KeyState, CNX Advancing Transformational Hydrogen and Sustainable Aviation Fuel Hub at Pittsburgh International Airport

Proposed facility will help catalyze hydrogen and sustainable aviation fuel industries at scale, propel the aviation sector's decarbonization goals, lower transportation costs, and create supply chain efficiencies

PITTSBURGH, May 15, 2024 /PRNewswire/ -- To accelerate regional and national hydrogen and sustainable aviation fuel (SAF) development, KeyState Energy (KeyState), CNX Resources Corp. (NYSE: CNX), and Pittsburgh International Airport (PIT) today announced a collaboration to bring yet another transformational project to PIT property.

The integrated facility can produce hydrogen solely, reaching up to 68,000 metric tons annually, or SAF exclusively, up to 70 million gallons per year. The plant will offer the flexibility to produce both products simultaneously at lower varying individual volumes and customize production to meet specific demands. Building upon CNX and PIT's previously announced alternative fuel strategy in 2022, this initiative supports the national goal of significantly reducing hard-to-abate sectors' emissions by 2030, positioning the region as a key player in the hydrogen and sustainable aviation fuel industries.

KeyState and CNX recently signed a Letter of Intent (LOI) to advance the approximately $1.5 billion project that, if the U.S. Department of Treasury enables a pathway for ultra-low carbon intensity fugitive coal mine methane (CMM) under the 45V Hydrogen Production Tax Credit, is expected to support 3,000 direct construction jobs through the development phase. The partners are evaluating several potential market targets for the usage of SAF in the aviation industry and clean hydrogen for local heavy trucks and equipment, and power generation, among other applications for hard-to-abate sectors of the economy.

"Because of this exciting new project, Pittsburgh International Airport will become home to one of the largest facilities in the Nation that specializes in the innovative process of using hydrogen gas to produce sustainable aviation fuel," said Senator Bob Casey (D-PA). "It will help support thousands of new union jobs and provide a look at how cutting-edge innovation in Pennsylvania is helping to build the energy economy of the future."

"As the only state to secure two regional clean hydrogen hubs, the future of clean energy is running through Pennsylvania, and as we build out these hydrogen hubs over the next several years, we'll see more innovation, job creation, and opportunity coming to our Commonwealth," said Pennsylvania Governor Josh Shapiro. "We're proving that you don't have to choose between protecting the planet and protecting jobs – and the partnership between KeyState Energy, CNX Resources, and Pittsburgh International Airport will create thousands of jobs and cut fuel costs for airlines, all while reducing pollution and making our communities safer and healthier. My Administration will continue to bring people together to drive innovative projects to the Commonwealth that reduce emissions, tackle climate change, and create family sustaining jobs."

Allegheny/Fayette Central Labor Council, AFL-CIO President Darrin Kelly said, "This project is the economic shot in the arm the region needs and I'm proud of the diverse coalition working to make Pittsburgh the leader in hydrogen and sustainable aviation fuel. The commitment by our coalition to work together to ensure that the men and women of our regional union workforce lead the way on the jobs associated with these new sectors of the economy is exactly what we need more of – labor, business, and government finding ways to tear down old narratives and move our region forward. This would be the most significant energy project the region has seen in years, and it can help trigger a broader transformation and position us for a lower carbon future. We will continue our advocacy to ensure the forthcoming hydrogen and SAF tax credit rules provide western Pennsylvania the opportunity to bring this project and our vision to fruition."

Produced from a variety of sources, including waste feedstocks, SAF can drastically reduce the lifecycle carbon emissions of air travel, making it the best decarbonization lever available to the aviation industry to reach net zero. However, due to production and cost issues, SAF currently accounts for less than one percent of global commercial airline consumption. A facility of the proposed size and scope would produce enough alternative fuel to supplant nearly all traditional jet fuel consumption at PIT at a price on par with conventional Jet A.

Mixing just 10 percent SAF with regular jet fuel can power thousands of flights annually, significantly reducing emissions. The integrated facility further positions PIT as an industry leader, making it even more attractive for passenger and cargo flights.

