Lufthansa Group and integrated oil, gas, and chemicals company OMV announced today a new supply agreement for more than 800,000 tons of sustainable aviation fuel (SAF) between 2023 – 2030, in a deal aimed at advancing the sustainability-related goals of both companies.
The deal comes as the aviation industry is facing increasing scrutiny as a significant source of GHG emissions, responsible for 2-3% of global emissions, with that figure set to rise dramatically over the coming decades if no action is taken. SAF is seen by market participants as one of the key tools for the industry to address its climate impact, as it generates significantly lower lifecycle carbon emissions – up to 80% lower – relative to conventional jet fuel.
OMV is already a supplier of SAF to Lufthansa Group’s Austrian Airlines at Vienna International Airport, and the new Memorandum of Understanding (MOU) is aimed at expanding the companies’ partnership by adding new locations for SAF production and offtake as well as new SAF production technologies.
Earlier this year, OMV launched “Strategy 2030”, outlining its plans to shift from oil & gas production to renewable fuels and circular solutions and become a net zero emissions company by 2050. As part of its new strategy, OMV is aiming to position its Refining & Marketing business as a leading producer of sustainable fuels and chemicals feedstock in Europe, including plans to increase production of sustainable fuels and chemical feedstock to 1.5 million metric tons per year by 2030, with sustainable aviation fuels accounting for almost half of the volumes.
Lufthansa Group aims to achieve a neutral CO2 balance by 2050, and has set an ambition to halve its net CO2 emissions by 2030, on a 2019 basis. The company is already the largest SAF customer in Europe, and recently signed one of the industry’s largest SAF supply deals to date for 1.8 million metric tons of sustainable aviation fuel with Shell.