Catalyzes the stereospecific epoxidation of squalene at the terminal double bond to form (S)-2,3-epoxysqualene, the first oxygenation step in sterol biosynthesis. 2 Fe(II)-[cytochrome b5] + 2 H(+) + O2 + squalene = (S)-2,3-epoxysqualene + 2 Fe(III)-[cytochrome b5] + H2O The activity of this enzyme is not inhibited by terbinafine, an established inhibitor of the conventional flavoprotein squalene epoxidase. Terpene metabolism; lanosterol biosynthesis; lanosterol from farnesyl diphosphate. Interacts with cytochrome b5/PHATRDRAFT_30770. Detected in the outer envelope of chloroplasts, which is termed the chloroplast endoplasmic reticulum and is continuous with the nuclear envelope. The histidine box motifs may contain the active site and/or be involved in metal ion binding. Belongs to the sterol desaturase family.