Arizona-based USA BioEnergy has acquired more than 1,600 acres of East Texas land where it intends to build a $2.8 billion biorefinery, converting wood waste into sustainable aviation fuel (SAF), the company said Jan. 12.

The aviation sector is counting on SAF to lower emissions. However, the fuel—which can be produced with a variety of feedstock that include used cooking oil and waste—is in short supply and remains more expensive than fossil-based jet fuel. With economies of scale, prices are expected to fall as more producers bring projects online.

“This advanced-fuels facility development milestone underscores USA BioEnergy’s commitment to the future of aviation and energy security,” said Nick Andrews, CEO of USA BioEnergy. “It bolsters our goal of being the world’s leader in advanced fuels.”

The planned facility will be located in Bon Weir, Texas, and will initially occupy about 300 acres. The facility is being developed by USA Bioenergy subsidiary Texas Renewable Fuels with support from state, country and federal credits and tax incentives, USA BioEnergy said in a news release. The project is currently in the detailed design and engineering phase.

Plans are to annually convert 1 million tons of forest thinnings into 65 million gallons of net-zero transportation fuel, including SAF and renewable naphtha. The plant will also have a carbon capture and storage system, aiming to sequester more than 50 million metric tons of CO2 during the facility’s lifetime.

USA BioEnergy has already sealed a 20-year offtake agreement with Southwest Airlines for up to 680 million gallons of neat SAF from the facility. When blended with conventional jet fuel, the SAF could produce the equivalent of 2.59 billion gallons of net-zero fuel and avoid 30 million metric tons of CO2 over the offtake agreement term, the biofuels company said.

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