A biofuel company backed by the family office of tycoon Peter Lee Ka-kit will invest HK$10 billion (US$1.3 billion) in sustainable aviation fuel (SAF) production plants in the Greater Bay Area, a project that Hong Kong’s leader has hailed as a “milestone” collaboration between the city and mainland China.

EcoCeres, a Hong Kong-based renewable fuel producer backed by the tycoon – who is also chairman of Henderson Land Development and chairman of Towngas – unveiled on Tuesday plans to build an SAF plant in Dongguan as part of a green energy push in the Greater Bay Area over the next five to 10 years.

Chief Executive John Lee Ka-chiu said the venture represented joint efforts by the Hong Kong and Dongguan governments to align with Beijing’s 15th five-year development plan between 2026 and 2030.

He described it as “a milestone” and “an excellent example of synergy of the two places”.

“Hong Kong brings global finance, professional services and research capabilities. Dongguan brings mature chemical industry parks, logistics and a steady supply of used cooking oil – the essential raw material for SAF,” the city leader said. “Together, we form a powerful combination.”

SAF is a renewable fuel produced from waste materials such as used cooking oil and agricultural waste that reduces life cycle emissions by up to 80 per cent compared with conventional fuel. It is a drop-in fuel substitution, which means it can be safely blended with conventional jet fuel and used in aircraft engines without modification.