Representative Image of an innovative laboratory converting carbon dioxide into sustainable synthetic fuels and consumer products (AI-generated image)
Air Company, the New York startup founded by Gregory Constantine and Stafford Sheehan in 2017, set out to demonstrate how carbon dioxide could be converted into useful products. In February 2023, the US Department of Defense’s Defense Innovation Unit announced a contract with a ceiling of $65 million to develop synthetic-fuel production technology for use in contested environments. AIRCO, as the company is now known, cited a $67 million contract for the same project in a March 2026 announcement. On February 28, 2023, the Defense Innovation Unit announced that it had awarded Air Company a contract with a ceiling of $65 million under Project SynCE, short for Synthetic Fuels for the Contested Environment. The $65 million figure is a contract ceiling, not a guarantee that the government will pay the full amount. On March 10, 2026, AIRCO announced development of its MAD Fuel System, a containerised platform intended to produce synthetic fuels at or near the point of use. AIRCO’s March 2026 announcement cited a $67 million Defense Innovation Unit contract through Project SynCE. The same announcement described approximately $70 million in work involving multiple US government offices, including a new $15 million Strategic Funding Increase award from AFWERX, the US Air Force’s innovation organisation. The public figures do not clearly explain how the $65 million ceiling announced in 2023 relates to the later $67 million figure, or precisely how the approximately $70 million total is calculated.
They should therefore be reported separately rather than added together or presented as a reconciled funding total. It represents the maximum value announced for the contract rather than confirmation of money already disbursed or fuel already delivered at commercial scale.
The project aims to develop technology that can produce synthetic fuels close to where they are needed, according to the Defense Innovation Unit’s announcement. The proposed system is intended to produce drop-in synthetic fuels that can be used in aircraft without requiring them to be blended with conventional fuel, according to the Defense Innovation Unit. Its early focus included vodka made using alcohol produced from carbon dioxide and hydrogen. The company later expanded its work towards industrial applications, including synthetic aviation fuel. The public announcements do not explain the difference between the two figures, and neither should be mistaken for confirmation that the full amount has been paid. The project involved the US Air Force, the Operational Energy Capability Improvement Fund, the Department of Energy and the US Army’s Office of the Chief of Engineers. Military operations often depend on long supply chains involving ships, tanker aircraft and ground convoys. Those routes can become vulnerable during conflict, making fuel availability a logistical and operational concern. Air Company’s process uses carbon dioxide and hydrogen to manufacture fuel, with the goal of reducing dependence on transported fuel supplies. The company expands MAD as “Mobile, Adaptable and Dynamic. The system is designed to combine carbon dioxide, hydrogen and an energy source to produce fully formulated synthetic fuels, including aviation fuel. A containerised system could, in principle, be transported to remote sites instead of requiring fuel to be shipped over long distances. The announcement describes a technology under development, rather than a completed network of operational fuel-production units. The company has also identified airline partners, including JetBlue and Virgin Atlantic, in its public materials. Such partnerships indicate commercial interest, but they should not be interpreted as proof that those airlines are already purchasing synthetic fuel from AIRCO at commercial scale.