Lee Young-chul (left), senior vice president of the marketing department at SK Energy, shakes hands with Alex McGowan, chief operations and service delivery officer at Cathay Pacific Airways, after a partnership signing event held at the airline's headquarters in Hong Kong earlier this month. (SK Energy)
Lee Young-chul (left), senior vice president of the marketing department at SK Energy, shakes hands with Alex McGowan, chief operations and service delivery officer at Cathay Pacific Airways, after a partnership signing event held at the airline's headquarters in Hong Kong earlier this month. (SK Energy)

Korean oil refiner SK Energy announced Tuesday that it recently signed a comprehensive partnership with Hong Kong-based airline Cathay Pacific Airways to promote the expansion of its sustainable aviation fuel exports.

The partnership explores the potential supply of SAF for cargo planes in addition to its current use in passenger aircraft, and considers exporting the fuel for use at overseas airports, according to SK Energy.

The agreement builds on an earlier deal under which SK Energy committed to supplying over 20,000 tons of SAF to Cathay Pacific for flights departing from Korea’s Incheon Airport through 2027. Deliveries began in November, though the financial details of the deal have not been disclosed.

SK Energy stated that its collaboration with Cathay Pacific is expected to serve as a bridgehead for expanding SAF exports to the Asia-Pacific region, which accounts for more than 80 percent of Korean refiners’ exports.

Before its partnership with Cathay Pacific, SK Energy secured its first-ever SAF export deal with multiple European airlines in January, supplying fuel for use at local airports.

SK Energy produces SAF at its Ulsan plant, where it completed a biomaterial refining facility in September capable of producing 100,000 tons of low-carbon products annually.

The global SAF market has been growing steadily since the International Air Transport Association set a target in 2021 to reduce the aviation industry’s carbon emissions by 50 percent compared to 2005 levels by 2050.

In alignment with this goal, the European Union has mandated that at least 2 percent of fuel for departing flights consist of SAF, with plans to increase this share to 70 percent by 2050. South Korea and the United States also aim to transition aviation fuels toward SAF.

According to market researcher Global Market Insights, the global SAF market is projected to grow at an annual rate of 46.2 percent, reaching $74.6 billion by 2034.

“While closely monitoring domestic and international SAF regulations as well as market conditions, including demand fluctuations, we will continue collaborating with strategic partners like Cathay Pacific Airways to establish a stable global SAF supply chain,” said Lee Young-chul, head of the marketing department at SK Energy.

By Lim Jae-seong (forestjs@heraldcorp.com)