Egypt Launches $570M SAF Plant in Alexandria Targeting 2029 Output

Egypt is moving forward with a major energy transition project, committing $570 million to establish a new Sustainable Aviation Fuel (SAF) production facility in Alexandria. The initiative is being driven by the Egyptian Sustainable Aviation Fuel Company (ESAF), a subsidiary of the state-owned Egyptian Petrochemicals Holding Company (ECHEM). The plant aims to achieve an annual production capacity of 120,000 tonnes by its scheduled start of operations in 2029.

The project represents a significant step in Egypt's strategy to decarbonize its aviation sector and position itself as a key supplier of green fuels in the Mediterranean region. By utilizing waste-based feedstocks, primarily Used Cooking Oil (UCO), the facility is projected to reduce carbon dioxide emissions by up to 400,000 tonnes annually compared to conventional jet fuel production. The technological backbone for the project will be provided by Honeywell UOP, which will license its Ecofining™ process, a hydrotreating technology designed for converting renewable feedstocks into SAF.

Project Structure and Technology

ESAF was established in 2024 specifically to manage this project, with ownership split between state petroleum companies (85%) and the private sector (15%), according to the Egyptian Cabinet. The selection of Honeywell UOP's technology is critical, as its Ecofining process boasts an 80% conversion efficiency for waste fats and greases into drop-in fuel compatible with existing aircraft and airport infrastructure. ESAF recently acquired Egypt's first license to produce aviation fuel, a key regulatory step for the project.

In a statement, Egyptian Minister of Petroleum Karim Badawy described the project as a "significant milestone for Egypt's petroleum sector and a key step in reducing aviation emissions." Khaled Hashem, President of Honeywell Middle East and Africa, added that the partnership will bolster "Egypt's capacity to produce SAF meeting international standards."

Market Demand and Regulatory Drivers

The economic viability of the Alexandria plant is underpinned by growing international demand for SAF, driven by regulatory mandates. Key among these are the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), administered by the International Civil Aviation Organization (ICAO), which incentivizes airlines to adopt lower-carbon fuels. Additionally, the European Union's ReFuelEU Aviation regulation mandates increasing levels of SAF blending at EU airports, creating a strong potential export market for Egyptian-produced fuel.

This move aligns with a broader industry trend toward waste-derived feedstocks, which avoid the land-use conflicts associated with first-generation biofuels. However, the project also enters a market facing challenges. The International Air Transport Association (IATA) recently revised its 2025 SAF production estimates downward, citing a lack of sufficient policy support globally. State-backed initiatives like Egypt's are therefore crucial for scaling up production to meet industry targets.

Regional Context and Stakeholder Impact

Egypt's investment follows a pattern seen across the Middle East, where state-backed energy firms are diversifying into green fuels. In 2023, a partnership between Masdar, bp, and ADNOC was formed in the UAE to conduct feasibility studies for SAF production, demonstrating a regional shift away from sole reliance on fossil fuels.

The project's impact extends across several sectors within Egypt. For ECHEM, it represents a strategic diversification into a high-growth green energy market. For EgyptAir and other regional carriers, it provides potential local access to SAF, which could reduce reliance on expensive imports needed to comply with international regulations. The initiative is also expected to formalize the waste management sector by creating a monetized supply chain for up to 160,000 tons of used cooking oil annually.

Waste-Based SAF vs. Conventional Jet A-1

What Comes Next

The project is proceeding along a defined timeline. According to ECHEM, a final financial assessment is expected to conclude by mid-2026. Construction is slated to begin in late 2026, with the facility confirmed by ESAF to begin operations in 2029. However, industry analysts note that securing a consistent and scalable supply chain for used cooking oil will be a critical challenge for the project's long-term success.

Why This Matters

This $570 million investment is more than a single infrastructure project; it signals Egypt's strategic intent to become a significant player in the global energy transition. By leveraging its established petrochemical industry and partnering with a leading technology provider, Egypt is creating a template for how traditional energy economies can pivot to sustainable fuel production. The success of this facility could influence regional energy policy and provide a crucial supply source for airlines working to meet ambitious decarbonization goals.