The SAF Podcast: Wastefront - Making the most of a tyre situation

What if getting your tyres replaced on your car not only protected you on the road, but also helped save the planet? Currently 50 million end of life tyres are generated annually in the UK and 80% of them are exported to the EU to be burnt. What if a sustainable solution could help dispose of them but also not need for them to be exported overseas.

This week Vianney Vales, Wastefront joins Oscar on The SAF Podcast as we uncover the revolutionary process of transforming end-of-life tires into sustainable aviation fuel (SAF). Vianney, with his extensive background in the oil and gas, biofuels and project management sectors shares his journey towards innovative biofuels and climate solutions, shedding light on Wastefront's groundbreaking approach. We explore the dual-step process of converting waste tires into pyrolysis oil and then into SAF, delving into the significant environmental benefits and the advancements at their first industrial facility in Sunderland, UK.

Embarking on the journey of developing large-scale industrial projects in the UK is no small feat and on that many companies are currently tackling. Vianney provides a comprehensive walkthrough of the essential stages, from securing permits to finalizing supply chains and preparing for construction. Highlighting the project in Sunderland, he discusses first why they chose Sunderland as their first site, the hurdles and triumphs of funding such innovative ventures in Europe compared to the US. The conversation underscores the importance of early-stage funding, revealing the strategic steps that helped Wastefront de-risk and validate their project, and the ongoing capital raise efforts to secure strategic partners for the next construction phase.

Investment in pyrolysis projects presents a compelling proposition, offering both immediate profitability and long-term growth potential. Vianney outlines the strategies for attracting investors, balancing risk and reward, and the importance of clear communication. We delve into the challenges of creating scalable and profitable pyrolysis projects, the interplay between government mandates and private sector risk tolerance, and the UK's positive trajectory with its SAF mandate.

Vianney also suggests locations they are looking at for their next facilities and we discuss why a well known city called Springfield could be an excellent candidate.

If you enjoyed this discussion about finding use from waste, check out our previous episode with James Hygate, Firefly Green Fuels, who is working on making SAF from sewage: https://www.buzzsprout.com/2202964/14092944

Host and Producer: Oscar Henderson, SAF Investor 

Transcript

Speaker 1: 0:08

Hello and welcome to the latest episode of the SAF podcast. This week, we're delighted to be joined by Vianney Vales from Wastefront, and we're going to be talking about tyres and a lot of other things. So, vianneyney, thank you so much for joining us. How are you?

Speaker 2: 0:28

I'm good thanks for having me now absolute pleasure.

Speaker 1: 0:31

So before we get into wastefront and all the other things we've got installed, do you just want to take us through your background before wastefront?

Speaker 2: 0:42

sure, and actually I I started my career in uh in the oil and gas business. I started in shell and then moved to the national oil company in portugal, so I was uh you know refinery plant manager, ended up in charge of all refining trading businesses, and then I moved to the biofuel business in 2007. Was CEO of a build-on operate company operating in Europe and in the US, working with biodiesel, gasification, fissure trap solutions all kind of advanced solutions to decarbonize transport and in this role, I noticed a gap of implementation capabilities in this new business of biofuels. So I decided to tackle this problem and I set up my own project development company called Devaltech in 2017 in Houston, and the goal of that company, devaltech, was, and is, to help other companies implement their industrial projects in the energy transition, bridging that gap that I had identified.

Speaker 2: 1:56

One of my customers was actually Wastefront, the company I'm now running. After one year of cooperation, I thought this company actually ticks all the boxes that I'm looking for, you know, for a successful company in the decarbonization business. So I joined them as a CEO and here I am, three years later with a company that is now ready for prime time.

Speaker 1: 2:20

Amazing. So do you want to explain what Wastefront is, what your sort of process is and roughly where you are right now? Because I mentioned at the beginning, it's it's tyres. We're going to be talking a lot about tyres today.

Speaker 2: 2:39

But do you just want to go into a bit more detail about that? Absolutely Basically, in short sentence, wastefront offers a solution to produce sustainable aviation fuel SAF from waste tires. That's what we do. We were founded five years ago in Norway, but we decided that our first industrial facility would be in the UK, in Sunderland, northeast of the UK. We have a proprietary approach to produce SAF and there are two steps in this approach. The first one is to transform the waste ties or sometimes we call them end-of-life ties or ELTs into pyrolysis oil. This step is fully de-risked and we are ready to start the construction phase of our facility in Sunderland. The second part will be to transform this oil produced from tires into SAF. This is a proprietary process that we have developed. It will initially be done through co-processing in oil refineries and then through our solution in a centralized facility. But overall, oscar the commercial delivery of.

