Indian Oil Corporation (IndianOil) has approved plans to enter the sustainable aviation fuel (SAF) segment through a new joint venture that will develop a dedicated production facility at Paradip in Odisha, marking a significant step in India's efforts to build a domestic low-carbon aviation fuel ecosystem.
The company’s board has cleared the formation of a 50:50 joint venture with M11 Energy Transition Private Limited to establish a 100 kilo tonnes per annum (KTPA) Hydroprocessed Esters and Fatty Acids (HEFA)-based Sustainable Aviation Fuel plant. The decision was approved during a board meeting held on 18 May 2026.
The proposed project carries an estimated cost of Rs 10,636 million, with a tolerance band of plus or minus 30 per cent. According to company disclosures reported by Construction World, the proposal remains subject to statutory approvals as well as clearances from NITI Aayog and the Department of Investment and Public Asset Management (DIPAM).
The project represents IndianOil’s first major dedicated investment in sustainable aviation fuel production and aligns with the company’s broader energy transition strategy.
SAF has emerged as one of the aviation industry's most important pathways to reducing lifecycle carbon emissions, particularly as airlines and governments worldwide seek alternatives to conventional fossil-based jet fuel.
Under the approved structure:
• IndianOil and M11 Energy Transition will each hold a 50 per cent equity stake in the venture.
• The facility will produce sustainable aviation fuel using HEFA technology, one of the most commercially established SAF production pathways globally.
• Feedstocks will include vegetable oils and other suitable lipid-based raw materials that can be processed into jet-grade fuel meeting aviation standards.
IndianOil said the project is intended to support the development of low-carbon aviation fuels while strengthening domestic energy security and reducing dependence on conventional aviation fuel sources.
The proposed facility will be located at Paradip, where IndianOil already operates one of its major refinery complexes.
According to details of the project, the site was chosen for several logistical advantages, including access to feedstock supplies, port infrastructure and integration opportunities with existing refinery operations.
The location is expected to support efficient transportation, storage and processing activities while reducing additional logistics costs associated with SAF production.
The project has also been designed to leverage existing supply chain infrastructure to improve operational efficiency and streamline fuel distribution.
The planned plant will use Hydroprocessed Esters and Fatty Acids (HEFA) technology, currently one of the most widely deployed methods for producing sustainable aviation fuel.
HEFA-based SAF is created by processing lipid feedstocks into fuel that can be blended with conventional jet fuel and used within existing aircraft and airport infrastructure.
Industry experts regard HEFA as a mature SAF pathway because it can produce fuel compatible with current aviation engines without requiring major modifications to aircraft systems.
For India, expanding domestic HEFA capacity could help support future SAF blending requirements while reducing reliance on imported sustainable fuel supplies.
The project comes as aviation stakeholders worldwide face mounting pressure to lower emissions from air transport.
IndianOil stated that the facility will contribute to its energy transition objectives while supporting broader national efforts to reduce greenhouse gas emissions from transportation fuels.
Key project highlights include:
• 100 KTPA sustainable aviation fuel production capacity.
• Estimated project investment of Rs 10,636 million.
• Equal ownership structure between IndianOil and M11 Energy Transition.
• Integration with existing refinery and logistics infrastructure at Paradip.
• Focus on domestically produced low-carbon aviation fuel.
The venture also aligns with increasing global interest in SAF as airlines seek scalable solutions to meet long-term sustainability targets.
While the board approval marks a significant milestone, the project still requires multiple regulatory clearances before a final investment decision can be taken.
IndianOil has indicated that project studies, statutory approvals and government clearances will determine the timeline for implementation.
As India seeks to expand its sustainable fuel capabilities and reduce aviation emissions, the Paradip project could become an important building block in the country's emerging SAF supply chain. If approved and executed as planned, the facility would strengthen domestic production capacity while supporting the aviation sector's transition towards cleaner and more sustainable operations.
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