Polyalphaolefin (PAO) base oils belong to API Group IV and consist of chemically engineered synthetic hydrocarbons. They are produced through polymerization of linear alpha‑olefins derived from feedstocks such as 1‑decene. The resulting fluids have a high viscosity index, typically around 130, a low pour point and high oxidative stability. These characteristics support reliable lubrication across a wide temperature range. PAOs are less volatile than mineral oils and offer improved high‑temperature wear protection. They also resist viscosity increase with age and reduce deposit formation in engines and industrial systems.
POAs are produced by a fairly small number of manufacturers, with global capacity at around 730,000 metric tons per year. The largest producers include ExxonMobil, which has capacity of 301 000 t/y, Ineos Oligomers with 355,000 t/y and Chevron Phillips Chemical with 43,000 t/y.
Growth is occurring in regions such as China where independent refiners and joint ventures have begun developing PAO facilities. China National Offshore Oil Corp in partnership with Shell, licensed Neste technology to build a PAO plant in Huizhou City. That site also added capability for linear alpha olefin production and later expanded capacity further toward 2028.
China accounts for development of mostly high‑viscosity PAOs used in gear oils and industrial lubricants. PetroChina’s Lanzhou facility is reported to be the first low‑viscosity PAO plant in the country, producing products with performance metrics comparable to imported grades in terms of viscosity index pour point flash point and low‑temperature dynamic viscosity. Despite that development PAO remains a small percentage of global base oil supply, under 1 percent according to industry sources.
PAO base oils maintain advantages under low temperature and high shear conditions where mineral oils and even refined Group III may not deliver equivalent film strength or cold‑start protection. The molecular consistency of PAO gives it uniform behavior that aids in performance predictability. The fluids do not require dewaxing during manufacture since their structure resists wax crystallization. Earlier low-viscosity PAOs exhibited moderate viscosity index values but modern grades made with metallocene catalysts offer improved oxidative performance and pour point resistance.
Cost remains a limiting factor. PAOs are more expensive than Group III and much more costly than mineral oil grades. Adoption depends on whether formulators receive price premiums for performance or emissions reduction benefits. PAO production is more complex and feedstock competition exists since linear alpha olefins are also used in detergent manufacturing. This limits global capacity growth and confines production to firms with olefin polymerization expertise.
Despite price pressure, synthetic demand remains in applications such as wind turbine gear oils hydraulic fluids industrial compressors and specialty automotive lubricants. PAO fluid use in these sectors continues to support long term viability for this product class while maintaining a niche position. Growth prospects are tied to industrial expansion regulatory demands for high performance and energy efficiency trends globally.
Producers
Apalene Technology
CNOOC & Shell Petrochemicals Co. (China joint venture)
Dowpol
Dowpol-Lu’an
ExxonMobil Chemical
Ineos Oligomers
Lanxess
Lu’an Group
PetroChina
Shanghai Fox Chem.
Taif Group