Speaker 2: 3:53

SAF, produced from waste size, will start already in two years time. So we're very much here now with the immediate impact on the carbonization of aviation transport, with the immediate impact on the carbonization of aviation transport.

Speaker 1: 4:06

I mean that's amazing that you've got the timeline to two years, which is, as you say, very fast. But I want to take a step back before that. As you mentioned at the beginning, you started in oil and gas, then you went into biofuels doing a build-own-operate system, then you set up Devaltech. Now you've gone back to sort of producing. What caused that transition, because it's quite interesting going from the biofuels particularly then to project implementation, then back to, you know, on the project side, on the sort of production side of things.

Speaker 2: 4:45

I guess, at heart I'm really a producer. You know, I think ultimately the producers are the ones in the front line to make a difference in climate change. So that's what I like to do. I started my career in oil and gas on the producer side, in refineries, and then when I joined the biofuel business, it was also on the producer side. You know, I only joined the biofuel business, it was also on the producer side. I only joined the project development side of things because I thought there was a real gap of implementation and I had spent half a billion dollars in multiple projects and I knew, I thought I had learned a few things about how to develop those projects. So I put that to work in Devaltek. But really, when I found Wastefront, it's as if everything that I had learned running ultra complex industrial assets and then on the project development and on the biofuels, everything that I had learned on my professional career, could be put to use in a truly winning project. So that's really. I'm back to the producer side, which is what I really, really like.

Speaker 1: 5:53

So why tyres? Why end of life tyres? What makes them a good feedstock, and how are tyres typically disposed of? Because the first thing that comes to my mind is the big tire pit in the Simpsons that's always on fire.

Speaker 2: 6:12

So that is fortunately a reality. That is vanishing a little bit, but it's still true. In some places, like in the Middle East, you still have that. Like in the Middle East, you still have that. So those giant fires which are actually extremely difficult to stop. Tires burn very well, slowly and well, and very difficult to stop such fires. But I mean in Europe most of the end-of-life tires are incinerated in cement kilns. So that's a much more virtuous application than landfills. But still it's only recovering the energy that's on a tire and some of the carbon that you have on a tire, which is carbon black, is a very fine powder, it's kind of a luxurious item and you're just burning it. Carbon black is a very fine powder, it's kind of a luxurious item and you're just burning it. It's a little bit as if you were burning diamond and were very happy that you had recovered the energy in the diamond.

Speaker 2: 7:11

So I'm not happy with that situation. I don't think a lot of people should be happy with with that and that's currently the best uh solution. You know, landfills are still used uh, not in europe, but still used worldwide. A lot of applications that were previously approved, such as these rubber granulates in playgrounds etc are now banned in Europe. So there are really not a lot of virtuous solutions for end-of-life tires. So it's a little bit of a silent scandal because we are able to export our problem to third party countries, but it's nevertheless a huge, huge problem. So for that reason and because ties have a lot of very good, nice components for the production of SAF and or for being recycled uh, ties a good is a good idea and at the same time we solve a huge pollution problem at the global, at the global scale the only people that I can think of that might be mildly annoyed at you taking all their tires, the um, the people with boats who use them as fenders on the side of their boats.

Speaker 2: 8:24

I I can reassure them because the amount just to give you an example, the amount of end-of-life ties produced in the UK is around 500,000 tons of ties per year. That's 50,000,000 ties a year and 80% of those tyres are exported. Okay, so there's still a lot of tyres that you can use to protect your boat from shock.

Speaker 1: 8:54

So good to hear that there's more than enough to go around. So you mentioned your facility in the UK is going to be in Sunderland. And why is that? Is it because of sort of exporting our tyres being exported from there now? So you've got the access. What? What makes that a good place to set up a refinery?

Speaker 2: 9:15

Yeah, so you. You mentioned one, one reason, and that's the. The UK has two advantages. One is this availability of end-of-life tires, with this 80% being exported. So you just have to capture part of this export to supply the feedstock of your plant. Just to give you an example, the first phase of the facility in Sunderland will use only 4% of the exports of tires from the UK, and even a full-scale commercial plant will only use less than 20.

