SK Energy to supply 20,000 tonnes of SAF to Cathay Pacific

South Korean energy company SK Energy announced that it has signed an agreement with Hong Kong based Cathay Pacific to supply 20,000 tonnes of sustainable aviation fuel (SAF).

The contract builds upon previous agreement between the two companies. SK Energy has been supplying SAF to the airline since November 2024. The new agreement will last until 2027.

Last year, SK Energy began commercial completed construction on the site for production of 100,000 tonnes of SAF per annum. The company began commercial production of SAF using the co-processing method. SK plans to use bio-feedstocks with traditional oil refining processes to simultaneously produce both petroleum and low-carbon products, including SAF.

At the time, the company said it is in plans to further expand SAF production.

SK Energy has secured multiple certifications to support SAF production and sales, including ISCC CORSIA, ISCC EU, and ISCC PLUS.

Global demand for SAF has been steadily increasing since the International Air Transport Association (IATA) passed a resolution in 2021 to reduce the aviation industry’s carbon emissions by 50% compared to 2005 levels by 2050.

In response, the EU mandated all flights departing from Europe to use a minimum of 2% SAF in their fuel mix. This requirement will rise to 6% by 2030 and 70% by 2050. The UK has a similar mandate. Meanwhile, the US also set a target to replace all conventional jet fuel with SAF by 2050.

Also in the APAC region, Singapore will implement a SAF levy with a 1% SAF usage target in 2026 and South Korea will implement a 1% blending SAF mandate in 2027.

Other Asian countries such as Japan, India and Indonesia are also mulling mandates.

South Korea aims to establish SAF usage targets by the second half of this year in preparation for a mandatory SAF blending requirement in 2027.

Last August, the Ministry of Trade, Industry, and Energy and the Ministry of Land, Infrastructure, and Transport announced that starting in 2027, the use of SAF blends would be mandatory for all international flights departing from South Korea.

“We will closely monitor changes in SAF policies and market dynamics both domestically and abroad. By collaborating with Cathay Pacific and other partners, we aim to build a stable global SAF supply chain,” said Lee Young-chul, head of SK Energy’s Marketing Division.