UOB extends Bangchak group THB6.5 billion loan for Thailand’s first SAF plant 

This deal marks the first Transition Finance facilities for the hard-to-abate sector in Thailand.

The project is designed to produce SAF from used cooking oil, marking a key milestone in the country’s transition to sustainable energy solutions. The SAF project is part of Bangchak’s strategic plan to advance low-carbon businesses and sustainable innovations with the potential to substantially generate a positive change in the Oil & Gas industry.  

Ms Panitsanee Tansavatdi, Head of Corporate Banking, at UOB Thailand, said “This transaction will continue to affirm UOB’s comprehensive support for Bangchak group while asserting our position as the primary relationship bank for supporting the group in key strategic areas related to their sustainability and energy transition plan. We are proud to be part of Bangchak’s pioneering SAF project, the first-ever in Thailand.  

Through the Bank’s Transition Finance Framework, UOB can support a wide range of transition activities for the abate segment, including the production of low-carbon alternative fuels, enhancements in operational efficiency, Carbon Capture and Storage (CCS) and Carbon Capture Utilisation and Storage (CCUS) and participation in voluntary carbon credit programmes. It will greatly benefit the production of SAF, a sustainable fuel which would contribute to the decarbonisation of the aviation sector.”

The facility is structured to provide carbon credit rebates to support Bangchak’s own decarbonisation goal – the first of its kind for UOB. 

Phatpuree Chinkulkitnivat, Chief Financial Officer and Senior Executive Vice President of Accounting and Finance, at Bangchak Corporation PLC, said “This project reflects Bangchak’s effort to reduce GHG emissions and transition our businesses towards carbon neutrality in 2030 and Net Zero in 2050. The partnership has enabled us to put our decarbonisation plan into action. We truly appreciate UOB’s commitment to supporting us along our sustainable journey.”

SAF is made from sustainable resources that can be blended with conventional jet fuel to reduce emissions. The project takes advantage of Bangchak’s integrated value chain, with the ability to procure used cooking oil from Bangchak's nationwide service stations and its partnership networks.

The SAF output will be offloaded to Bangchak as the primary trading/marketing entity and supplied to customers such as fuel suppliers, airlines, and oil traders. Notably, Bangchak recently signed an offtake agreement with Shell International Eastern Trading Company in Singapore. 

Bangchak, a leading player in Thailand’s energy sector, is a Thai pioneer in producing SAF from used cooking oil. Through its subsidiary BSGF Co., Ltd, Bangchak has invested 8.5 billion baht in the development of SAF production at its Phra Khanong refinery in Bangkok, which is expected to commence operations by the second quarter of 2025, with a production capacity of one million litres per day. Using SAF will help reduce GHG emissions by approximately 80,000 tons of carbon dioxide equivalent compared to conventional jet fuel.         

BSGF represents a joint venture between Bangchak and BBGI PCL to build and operate Thailand’s first SAF production plant, in light of the growing demand for low-carbon solutions in a traditionally carbon-heavy industry. The venture is 80 per cent owned by Bangchak and 20 per cent owned by BBGI.

Bangchak has diversified its business from oil refineries and petrol stations to renewable energy generation and battery storage, as part of its green transition towards a low-carbon society.