Gevo signs heads of agreement with Lufthansa for supply of renewable jet fuel

Biofuels producer Gevo has entered into a heads of agreement with German airline Deutsche Lufthansa to supply Gevo’s alcohol-to-jet (ATJ) fuel.

The fuel will be produced at Gevo’s first commercial hydrocarbons facility, intended to be built in Luverne, Minnesota, US.

The terms of the agreement contemplate Lufthansa purchasing up to 8 million gpy of ATJ from Gevo, or up to 40 million gallons over the five-year life of the off-take agreement.

The heads of agreement establishes a selling price that is expected to allow for an appropriate level of return on the capital required to build-out the Luverne facility.

The agreement is non-binding and is subject to completion of a binding off-take agreement and other definitive documentation between Gevo and Lufthansa, expected to be completed in the next few months.