Emirates said its latest SAF deal represents the largest volume of the alternative fuel to be used by a Middle East and African airline. Photo: Emirates
Emirates said its latest SAF deal represents the largest volume of the alternative fuel to be used by a Middle East and African airline. Photo: Emirates
Emirates said its latest SAF deal represents the largest volume of the alternative fuel to be used by a Middle East and African airline. Photo: Emirates
Emirates said its latest SAF deal represents the largest volume of the alternative fuel to be used by a Middle East and African airline. Photo: Emirates

Emirates expands Neste partnership for supply of sustainable aviation fuel


Deena Kamel
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Emirates has expanded its partnership with Finnish biofuel producer Neste for the supply of 3 million gallons of sustainable aviation fuel (SAF) in 2024 and 2025, as the airline strives to reduce its carbon footprint.

The deal underpins the largest volume of SAF so far to be used by any Middle East and African airline, Emirates said on Wednesday.

The SAF will be blended with conventional jet fuel to power Emirates’ flights departing from Amsterdam Schiphol and Singapore Changi airports.

The agreement with Neste “represents the acceleration of SAF procurement for our operations”, Tim Clark, Emirates airline's president, said.

“We hope that the robust demand coming from Emirates and other airlines encourages the scaling up of SAF and other emerging clean propulsion technologies.”

The move comes as the world's biggest airline, and the largest operator of Airbus A380s and Boeing 777 wide-bodies, is increasing its use of alternative fuel.

Emirates in January partnered with Neste – alongside GE Aerospace, Boeing and Honeywell – to complete the first SAF-powered demonstration flight in the region, using a Boeing 777-300ER operating on 100 per cent SAF in one engine.

Earlier this month, Emirates signed an agreement with Shell Aviation for more than 300,000 gallons of blended SAF for use at its hub in Dubai for the first time.

In May, Emirates said it has allocated $200 million to fund research and development projects focused on advanced fuel technology that can reduce the environmental effect of commercial aviation.

The use of SAF on Emirates flights is among several other initiatives to reduce carbon emissions, which include operating fuel-efficient aircraft, stepping up its fleet renewal from 2024 and driving fuel efficiency, Mr Clark said.

“Sustainable aviation fuel is a readily available solution for reducing the greenhouse gas emissions from air travel,” Alexander Kueper, vice president for Europe and the Middle East at Neste's renewable aviation business unit, said.

“We are ramping up our global SAF production and continue to support their commitment to reduce emissions.”

SAF, which refers to alternative fuels made from renewable sources that are used to power aircraft, is crucial for the global aviation industry to reach its net-zero goal by 2050.

However, its adoption is still in the early stages due to small-scale production and its higher cost, compared with conventional fuel.

The International Air Transport Association estimates that SAF could contribute about 65 per cent of the reduction in emissions needed by the aviation industry to reach its net-zero emissions aim by the middle of the century.

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HIV on the rise in the region

A 2019 United Nations special analysis on Aids reveals 37 per cent of new HIV infections in the Mena region are from people injecting drugs.

New HIV infections have also risen by 29 per cent in western Europe and Asia, and by 7 per cent in Latin America, but declined elsewhere.

Egypt has shown the highest increase in recorded cases of HIV since 2010, up by 196 per cent.

Access to HIV testing, treatment and care in the region is well below the global average.  

Few statistics have been published on the number of cases in the UAE, although a UNAIDS report said 1.5 per cent of the prison population has the virus.

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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Cast: Vicky Kaushal, Akshaye Khanna, Diana Penty, Vineet Kumar Singh, Rashmika Mandanna

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Updated: October 18, 2023, 11:13 AM