Speaker 2: 9:50

Okay, so huge availability of end-of-life ties is one big advantage of the uk. Another advantage was the maturity of the rtfc system. You know the renewable transport fuel, the RTFC system, the Renewable Transport Fuel Certificate, in particular for tyre pyrolysis oil, which are already qualified as a development fuel. So these two elements made the UK a very good first project. Now why? Sunderland, particularly A port, is always good in terms of logistics and the port of Sunderland in particular has been very active in promoting a green energy initiative and we only have good things to say about them. They've been very supportive in the very, very long and cumbersome processes of planning, permit and other authorization that you need to bring a project to life in the UK.

Speaker 1: 10:50

Interesting what you say about the RTFCs. Is that not the case in Europe and in the US, where you can't necessarily get those credits?

Speaker 2: 10:59

So of course Europe and the US have a very mature system also with the. You know the red red two, red three on one hand, the LCFS on the other hand in the US and California. But for Thai derived oil, or Thai pyrosis oil, the UK is actually fully at full speed in terms of approval of that specific fuel. Devil is in the detail and you know one of our partners, the main partners, is Vitol, the oil trader. We started working four years ago with them and we worked extensively at the best jurisdiction and where to put the fuel and how to put the fuel, et cetera, et cetera, to put the fuel and how to put the fuel, etc. Etc. And we ended up concluding that the uk, for the specific product of thai parosis oil, was actually quite mature that's really interesting.

Speaker 1: 11:54

So I think you'd be hard pressed to say the uk is mature in terms of biofuels in many other places compared to europe and the us, so good to hear we're leading the way on one thing at least. Exactly, do you see feedstock competition being an issue? I know you mentioned in the UK there being 50 million tires, but I also know there are lots of other companies exploring this as a feedstock and as a production pathway. Is that something you're concerned about?

Speaker 2: 12:26

not at all. I mean, as I mentioned, you know, even even a full-scale plant is only 20 of the export and the first stage is only four percent. We are working with the largest elt trader in the uk who's exporting more than 12 million tires a year. We're working with local aggregators so we have full traceability and access to our feedstock. So in a way we are already securing enough feedstock for our own needs.

Speaker 2: 12:58

As you know, it takes a long time to develop a project in the UK. So you can competition coming. Competition is welcome, but my point is we can see it coming, because if you don't have yet a permit, a planning permit or an environmental permit, or a feed completely done, or funding, et cetera, then you are three, four, five years away and so you can anticipate a little bit the scarcity of feedstock. So if we had a project of five to 10 plants in the UK, yes, it would be an issue, but because our prospect in the UK is for two plants, two large plants, and we are securing the offtake, the supply sorry as we speak right now, um, we are not concerned at all there are other barriers uh to entry in the uk, but availability of elt and of life ties is not one of them where are you right now?

Speaker 1: 14:00

in your project, you said you're two years away, you're, you're going to be, so that'll put you in 2026. Where are you currently right now? In your project, you said you're two years away, you're, you're going to be, so that'll put you in 2026?

Speaker 2: 14:08

where are you currently? Right now, so, um, what we call the development phase is fully done. So what I mean is the whole supply chain is is ready, the feedstock agreement are ready the offtake for the oil uh is ready.

Speaker 2: 14:21

The offtake for the other main product which is recovered, carbon black. The carbon black is this fine powder that you disperse in the rubber in the tire to make the tire last longer, if you want. And when you transform the end-of-life tires through the pyrolysis process you produce at the same time oil and carbon black. The offtake of carbon black is also ready and that's been part of a big, big and long journey to increase the value of this carbon black which initially was being seen as a waste and now is a premium product in our agreements. That are ready. So full supply chain ready. And then on the site itself, the permit to build or the planning permit is granted. All the conditions precedent to start civil works are are satisfied. The environmental permit is granted, technology selected. It's integrated in a front-end engineering design, a feed package which is completed. We are ready to place order for the long lead equipment. So we are really shovel ready now. Ready to place order for the long lead equipment. So we're really shovel ready Now.

