Gulf Oil Lubricants India Ltd. opened its new blending plant in Chennai last week with capacity to make 50,000 metric tons of lubricants per year.
The lubricant maker started commercial production on Dec. 14 in Ennore, a coastal neighborhood of Chennai, in southern India. Gulf Oil invested around Rs 180 crore (Rs 1.80 billion, or U.S. $28 million) in the plant, according to a regulatory filing.
The company first discussed plans to build a second blending plant near the southern industrial hub in 2014, but the projects original schedule hit snags because of delays obtaining clearances from local authorities.
With its Chennai plant, Gulf Oil aims to tap opportunities for partnerships with original equipment manufacturers based around Chennai and also to serve the needs of consumers in the southern part of the country, which accounts for approximately 30 percent of its sales volume. As Indias biggest automobile hub, Chennai hosts production factories for automakers such as Hyundai, Renault Nissan, BMW and Ashok Leyland.
Gulf Oil expects that its new location will help it save big on freight costs. To date, the Mumbai-based firm had supplied all its customers across the country from its 90,000 t/y blending plant in Silvassa, in western India. Gulf Oil sells a wide range of automotive and industrial lubricants and greases through more than 300 distributors and over 55,000 retailers in India.