The Offtake Gap Nobody Talks About
Izabela Santos
Founder and Managing Director
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StratX - SAF & Clean Fuels Commercial Advisory
Most SAF projects that fail to reach FID do not fail because of the technology. They fail because of the commercial structure. Which was either not engineered correctly, or was never structured to meet lender requirements in the first place.
I am currently inside a live SAF offtake negotiation, and what I see from that position is consistently different from what gets discussed at conferences.
Here is what actually happens in practice.
A developer secures a technology partner, a site, and a pathway. The need to secure further development capital, and to do that, they need an offtake. They begin offtake conversations with airlines. The airline sends a term sheet, the developer responds, and both sides spend six to nine months going back and forth on pricing, volume, tenor, and indexation. Eventually something gets signed.
Then it goes to the lender, and the lender says no.
Not because the project is wrong, but because the offtake agreement was negotiated between two parties who each had their own interests, and nobody in the room was working from the lender's checklist. The pricing mechanism does not provide sufficient revenue certainty. The volume commitment has too many off-ramps. The tenor is two years short of what debt serviceability requires. The revenue stacking is not designed correctly. The credit support structure does not meet the threshold the lender needs to underwrite. Everything that needed to be solved before the negotiation started gets discovered after it finishes.
This is the single most expensive and most avoidable problem in SAF project finance, and it is still almost universal.
The facilitator gap
There is a specific friction point I have observed recently that rarely gets named directly.
Project developers typically enter offtake negotiations without a clear understanding of what they are actually trying to structure. They know they need an offtake agreement. They do not always know what terms a lender will require that agreement to contain, or how to present their project in language that an airline procurement or finance team will respond to. They are not speaking the offtaker's language, and they are not working from the lender's framework. The result is months of circular conversation, repeated redrafts, and mounting frustration on both sides, with neither party clear on what a workable agreement actually looks like. As a result, if you are lucky enough, you will have an agreement, but most likely that agreement will not get the project to FID.
Most developers want to manage this process themselves. The instinct is understandable, but the expertise required to structure a bankable offtake is specific and it is not the same expertise needed to build the project. Without it, negotiations stall, relationships wear thin, and projects that had genuine potential quietly die before they ever reach a financing conversation.
A facilitator who understands what lenders will accept, what airlines can realistically commit to, and where genuine flexibility exists on both sides would shorten these negotiations considerably and produce agreements that survive due diligence. That role currently does not exist in most processes, and it should be a standard feature of every SAF offtake negotiation.
What lenders are actually focused on in 2026
From my current position in a live negotiation, here is what is determining lender confidence right now.
Revenue visibility is the controlling variable. Lenders do not need a perfect offtake. They need a structure where downside scenarios still produce revenue sufficient to service debt. That means pricing mechanisms need to include a floor, not just a reference price, and volume commitments need to be firm over the tenor that matters for debt.
Counterparty credit is under more scrutiny than it was eighteen months ago. An MoU with a mid-size airline is not a bankable offtake. A signed agreement with a carrier whose balance sheet a lender is comfortable underwriting is a different conversation entirely. Developers need to understand this distinction before they decide which airline to prioritise in their negotiations.
Feedstock and certification risk is increasingly being priced into the commercial structure. ISCC or RSB certification is no longer assumed. Lenders want to see it secured, or a clear contractual path to it, and they want to understand what happens to pricing if certification is delayed or suspended. Most offtake agreements do not address this adequately.
What this means in practice
If you are a developer with an offtake conversation in progress, the question worth asking is whether your agreement is being built around the airline relationship or around what a lender will actually fund. Those are not the same document.
If you are an investor assessing a SAF project at pre-FID stage, the offtake agreement is where commercial risk is either contained or concealed. The pricing mechanism, the volume commitment structure, the credit support provisions, and the termination rights will tell you more about whether this project reaches financial close than the technology stack will.
If you are an airline being asked to sign a long-term SAF offtake, your internal approval process will stall if the agreement does not resolve cost allocation, volume flexibility, and delivery risk. These are not legal questions. They are commercial structure questions that should be resolved before the lawyers draft anything.
The gap between what gets negotiated and what lenders will actually fund is where most SAF projects currently sit. It is fixable, but only if it is addressed before the term sheet is finalised.
Izabela Santos is the Founder and Managing Director of StratX, a specialist SAF & Clean Fuels commercial advisory. StratX works with developers, investors, airlines, and law firms on offtake structuring, bankability, and FID readiness.