U.S. COMPANIES AND AIR NEW ZEALAND TEST AVIATON BIOFUEL

UNCLAS WELLINGTON 000002

SIPDIS

E.O. 12958: N/A
TAGS: BEXP ENRG TRGY NZUS
SUBJECT: U.S. COMPANIES AND AIR NEW ZEALAND TEST AVIATON BIOFUEL


1. December 30, 2008 Charge represented the Embassy, the Foreign
Commercial Service and the U.S. Government generally at an Air New
Zealand (ANZ) test flight of a new biofuel at Auckland International
Airport. UOP, a U.S. subsidiary of Honeywell, has developed a
biofuel from a tree called jatropha in conjunction with Boeing,
Rolls Royce, and ANZ. In this test, a 50/50 mixture of UOP's
jatropha jet fuel and ordinary petroleum-based jet A fuel powered
one engine on an ANZ 747 during the test flight. After about two
hours of various tests, the engine and fuel were confirmed to
function completely normally. (12/31/08 Embassy press clips, emailed
to EAP/ANP, provide media reporting on the event.)


2. The jatropha tree produces nuts which can be pressed to yield an
oil which is then refined into jet fuel. It is designated a second
generation biofuel because it does not displace any food crops or
forest. The tree grows in semi-arid conditions. It can therefore be
planted in areas of marginal use. Jennifer Holmgren, a chemist and
General Manager at UOP, who represented her company at the test,
said that there were plans to plant jatropha along the edge of the
Gobi in a test to combat desertification.


3. ANZ Chairman Rob Fife told those watching the test that the
airline is now working with UOP, Boeing and Rolls Royce to assess
whether it will be possible to grow jatropha trees and build a
refining capability of sufficient scale to make the use of this
50/50 blend commercially viable. If so, this could be a ground
breaking development. Apparently, jatropha is the only second
generation biofuel that could be commercially available as soon as
the next three to five years.


4. This test was a good reminder of the role that U.S. companies and
their international partners play in combating climate change. It
comes at an interesting moment in the development of alternative
fuels. Other airlines, including Virgin Atlantic and Japan Airlines,
are also engaged in testing biofuels, although ANZ may have the most
ambitious and realistic approach to bringing such fuels on line. In
addition, another NZ company, "Aquaflow Bionomic," announced in
December 2008 that it had developed a process to refine Synthetic
Paraffinic Kerosene (SPK) from wild algae, which could be blended
with Jet A-1 fuel to power jet aircraft. The algae is found in local
sewage oxidation ponds, and the company used a technology also from
UOP. Second, December 22, 2008 New Zealand's new National Government
passed through the Parliament a bill repealing the Biofuels
Obligation Act (BOA),which the Labour Government had passed just
prior to the November 2008 national elections. The law would have
required the introduction of vehicles in New Zealand to be powered
with a blend of biofuels with petrol and diesel effective October 1,
2009.