Idemitsu Cuts Lube Production Costs


Following a government call for improved efficiency, Japans Idemitsu Kosan Co Ltd aims to reduce costs for base oil and lubricant production by cutting its use of crude oil for steam generation by 1,800 kiloliters per year, the company told Lube Report Asia.

The company reduced the amount of steam in its deaerator for the production of lubricants by 65 percent by changing a manual valve for feedwater supply to a self-regulating valve, enabling the right amount of steam to be produced for the Number 4 boiler at its lubricant blending plant. Idemitsus only lubricant plant in Japan is in Ichihara, Chiba Prefecture, and mainly produces the Apollo series of automotive lubricants.

Since the installation of the self-regulating valve in 2013, Idemitsu reduced labor by 250 man-hours per year and crude consumption by 760 kiloliters per year, about 40 percent of its target.

We expect to achieve our target by the end of March, said a company spokesman who declined to disclose other cost reduction plans.

The companys total sales volume of lubricants in the third quarter of 2014 (released in February) increased by 0.3 percent to 779,000 kiloliters.

The Japanese government is urging oil companies to collaborate and increase efficiency as the nations shrinking demand for fuel, lubricants and other petroleum products hurts the industry. In a February report last year, the Ministry of Economy, Trade and Industry said, With a shrinking domestic demand, there is a need to improve margins by increasing volume. The ministry also stated, [I]t is necessary to adjust facilities to demand in order to improve margins.

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