Sydney Airport eyes former Kurnell oil refinery for canola conversion to sustainable aviation fuel

Daily Telegraph

Sydney Airport is eyeing the former Kurnell oil refinery, with its direct pipeline to the airport’s refuelling facilities, for local conversion of domestic agricultural products like canola oil into sustainable aviation fuel (SAF) for planes.

At the moment more than 99 per cent of flights are powered exclusively by conventional jet fuel but the global race is on to convert to SAF – an environmentally-friendly alternative widely viewed as international air travel’s only real path to decarbonisation.

Singapore’s Civil Aviation Safety Authority will require all departing flights to be powered at least one per cent by SAF from 2026, rising to 5 per cent by 2030, while the Oneworld Alliance of airlines that include British Airways, Cathay Pacific and Qatar Airways has set a 10 per cent target for 2030.

Sydney Airport CEO Scott Charlton warned with governments and airlines overseas now introducing minimum SAF requirements, Australian airports will soon have little choice but to import SAF to meet international demand.

Canola farmers in regional NSW could hold the answer, as producers of biofuel “feedstock”, he said. Growers produce 1.8 million tonnes of canola each year but almost half is exported overseas.

“It seemed sort of criminal that we would produce the raw materials to have it shipped offshore – from a sustainability point of view, that’s not great either – then to ship it back to put into the aviation supply,” Mr Charlton said.

Establishing a SAF production facility at Ampol’s Kurnell fuel import terminal is a “no-brainer”, he said – and an unmissable opportunity to lead the nation and the world in green aviation.

“The infrastructure is there – once you produce SAF it just goes down the same pipelines, it gets blended with the same fuels, so there’s not a whole lot of other investment that needs to be made,” he said.

“We just need the material.”

Modelling submitted to the federal government’s aviation green paper by Qantas found domestic SAF production “has the potential to contribute approximately A$13B in GDP per year by 2040”, and Queensland is already swallowing up opportunities with state and federal government backing.

Investment firm IFM Investors signed a memorandum of understanding earlier this year with energy company Ampol and agricultural distributor GrainCorp to investigate SAF production at a Brisbane refinery, while Australia’s first SAF refinery is currently being built in Townsville to produce enough fuel to meet demand at both Cairns and Townsville airports.

Qantas CEO Vanessa Hudson said the airline would “look closely” at SAF opportunities in Sydney like the Kurnell proposal.

“Australia has the potential to be a global leader in the production of sustainable aviation fuel and it’s going to be critical for the future of the aviation industry,” she said.

“We’re already backing Australian projects through a partnership with Airbus that will accelerate an onshore SAF industry and we’ll look closely at projects with existing infrastructure like the one at Kurnell, should the idea get off the ground.”

Ampol General Manager of Hydrogen and Next Gen Fuels Michael Hart stopped short of naming Kurnell as Australia’s next major SAF production site, but said more generally the company’s existing infrastructure and capabilities “could play a pivotal role in creating a national renewable fuels ecosystem” – with supportive government policies in place.

“Australia has a compelling competitive advantage in infrastructure, technical expertise and the availability of raw materials necessary to develop a domestic renewable fuels capability,” he said.

Third-generation Stockinbingal canola, wheat and barley farmer Rick Mattiske is enthusiastic about the potential of Australian-made renewable fuel.

GrainCorp has been his largest buyer for years and while he doesn’t “get to see where it goes in the end” shoring up a bigger domestic market for his produce would secure against the impact of future trade tariffs.

“Barley is a prime example – when China put a tariff on Australian barley, we just lost everything,” he said.

“(SAF) would be another avenue for Australian farmers to go to, so I think it’d be fantastic.”

Federal Transport Minister Catherine King said the Albanese government is consulting on policies that would enable local low-carbon fuel production, and has allocated $30 million to developing a domestic industry via the Australian Renewable Energy Agency.

“Making sustainable aviation fuel on our own shores - from Australian renewables and Australian feedstock – will make our future fuel supply cleaner, stronger and more secure,” she said.