A 2021 study from the U.S. Department of Energy's National Energy Technology Laboratory (NETL) confirmed that constructing and operating a gas-to-liquids SAF facility at PIT is technically feasible through the use of onsite natural gas production and net-zero or net-negative greenhouse gas emissions feedstocks to produce sustainable aviation fuel.

Additionally, the groups announced they are seeking a federal grant to conduct a logistics study to inform a project hub and transportation network investment strategy. Using FAST SAF grant funds under the Inflation Reduction Act (IRA) and awarded by the Federal Aviation Administration, the Tier 1 logistics study would advance local SAF development by informing how fuels produced at PIT can be cost-effectively transported to nearby airports throughout the Northeast and Midwest. The entities plan to evaluate transporting SAF through various modes, including the use of existing or constructing new pipeline infrastructure, barge, and rail. Providing excess SAF to other regional airports will increase energy security, reduce dependence on foreign supply chains, and reduce lifecycle greenhouse gas emissions.

Successful completion of the logistics study could yield significant investment in constructing the hydrogen and SAF facility on PIT grounds, which would double onsite fuel storage and further stabilize fuel supply in the event of disruptions.

"This exciting project opens the door for Western Pennsylvania to lead the nation in sustainable aviation fuel—and that could be a big win for our workers, local economy, and efforts to cut emissions and meet new energy standards," said Congressman Chris Deluzio (D, PA-17). "I am proud that my office is supporting federal grants that will help this venture get off the ground and start using cleaner aviation fuel as soon as possible." 

Allegheny County Chief Executive Sara Innamorato said, "I'm very pleased that Pittsburgh International Airport, KeyState Energy, and CNX Resource are bringing this transformational collaborative project to Allegheny County. Our region should be out front on more sustainable options for hard-to-abate sectors like aviation fuel industries. The onsite potential for a SAF facility on PIT's campus will create jobs and help our region lead on climate solutions for the energy sector."

"For more than 300 years, Pennsylvania and Appalachia have lived and led America's energy transitions; first from wood to coal, then oil was added, then natural gas added, then nuclear, then the shale gas revolution and now the beginning of a next energy revolution, this in clean hydrogen," said Perry Babb, CEO of KeyState Energy. "The innovations contemplated for the PIT hydrogen and SAF Hub have the potential to produce the lowest-carbon, lowest-cost, large-scale aviation fuel in the world."

Commencing in 2014, the innovative partnership between PIT and CNX has helped transform the Pittsburgh region's economic development hub into one of the most sustainable and resilient airports in the world. Innovations include development of a first-of-its-kind microgrid making PIT the first airport in the world to be completely powered by natural gas and solar energy. 

"Pittsburgh is once again leading the way on energy toward a more sustainable future," said Pittsburgh International Airport CEO Christina Cassotis. "Increasing SAF and hydrogen production in the U.S. is a necessary first step in reducing carbon output to meet upcoming industry goals, helping aviation earn its right to grow and moving further toward a cleaner, greener future. We look forward to continuing to work with our partners, CNX and KeyState Energy, in cementing Pittsburgh International Airport and our region as a global leader in sustainable energy."

The project would leverage, pending the outcome of forthcoming U.S. Department of Treasury implementation rules for the IRA's tax credit provisions, ultra-low carbon intensity waste CMM emissions as feedstock to create low-cost, low-carbon alternative fuels. As part of the project's development, the partners intend to clarify that the products meet the requirements and specifications for clean hydrogen and SAF as determined by the applicable agency.

KeyState serves as project developer and, with its development partners, will secure project financing while CNX will provide feedstock services and other technical engineering support to the project. The airport will provide strategic advisory planning and industry expertise.

