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Sustainable fuels technology company Velocys plc (LON: VLS) and British Airways have agreed to extend the current option agreement for the Altalto project by one year to 31st March 2022.
Velocys shares have gained 3.83% following the news, priced at 6.24p.
If the option is exercised, it will give both parties equal equity ownership (50/50) of Altalto Ltd and the right to appoint a Director.
Velocys also welcomed the UK Government’s announcement of the launch of a new £15m ‘Green Fuels, Green Skies' grant funding competition.
The funding is intended to support the production of Sustainable Aviation Fuel. Altalto will apply for a grant in this competition, on behalf of Velocys and British Airways, with the competition's results expected to be announced on 31st July.
The company expects the project will be in a position to launch its front-end engineering design (FEED) later in 2021, subject to confirmed UK Government policy support and the addition of new investment partners in the project.
“Our announcement today reflects the strength of our partnership and commitment to the project,” commented Henrik Wareborn, CEO of Velocys.
“SAF remains critical to the decarbonisation of aviation; it is applicable to all flights including long-haul and can be used immediately with no need for modifications to aircraft fleets or refuelling infrastructure. Velocys has the technology to enable the production of SAF from wastes, avoiding landfill or incineration, and our technology can be coupled with Carbon Capture and Storage (CCS) to achieve net zero fuels,” added Wareborn.
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