Speaker 2: 15:28

The plant will be built in two phases A first module now. First module, which is one fourth of the size of the full commercial plant, but it's a full scale module, meaning the full commercial plant is only replicating this module four times Okay. So what we aim to start now construction now is this first module. Okay, However, I just want to mention that all the permits and the supply chain are valid also for the next phase. Okay, but starting with this first module, commercial operation will start early 2026. And the oil that will be produced at that stage will immediately be co-processed and sold as SAF to the final customer, which will be an airline.

Speaker 1: 16:14

I mean, that's a long list of things you've got to get ready to get.

Speaker 2: 16:18

I could have carried on, but we have limited amount of time.

Speaker 1: 16:22

But it's just to say we're ready to start construction really I'm impressed you did them all off the top of your head quite some time now I want to know how many times you practiced it before this. Um, what about money and investment? How have you found that, and can you say where you've sort of found your funding from?

Speaker 2: 16:48

So that's one of the key questions, and how do you find the money for innovative projects and how do you bridge that gap with a fabulous idea, between a fabulous idea and an actual project that's producing something that's making money? That's the gap that I see is much wider in.

Speaker 2: 17:08

Europe than in the US, where I also worked a lot and it's much easier to bridge that gap. So what we did because, as they say, it was not my first rodeo what we did Four years ago, we started getting funding for the development phase, a lot of funding for the development phase, because we knew that it would take a long time and a lot of effort to do two things fully de-risk the project, on one hand, but at the same time make it profitable. Okay, so we raised in total in the first five years of existence, but mainly in the last four years, we raised a total of $20 million. Okay, half of it came from VTOL, our partner, and the other half from, you know, ultra net worth individual related to industrial groups in Norway and Sweden. But we've used this development capital to really create the ecosystem you know on the supply of feedstock, on the offtake of oil, on the carbon black. This implied a lot of R&D test, with samples back and forth, product going to the customers, negotiation in terms of pricing, et cetera. All this supply chain. Four years ago we didn't have any profitability with this business. Now we do On the project side. We needed to get to full permit, full feed, et cetera. Why? Because otherwise there's no money for the next phase. So we bridged that gap by being very careful in getting funded early on for the development, and VTOL strategy actually was aligned with that, meaning they liked the idea of funding the development phase of a project and then supporting the rest of the development through the offtake and not through investing in the construction phase. So that's how we managed to get to a fully de-risked and profitable proposition.

Speaker 2: 19:16

Now, right now, we are shovel ready, as I mentioned in Sunderland. We are shovel ready, as I mentioned in in sunderland. Uh, so one month ago we started a capital raise to get to fid for the construction. So we are in the middle of it. We are, you know, targeting, uh, strategic partners. Uh, you know, interested in the off take, such as airlines and refiners. We have very advanced discussion on that. We want to extend the network of strategic partners beyond VTOL, who's mainly a trader. We want someone who's really able to process and purchase SAF to be part of our company. Now, and as a complement to these more strategic industrial partners, we're looking for, you know, financial partners who are interested in funding decarbonisation or have an impact fund at this stage of development. So it's going to be a balance between strategics extending beyond VTOL and financial institution who realize that we are a here and now proposition, one of these five projects producing SAF that the UK government want to have in construction in 2025. Have in construction in 2025.

Speaker 1: 20:45

How have you found the FID financing? Has it been? I know you've been going sort of a month, but and you'd say this isn't your first rodeo have you found it frustrating or?

Speaker 2: 21:04

are you actually having lots of really productive conversations? No, I think this last round is going very well. I think the proposition of the company with one part that is fully de-risked, this waste to oil business, if you want, fully de-risked and still profitable in itself, the oil going to gasoline and diesel through the RTFC system, so you have a business that's fully de-risked, so you don't have to wait for certainty on SAF et cetera, okay, and on the other hand, the fabulous uplift of going from oil to SAF. So I think the combination of these two is attracting for investors. I mean, you need to find the right angle of attack if you want with investors.

Speaker 2: 21:51

I think that combination of the risk part of the project with the uplift of SAF and the fact that you can obtain SAF very quickly, even through coprocessing, is appealing to airlines, refiners and to those more financial entities who recognize the short-term potential. I mean, there's always a risk. It's always, you know, not frustrating, but you use that word frustrating. But yeah, it's sometimes challenging to talk to funds who sometimes you feel are not fully equipped to see the risks and reward of an innovative project. So that's why you try to create these conditions where you have everything for them. It's their risk, but it's fabulous potential which is not easy to do. Ultimately, the investors will recognize this and be able to jump on board and, by the way, we started a month ago, so we're welcoming discussions with whoever is interested. But whoever recognizes the benefit of a project like ours will be basically sitting on the right side of history later on.

