Total will expand and upgrade its lubricant blending plant in Durban, South Africa, as part of a plan to increase its market share in that country and to boost sales in neighboring nations.
The changes to the blending plant are part of a broader project that includes construction of fuel storage space.
We see this as a major vote of confidence in South Africa, as well as in other countries in southern Africa, as some of the additional lubricants we will be blending will be exported to South African Development Community countries, which we see as a growth market for our lubricants, Total South Africa Managing Director and Chief Executive Officer Christian des Closires said in an April 24 news release.
Totals blending plant and existing fuel storage facilities are located at Durbans Island View Terminal. The company says it will spend a combined 140 million rand (U.S. $16 million) on the lubricant and fuels aspects of the project, which is scheduled to be completed by 2014. The announcement came after Total and South Africas Transnet National Port Authority signed a 15-year renewal for the lease of the land on which the facilities stand.
The blending plant currently has capacity to make 35,000 metric tons of lubricants per year when operating on one shift, as it does now. Total said the capital investment project will raise that number to 55,000 t/y. The company plans to modernize filling lines, upgrade an on-site laboratory and improve quality control measures. A spokesman told Lube Report that the benefits will include better conditions that will allow the company to introduce a second shift, thereby raising capacity to 85,000 t/y.
Management emphasized that it will take steps such as increasing lubricant inventories to ensure that deliveries from the Durban facility is not disrupted by the project. Paris-based energy giant Total owns 50.1 percent of Total South Africa. In compliance with national policies aimed towards providing opportunities to black South Africans in the wake of apartheid, local shareholders own the other 49.9 percent.
Paris-based spokesman Florent Segura said Total now holds 9 percent of South Africas lubricant market but that it has set a target of raising that share to 12 percent by 2017. In addition to the domestic market, the Durban blending plant supplies lubricants that are exported to Namibia, Botswana, Lesotho and Swaziland. The company plans to add several other markets to that list, including Malawi, Zambia, Mozambique and the Democratic Republic of Congo.