Virgin boss Sir Richard Branson set the target at the announcement in London yesterday of a partnership with technology company LanzaTech to develop a low-carbon fuel.

The technology involves waste gases from industrial steel production being captured, fermented and chemically converted using Swedish processes for use as jet fuel.

The technology is currently being piloted in New Zealand. A larger demonstration facility will be commissioned in Shanghai this year, and the first commercial operation will be in place in China by 2014.

Sir Richard said: "We were the first commercial airline to test a biofuel flight and we continue to lead the airline industry as the pioneer of sustainable aviation.

"This partnership to produce a next-generation, low-carbon aviation fuel is a major step towards radically reducing our carbon footprint, and we are excited about the savings that this technology could help us achieve.

"With oil running out, it is important that new fuel solutions are sustainable and, with the steel industry alone able to deliver over 15 billion gallons of jet fuel annually, the potential is very exciting".