Speaker 1: 22:59

Is this you talking about, the de-risked existing sort of tire to oil process, with the potential uplift to SAF later down the line? Is this your sort of project management Devaltech sort of hat that you're wearing? Is this you know, when you're looking for investment, you need this de-risk part. You need this potential upside as well. Is that experience coming in?

Speaker 2: 23:28

Absolutely. I mean, we've been managing, as Devaltech my previous company we've been managing tens and tens of projects and that combination is very powerful because, in a way, investors will always look at two things you know how much money can I make if everything goes normal and what's the minimum amount I would make if things do not go well? So you need answers for both questions and very easy to convince people that SAF is a good target. That part you read anything. If you're interested in energy, you know that. So that part is easy.

Speaker 2: 24:10

But if you rely exclusively on SAF today, you don't have enough certainty. Exclusively on SAF today, you don't have enough certainty. So having something that's already solid without the need to go to SAF is very important as a worst case scenario, super appealing worst case scenario. But then, of course, oil to SAF is your value skyrockets. So, yeah, it's definitely something that Devaltech has been, you know, very careful with and exposed to this balance between, you know, creating some certainty and maintaining uplift potential. It's been critical, this support by Devaltech in terms of of this management, but also, you know, managing epc companies, allocating risk in general where the best managed. It's all about delivery and execution ultimately and offering the investors what they really really look for do you think that's something that a lot of producers are potentially missing?

Speaker 1: 25:16

They're trying to sort of bill it as this great opportunity, SAF. Is this all but guaranteed sort of material for the next 30 years and look at the potential it's got, but aren't necessarily speaking investors' language so much?

Speaker 2: 25:33

Absolutely, I mean it's a very complex thing to create, to produce a new product and truly. Pyrolysis in itself is nothing. It's just if you prioritize ties. A lot of people actually are prioritizing ties in in India and to, and they're producing some oil that they're burning uh, you know for or to generate some, etc. This is neither circular nor economical, nor scalable, nor nothing. It's just nothing. Creating a business, you know, being able to scale it, it's incredibly difficult. I think you know.

Speaker 2: 26:08

Having worked in the oil and gas and having managed like huge and ultra complex assets, you realize that the time and the effort it takes to establish all the, the necessary conditions, it goes way beyond. You know one part of the technologies, it's everything. It's the full ecosystem supply of. Take it's back and forth, r d, commercial, you know, because at the beginning you have some oil and then customers don't like it. You need need to do tests at the customer and they say I still don't like it. But if you change that, maybe I like it. And then you change and you go back and then they change mine. It takes a huge effort. So you can't talk to investors if you have not gone through the maximum extent of the risk the risking because you'll be compared to others and you won't fare favorably do you think there needs to be more investment in pyrolysis projects for SAF globally?

Speaker 1: 27:07

do you think there's there needs to be much more capital investment into it?

Speaker 2: 27:11

of course but as as I said you know, every project needs to demonstrate its own credential.

Speaker 2: 27:18

You know, pyrolysis in itself doesn't guarantee circularity or profitability, but if a project shows circularity profitability has been the risk, as a lot of them have then yes, it should be funded, be funded. You know, the the reality is that the uk and europe, there's a little bit of a gap in terms of risk, uh risk, uh tolerance on the investment, uh, investment, side, between what the government can do at the beginning, or with mandates, and what the private sector should do. And so, yes, definitely there should be more, more investment. Uh, pyrolysis is one of the good and easiest solutions, so there should be more investment, you know, provided that you've de-risked it to the maximum possible and done things right.

Speaker 1: 28:09

A lot of SAF conversations are dominated by heifer, alcohol to jet and, to a lesser extent, fissure traps, but it's still probably in that category as the more de-risked pathways for producing SAF. Do you think there's a danger of sort of investors seeing that and going oh we know those projects work, we'll just fund lots of them, rather than looking at pyrolysis or other processes like using sewage? Like another UK company that lots of people are familiar with, firefly, do you think there could potentially be a risk of not continually looking for the new pathways being developed?

Speaker 2: 28:56

for the new pathways being developed, of course, because the appetite for a riskier project will be less than appetite for less risky project. But that's exactly why what we are bringing is a here and now solution.

