India Plans Used Lube Oil Collection Centers

Indias state-run oil marketing companies plan to set up used lubricating oil centers across the country with an aim of making collection efficient in the burgeoning market.

Industry sources say the country recycles far less waste oil than it could and have flagged the disorganized nature of collection in the country as the biggest impediment. The handling of used oil, especially in the retail market, is informal and unstructured. The majority of used oil is burned as industrial fuel or is used to make adulterated fuels and lubes.

Government-owned Hindustan Petroleum Corp. Ltd., Indian Oil Corp. Ltd. and Bharat Petroleum Corp. Ltd. are looking to create a system that makes used oil management a more organized undertaking conducted in a scientific manner.

To begin the process, HPCL, on behalf of oil marketing companies, recently invited an expression of interest for hiring a consultant to assist the companies in setting up used lubricating oil collection centers in the country and establishing standard operating procedures to run such centers. The deadline for expressions of interest is March 30.

It is a welcome step, Philip Mathew, president of Petroleum Rerefiners Association of India, told Lube Report Asia. We had approached the government to help us in getting the used oil at reasonable prices so that the organized players can survive.

Mathew stated that registered used oil rerefiners, estimated to number more than 400 in the country, have difficulty buying used oil at reasonable prices because it gets diverted for different uses.

According to the invitation for expression of interest, the selected consultant will be commissioned to conduct limited surveys of the industry before suggesting a map of collection centers to registered rerefiners.

The selected consultant will get three months to design strategies for setting-up of collection centers and another nine months to do so.

Indias central government has set targets for the amount of rerefined base stocks used by lubricant blenders.

The aim is to utilize 25 percent rerefined base oil in the lubricant market in the country by 2023, which will save foreign exchange on import of base oil [and] conserve resources that otherwise are used for burning, and thus protect the environment, the statement said.

It added that used oil is a hazardous waste but if properly managed can be an important source of base oils.

India is the worlds third-largest lubricant market, and increasing the volume of rerefined base stocks could help reduce the countrys reliance on imports. The country currently imports more than half of the base stocks it consumes.