Korea Eradicates Idle Blenders


The South Korean government has moved to eliminate more than half of all registered domestic lubricants manufacturers in an effort to weed out non-operating and illegitimate businesses. Blenders pegged for closure were given 90 days from the November notice to verify their legitimacy and remain open.

Koreas Ministry of Trade, Industry and Energy announced an administrative measure to shut down 165 lubricants blenders in November unless they file objection within 90 days of the announcement – a deadline which is approaching soon.

Kim Gi-dong, the ministry official in charge of the policy, told Lube Report Asia last week that the measure was takento overhaul the industrys deadweight. The administrative disposition falls under the Petroleum and Petroleum Substitute Fuel Business Act, which mandates that a manufacturer of petroleum products such as lubricants that has suspended operations for more than a year, or that has not started business after reporting its commencement to authorities, shall be officially closed.

Klean Korea Corp., Bardahl Oil Korea, and Chemtech Korea Co. are among blenders on the list slated to be shut. Locations of listed businesses extend nationwide, but Gyeonggi province is home to more than any other, with 60 companies.

The ministrys action began in April 2016 when it issued a preliminary notice that listed 177 blenders subject to closure. Twelve companies – including Mega Lube and Mobil Korea Lube Oil Inc. – were allowed to continue business after verifying operation.

The number of companies registered in the country as lube blenders had doubled since 1998, whengovernment deregulated the industry, switching from a licensing system to a reporting system, according to Korea Lubricating Oil Association. However, many registered lubricant manufacturers have not been in operation in recent years. Some were rented, and some were used to produce counterfeit lubricants.

Kim said the measure came afteran investigation into more than 300 lube manufacturers in the country by Korea Institute of Petroleum Management (K-Petro). With this measure, there [would be] 120 lubricants blenders left in business, Park Ji-Seo, a K-Petro official, told Lube Report Asia last week. Companies on the list of those to be shut down are mostly small-scale blenders that have ceased or suspended business due to financial or managerial problems.

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