Speaker 2: 29:08

That is the risk on one hand, and has an upside on the other hand and investors will use all their analysis capabilities to compare the risks of the different projects. And yes, fi is indeed a mature solution, but it's limited by feedstock availability. That's why there is a cap in the uk. Mandate outcome to jet is super interesting and but it has one plant in operation in the us.

Speaker 2: 29:34

You can't say it's fully fully the risk, but it has one plant in operation in the US. You can't say it's fully the risk, but it's proven. It needs more funding to be more commercial. We want that Fisher shops. It's a super old idea in the oil and gas business, which actually was exposed quite a lot when I was in Shell, but in our business, the biofuel business, it's still not yet in operation and definitely also needs more investment. And then other solutions like power to liquid. Those are truly more risky and less mature and longer term. So I think that investors will compare project by project.

Speaker 2: 30:16

What we try to offer is something that is the risk, although the oil to SAF is less mature, as you mentioned, than the HEFA, but it's only an uplift and actually tie the right oil is just like another crude oil. So we will get there in the oil to SAF part, but we're trying to offer a fully the risk first part of the project. But you're absolutely right, it's all going to be about risk assessment and the appetite of investors will immediately be absorbed by the less risky projects.

Speaker 1: 30:47

I want to come back to your partnership with VTOL. You've mentioned it a couple of times. How important is that relationship to wastefront? Has it been in the past into it going forward? Because you've got a what a 10-year exclusive off-tech deal with them as well as as part of it. So yeah is I mean that must be a very important relationship to nurture. It's been critical.

Speaker 2: 31:21

Actually, vitol is the one who introduced me to Wasteful, because Vitol was one of our customers in the Valtech, so Vitol has been there from the get-go. We have extremely good relationship with them. They've helped us finding the best outlets for our oil. They've helped us, you know, finding the best outlets for our oil and they've helped us you know, fund the development of the project, you know, by funding more than half of the full funds to get to, you know, shovel readiness if you want.

Speaker 2: 31:58

So yeah, they've been absolutely phenomenal and critical in terms of their strategy is really to support projects like us that they think will succeed in the development stage and then to get the offtake of the oil because, at heart, they're not investors in facilities.

Speaker 2: 32:16

So that's how, also, we started the relationship with an offtake agreement for the oil part with them, and the way the offtake agreement is structured is a win-win, meaning VTOL has an incentive to find the best outlet for the Thai-derived oil and then shares the margin with us.

Speaker 2: 32:38

And it's an incredibly difficult task, especially when you were like four years ago and trying to see OK, what can I do with this dark oil produced from tires? How can I maximize the value for waste rather than share the margin with us. So it's been phenomenal to work with them. In the last year, when we started focusing more on SAF in the sense of anticipating the SAF production, we realized with VTOL that we needed to have more latitude as waste front to directly have an offtake agreement with refiners and airlines who could our offtake agreement, a carve-out system, if you want, where we can decide to sell directly the oil and the SAF to an airline and extend a little bit the network of partners for our offtake beyond VTOL but currently VTOL. With all this effort and cooperation they are the largest shareholder in our company.

Speaker 2: 33:45

So, yeah, they're absolutely crucial to our company.

Speaker 1: 33:51

You say VTOL are crucial and it's interesting you've sort of got this agreement where you've got a bit more autonomy over SAF offtake. How important is that for Wastefront to be able to be a bit more flexible when it comes to offtaking partnerships, broadening the network, Because that's a really important aspect of it as well, isn't it?

Speaker 2: 34:11

It was super important because you know this is all the beginning. We're going to be the first one transforming oil into SAF. We need to team up very deeply with refiners and airlines. It's like three party agreements, etc. And you know, with Vitol it would be a four party agreement, so it becomes more cumbersome. So Vitol understands that very, very, very well and, supporting the effort we need to get started. And to get started we need the refiners and the airlines with us directly and you know we'll continue our journey with Vito afterwards.

Speaker 1: 34:55

We mentioned right at the beginning that the UK is actually quite mature in terms of UK is actually quite mature in terms of RTFC, RTFCs, and recently we've had the announcement of the UK SAF mandate. I'm just curious about your thoughts on that and whether you've sort of looked in detail and sort of think, yeah, this is going in the right direction. They've got a lot of things right here.

