Many Chinese lubricant suppliers struggle to find footing in the countrys increasingly overcrowded market. One Xian-based blender said it has found success in the exclusive niche of lubes for onshore oil rigs.
Xian, Shaanxi province-based Jarn Industrial Co. said its unique background gives it aptitude to supply to the hard-to-enter market of lubricants for original equipment manufacturers of oil rigs. We are an OEM oil supplier mainly for onshore oil rigs, which is a niche market with mild competition because it is not open to everyone, Yang Yi, company president, told Lube Report Asia.
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Oil rigs in China are mainly manufactured by or affiliated with the three state-owned refiners: China National Petroleum Corp., Sinopec and China National Offshore Oil Corp. The three co-founded Jarn with Xian Shiyou University, which means petroleum university. Last year, one of CNPCs affiliated rig manufacturers, Chuanqing Drilling Engineering Co., gave the university a used rig for educational use.
Chinese-made rigs may not be the best, but they are adopted in quite a lot of countries. It helps with our sales, Yang said, noting that Jarns major client, CNPC, sells rigs all over the world.
Jarns lubes have been distributed to countries such as Canada, Oman and Kazakhstan – a country included in Chinas One Belt, One Road trade initiative. Yang said he expects the future will hold more energy programs – as well as opportunities for Chinas lube industry – in Central Asia. [OBOR] is highly meaningful as trade frictions between China and Western countries will continue to rise. We indeed should look elsewhere for opportunities, Yang said.
For Jarn, new opportunities also lie in the clean energy sector, Yang said. We are expanding to serve clients such as landfill gas power plants and wind power generation equipment manufacturers.
Apart from supplying to OEM clients, Jarn will also explore markets on its own to gain clients outside China. Last year, the company received approval to export lubes.
Another advantage for Jarn is that its co-owner, the university, attracts many students from Central Asian countries each year, and Yang said these students, who usually take an internship in Jarn, often promote the brand after they return to their home countries. Its good advertising for us, Yang joked.