Shell has decided not to go ahead with two projects it was studying to produce biofuels and base oils in Singapore, a company spokesman said on Thursday.
“We can confirm that we are halting exploration for two projects: a biofuels unit and a Group II base oil plant in Singapore,” the company told Reuters in an emailed statement.
“We will continue to supply base oil and lubricants, as well as biofuels, to our customers in Singapore and the region.”
Shell announced in late 2021 that it was studying a 550,000 tonne-a-year project on Singapore’s Bukom Island to produce sustainable aviation fuel (SAF) to supply major Asian hubs such as Hong Kong International Airport and the Singapore Changi.
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The company planned to make a final investment decision for the project in early 2023.
Unlike in Europe and the United States, there is no mandate for airlines to use SAF, an industry source said, adding that customers were unwilling to accept higher fuel costs.
Aviation, which accounts for 3% of the world’s carbon emissions, is one of the most difficult forms of transport to decarbonize.