Speaker 2: 35:21

Well, definitely it's going in the right direction. 've got a lot of things right here. Well, definitely it's going in the right direction.

Speaker 1: 35:24

We were actually very pleased by the amount uh, and the timing 2030.

Speaker 2: 35:30

You know 10, 10 of every. You know jet fuel used in flights departing the uk must come from, uh, from south it's. It's really a very ambitious goal, you know it's linked to this intermediate target of having five plants in construction in 2025. So I think the mandate is fabulous. I mean kudos to the government. Of course, there's still a lot of things to be regulated and approved, et cetera. So that's why companies who rely fully on SAF are still in expectation, because you still don't have the revenue certainty mechanisms in place, et cetera.

Speaker 2: 36:13

But it's definitely going in the right direction. I mean, not a lot of countries have such ambitious goal, you know, and our process of tied to SAF is actually, you know, even mentioned as in something that should not be capped. So it's really I think it's going in a very good, very excellent direction, a little bit in the continuity of this RTFC. So I think the UK has been at the forefront there. It's just a question of how do you transform all these high-level mandate into projects that are actually implemented, and the government cannot do everything itself. You need investors to play ball.

Speaker 1: 36:59

I think you're absolutely right. In terms of the ambition it's great, and one of the interesting bits of it that is probably more obvious than in, say, the European one, is the cap feedstock for heifer as a as a production pathway. And then others will say well, there's a question around its carbon emissions and its actual how green is it? Lots of critics would say it's not necessarily the greenest of solutions in the SAF space, but putting a cap on it does sort of encourage other production pathways to come and take its place and sort of forge their own ways. And, as we were discussing earlier with the investment side, it does sort of open investors eyes to going OK, well, this isn't necessarily the singular solution. We've got to look at other options as well. So there's many different sort of benefits to sort of putting in these caps or sub mandates within the broader picture it's a it's a very delicate exercise because of course you don't want to put a cap that that makes the whole thing unworkable.

Speaker 2: 38:20

You know, I? I mean I don't know the exact percentage, but definitely by far the largest percentage of EFA is virtuous and really really contributes essentially to SAF and to the reduction in climate change impact from aviation.

Speaker 2: 38:38

So, you don't want to transform this into, you know, satan or anything like that. I mean, it's super. It's the best solution right now. It should be encouraged and the focus should be on the feedstock part. The feedstock part is the part that is shaky. You know, these use cooking oil and things like that. You need to be careful with that part. Once you have secured that this part is truly a biomass or waste, then the rest is absolutely acceptable. I mean, it's a very, very good process. So I think the CAP just sends a message and, as you said, it sends the right message of guys, don't put your eggs all in the same basket. I think that's a good message, um, but it's a it's a delicate, uh. It's a delicate, uh exercise absolutely so.

Speaker 1: 39:32

I mean, we've spoken a lot about policy being a strong driver for you in choosing the uk and for your first refinery Is that have you got plans for projects outside of the UK? Are you actively working on that now or are you sort of waiting to get this first one up and running and then you're going to look at it? And what are the deciding factors about where you would put future, future facilities?

Speaker 2: 40:03

you would put future facilities? Yes, so our ambition, our DNA, has always been to be global. You know all our partners on the supply chain. All of them are global partners. So it's certainly the plan to go way beyond the UK. The way we structured our project is, you know, in a modular approach, meaning we can copy-paste the project that we're building in Sunderland, we can copy-paste it in other jurisdictions very quickly, and then we have one centralized unit to transform the oil into SAF. So it's very easy for us to go global into, into south. So it's very easy for us to to go global.

Speaker 2: 40:46

The decision of the location is mainly linked to same criteria that I was mentioning for for the uk availability of end-of-life tires. So for that europe is a good place, northwest europe at the amsterdam rotterdam androp region, where a lot of end-of-life tires from Europe in general are exported from, and the US, of course, is the main market. So the US is going to be a top priority in the US Gulf Coast. We already have plans for both these two jurisdictions. We have other plans that are less advanced for other parts in the world, but these two we are, we are already developing the early stages so we can implement, uh, quickly I would also suggest you have a look at springfield, um and have a conversation with mr burns.

Speaker 1: 41:36

I'm sure I'd be very interested in putting putting one of your facilities next to their entire pile. Um, thank you so much. That was excellent, really interesting and, yeah, thank you so much for your time thank you oscar.