TRIC refinery sale targets renewable aviation fuel market

In September 2021, the Sustainable Aviation Fuel Grand Challenge was launched by a conglomerate of government agencies with the goal of producing 3 billion gallons of sustainable aviation fuel annually.

A portion of that fuel will come from the New Rise Renewables refinery at Tahoe Reno Industrial Center.

XCF Global Capital, a holding company formed in 2023 with offices in New York and Sacramento, is in the final stages of acquiring the New Rise Renewables facility and converting it from producing renewable diesel to sustainable aviation fuel. XCF Global has additional SAF facilities coming online in Wilson, N.C., and Ft. Meyers, Fla., but the 10-acre Northern Nevada refinery will become the company’s global headquarters and flagship operation once the acquisition is complete and production begins, said Mihir Dange, XCF’s chief executive officer.

“The New Rise facility has the potential to be among the earliest sustainable aviation fuel production facilities in the United States,” Dange told NNBW.

XCF – X Carbon Footprint – seeks to reduce carbon intensity in the aviation industry by producing sustainable aviation fuel and is creating a portfolio of assets to that end, Dange said. There’s expected to be a billion-gallon production shortfall in the 3 billion gallon threshold of the Sustainable Aviation Fuel Grand Challenge, he added.

“We have a long way to go; global production today is very low,” Dange said. “Last year, total global SAF production was roughly 160 million gallons. The ramp that will happen over the next four or five years will be tremendous.”

New Rise Renewables’ staff of scientists and chemical engineers have been working throughout the year to convert the refinery from producing renewable diesel to sustainable aviation fuel. Dange said the facility includes a pre-processing plant, which allows it to take in a wide range of potential feedstocks, including soybean oil, distiller’s corn oil and many other types of waste oils, as well as any type of animal grease or tallow.

“The pre-processing plant will allow us to choose from a wide variety of feedstocks to control costs and satisfy various customer requirements,” Dange said.

Currently, there are eight different certified conversion technologies that companies are using to produce sustainable aviation fuel from waste feedstocks and biomass on a larger commercial scale. XCF Global is pursuing a pathway called HEFA, which stands for hydroprocessed esters and fatty acids. The HEFA process is similar to what’s used to create hydrotreated renewable diesel fuel.

“Existing refiners are moving into this sustainable aviation fuel model because the economics are a little bit better than traditional petroleum-based products,” Dange said.

Jet engines can use SAF without any mechanical modifications, though blends of sustainable aviation fuel and Jet A are capped at 50 percent. However, commercial standardization for SAF blends is still being defined, Dange noted.

“There has to be a minimum of a 10 percent blend of neat (unblended) sustainable aviation fuel with at least 90 percent of Jet A, and it can go as high as 50 percent,” he said. “Typical blends are either 80/20 or 70/30. They are trying to create some type of standardization around it, and it's starting to trend towards that blend of 70 percent Jet A and 30 percent neat sustainable aviation fuel.

“SAF has the potential to reduce CO2 emissions by up to 80 percent compared to traditional jet fuel,” he added.

New Rise Renewables is currently operating as an independent company, but once it is fully acquired later this year it will operate under the XCF Global umbrella, Dange noted. Production of SAF, meanwhile, is expected to begin by the end of the year or early first quarter of next year, he added.

Initial production volume is expected to be around 38 million gallons of neat SAF in 2025, Dange said. The path to production has been long and arduous, he added, mostly because of the relative newness of the SAF industry, especially when compared to standard oil and gas production and refining.

“Everybody is trying to evaluate the preferred pathway for SAF and what brings in the lowest carbon intensity score,” Dange said. “They are also trying to figure out what a standard round of financing looks like, and what a standard offtake agreement looks like. Because there isn’t any true standardization around it, we’ve spent considerable time brainstorming and collaborating within our industry. Partnerships and collaboration will drive development of the market for SAF.

“It’s been difficult to find investment dollars to purchase this facility, and it’s been a slog to convert the facility from renewable diesel to sustainable aviation fuel because we are pushing new boundaries,” Dange added. “And since it’s new, nobody really wants to take on risk so early on – investor appetite has been tepid. It’s not your typical oil and gas project, which has very common metrics and measures for underwriting because there is standardization around the project, hedging and pricing. That doesn’t exist yet in the SAF industry, and that creates investor pullback.”

Dange said that since XCF Global is breaking new ground in the sustainable aviation fuel industry, a lot of eyes are on the company. Sustainable aviation fuel produced in Northern Nevada will likely be sold in neighboring California, he added.

“Demand is through the roof, especially because aviation companies want to meet that 2030 goal,” Dange said. “Most of our product will go into California because California has its own Low Carbon Fuel Standard, so every time we deliver into California we will qualify for that credit.

“The industry is really trying to get as much production out there as possible, and over the course of the next five to seven years, I think you’ll find that HEFA is the most commercially available and lowest cost.”