"First and foremost, we would not be in position to announce this project without the support and advocacy of our western PA labor leaders, and we are not going to proceed without them on this or any other hydrogen or SAF project in the region. Our goal is to expand end-use opportunities of our abundant, ultra-low carbon intensity natural gas to drive further emission reductions, create good paying, local jobs, and enhance PIT's position as an innovative sustainable fuel hub," CNX President and CEO Nick Deiuliis said. "Our decade-long partnership with PIT has contributed to the airport's international profile as a pioneer in the industry and we look forward to taking the next step together in catalyzing a first-of-its-kind, large scale hydrogen and sustainable aviation fuel hub right here in the Pittsburgh region."

The Allegheny Conference on Community Development recently completed an analysis of CMM as a pathway to a hydrogen economy in the Southwestern Pennsylvania region. The findings identified over 30 projects that can be deployed within the next 15 years if the full IRA tax credits can be utilized potentially creating over 200,000 direct construction jobs and more than $213 billion in economic output.

Allegheny Conference on Community Development Chief Growth Officer and Vice Chair of the Allegheny County Airport Authority Board of Directors Matt Smith said, "Establishing a hub for hydrogen and sustainable aviation fuel at the Pittsburgh International Airport is a transformational milestone in our energy and transportation future, and I commend the public, private and labor leaders involved in bringing this opportunity to fruition. Robust partnerships and our world-class innovation ecosystem keep Pittsburgh at the forefront of what's next, and we are strongly advocating for the policies, including updates to the federal 45V Clean Hydrogen Production Tax Credit guidance, required to open up this generational opportunity for new jobs and catalyze a low-carbon intensity hydrogen economy for our region. The full potential of this opportunity for the Pittsburgh region is dependent on smart and thoughtful decisions by policymakers."

Dozens from Pennsylvania's labor and business community, as well as local elected officials also shared their support for the project. Read what they're saying at www.safpittsburgh.com/commentary. 

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About KeyState Energy
KeyState Energy is a privately held Development Company of large-scale, energy and manufacturing projects, which have both dramatic emission reduction impacts and generational job and economic impacts. This is accomplished through a proprietary integration of innovative natural gas extraction, which avoids 99% of fugitive methane emissions, combined with the separation, capture and geological sequestration of 99% of the CO2 in the natural gas feedstock. The result is products meeting the most stringent requirements for Qualified Clean Hydrogen, with uses including mobility and aviation fuels, fertilizers, critical chemicals, and power. KeyState Energy is Developer of KeyState Natural Gas Synthesis, in Clinton Co. Pa., a part of the ARCH2 Hydrogen Hub, and of KeyState-Virginia, in Wise, County, Va. with additional project announcements forthcoming. www.KeyState.net

About CNX
CNX Resources Corporation (NYSE: CNX) is unique. We are a premier, ultra-low carbon intensive natural gas development, production, midstream, and technology company centered in Appalachia, one of the most energy abundant regions in the world. With the benefit of a 160-year regional legacy, substantial asset base, leading core operational competencies, technology development and innovation, and astute capital allocation methodologies, we responsibly develop our resources and deploy free cash flow to create long-term per share value for our shareholders, employees, and the communities where we operate. As of December 31, 2023, CNX had 8.74 trillion cubic feet equivalent of proved natural gas reserves. The company is a member of the Standard & Poor's Midcap 400 Index. Additional information is available at www.cnx.com.

About Pittsburgh International Airport
Pittsburgh International Airport (PIT) serves approximately 10 million passengers annually and is a key economic driver for the region, reflecting and serving the community, inspiring the industry, and advancing the region's role as a world leader. PIT's new terminal, scheduled to open in 2025, will transform the passenger experience and showcase the region's thriving economy as its new front door. PIT has recently won numerous international awards including being named by Fast Company magazine as One of the Most Innovative Companies in the World as well as a finalist in Accessible Design. Future Travel Experience named PIT a winner in its Pioneer innovation awards, and PIT's first-of-its-kind microgrid has garnered numerous accolades for resiliency and sustainability. For more information visit www.flypittsburgh.com.

SOURCE CNX Resources Corporation; Pittsburgh International Airport; KeyState Energy