US military to "jump start" synthetic jet fuel market with tender

Kuala Lumpur (Platts)--16Nov2006

The United States military is to issue its first buy tender for synthetic
jet fuel, Pamela Serino of the US' Defense Energy Support Center, said at an
aviation industry gathering in Kuala Lumpur Thursday.
The DESC, which buys 8.3 billion gallons of fuel a year, is looking to
"jump start" the synthetic jet fuel industry, she said. Once the US armed
forces begins using alternative jet fuel, it would only a short step to
commercial use of the fuel as it would already have passed stringent testing
by the military, added Serino.
The tender, for about 500,000 gallons of synthetic jet fuel derived from
natural gas, coal or biomass, would be issued to potential suppliers before
the end of the year.
The US' DESC, the largest buyer of fuel in the world, is looking to use
synthetic jet fuel to lessen its dependence on crude oil, particularly from
trouble spots in the Middle East. Synthetic fuels would enable the DESC to
improve security of supply, said Serino.
In addition, the DESC would be able to lower environmentally hazardous
emissions, such as carbon dioxide, Serino added at the sidelines of an
International Air Transport Association forum in Kuala Lumpur, Malaysia.
The US military jet fuel tender is for synthetic fuel made via
Fischer-Tropsch synthesis, developed in Germany during World War II. The
technology has been developed further by South Africa's Sasol, which operates
a commercial plant in South Africa and is one of the potential suppliers to
the DESC.
Sasol uses coal to create jet fuel and supplies Johannesburg airport with
the product. About 10 to 20% of fuel used at the aviation hub is synthetic
jet.
Several major companies have announced plans to build large FT plants,
which if completed could yield about 1 million b/d of total product by 2020,
according to estimates by Us-based oil giant Chevron.
--Daniel Booth, daniel_booth@platts.com

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