Pathway Energy proposes 30 mgy SAF plant in Texas, Drax to supply biomass pellets

Photo: Drax Group

Pathway Energy LLC debuted Dec. 12 as a wholly owned subsidiary of Nexus Holdings and announced the first in a series of commercial-scale sustainable aviation fuel (SAF) facilities.

The project, based in Port Arthur, Texas, will be capable of producing 30 million gallons of carbon-negative SAF annually, the equivalent of enough fuel to power 5,000 carbon-neutral long-haul (10-plus hour) flights per year.

Through biomass power, gasification and syngas conversion technologies, Pathway will convert sustainably sourced wood pellets, a homogenous and globally traded commodity, into SAF.

Led by early sustainable fuel pioneers, Pathway said its team has decades of combined experience in waste- and biomass-conversion processes and technologies, including biomass power generation, biomass gasification, Fischer-Tropsch, and complex biorefinery and industrial processes.

Pathway has partnered with multinational heavyweights, including Sumitomo SHI FW, which will supply the project with proven power-production and gasification process-technology packages.

Pathway has also formed a strategic partnership with U.K.-based renewable energy leader Drax Group.

The companies have reached heads of terms on a multiyear deal that could see Drax supply over 1 million metric tons of sustainable biomass pellets each year to Pathway’s proposed SAF plant on the U.S. Gulf Coast.

Under a separate agreement, Drax could also become a strategic partner in the project, with a potential investment in the form of a convertible loan note of up to $10 million.

No investment decision has been taken by Drax at this stage.

Pathway will soon begin front-end engineering design and anticipates that it will begin construction on the $2 billion plant in early 2026.

Following construction, commercial SAF production is expected to begin in 2029.

Both companies also have a strategic interest in bioenergy with carbon capture and storage (BECCS), a carbon removal and renewable power technology.

Pathway intends to develop a BECCS system on the Port Arthur site, which could remove 1.9 million tons of carbon dioxide from the atmosphere each year while powering the SAF facility and ensuring the jet fuel is carbon negative.

In the future, Drax could also potentially supply biomass to two additional Pathway projects, delivering a further 2 million tons of sustainable pellets per year to the business’ sites through the 2030s.

“This landmark deal has the potential to be the biggest third-party supply arrangement Drax’s pellet business has made,” said Drax CEO Will Gardiner. “Demand for sustainable biomass is accelerating, with international businesses seeking long-term fuel supplies for a range of projects globally—including sustainable aviation fuel and bioenergy with carbon capture and storage. Reaching heads of terms on this deal with Pathway is an important step in the energy transition and for decarbonizing the aviation sector through sustainable aviation fuel production, which Drax is proud to be a part of. We also share Pathway’s aim of scaling bioenergy with carbon capture and storage to deliver the carbon removals that the world needs to fight climate change.”

Steve Roberts, CEO and founder of Pathway Energy, added, “This innovative agreement catalyzes our aligned commitment with Drax to decarbonize the aviation industry and establishes the strategic alignment with Drax to deploy additional projects leveraging proven biomass-conversion technologies, sustainable biomass feedstock, and carbon capture and sequestration. With a global scale supply of CORSIA-compliant biomass material, we are well-poised to address one of the hardest-to-abate industrial sectors through the production of carbon-negative sustainable aviation fuels.”

Modeling by the International Air Transport Association expects the global use of SAF to deliver 65 percent of the emissions reductions required for the aviation sector to reach net zero by 2050.