyo; President & CEO: Kenichi Hori), and this joint research study was selected as the "FY2023 Okinawa-style Clean Energy Introduction Promotion Investigation Project" by the Okinawa General Bureau of the Cabinet Office in April 2023. This joint research study is positioned as part of the studies to be conducted for this project and is currently being conducted jointly with Mitsui & Co. and Nansei Sekiyu.

As eco-friendly sustainable tourism is gaining attention, the creation of this project in Okinawa, a prefecture renowned for its vibrant tourism industry, is expected to lead to further economic development.

Further, Okinawa Prefecture's location at the center of East Asia opens opportunities for the export of SAF/RD not only within Okinawa Prefecture and Japan, but also to other parts of Asia. We are also exploring the utilization of domestically produced biomass materials in the future.

ATJ technology*: Technology for manufacturing SAF/RD from alcohol (ethanol) as the raw material through catalytic reactions. It has already obtained the necessary ASTM certification under "ASTM D7566 Annex 5" for use in aircraft.