Shell Lowers Anchor on Indonesian Marine Oil

Shell now produces nearly 100 products, including marine lubricants, from its almost one-year-old, 120,000 metric tons per year blending plant in Jakarta, Indonesia.

The lubricants manufacturing facility in Marunda Centre, near Jakarta - Shells only lube factory in Indonesia - has doubled production capacity since it opened in the fourth quarter of 2015. Marine lubricants have been a notable addition to the plants production slate, the company announced last week.

The Indonesia plant began producing Argina, Gadinia and Melina brands of marine engine oils, which can be used in small to mid-size vessels with propulsion engines, marine auxiliary engines and in stationary power generation. Shell Melina is a crankcase oil for low-speed marine diesel engines.

The local production of these marine lubricants is in response to the anticipated increase in demand for marine lubricants, due to the growing domestic maritime sector in Indonesia, the statement read. This came about as a result of the Indonesian governments maritime highway program, which involves developing the countrys maritime infrastructure by upgrading ports throughout the archipelago.

The plant neighbors the countrys busiest seaport, the Port of Tanjung Priok. Shell noted that it also stocks marine lubes in depot locations at other major ports in Indonesia to serve domestic demand. The plant enabled Shell to transition from almost exclusively importing its lubricants that it sells in Indonesia to producing around 70 percent of those products domestically, the statement added. Shell has no plans to export products made in Indonesia, a representative told Lube Report Asia.

Production has increased over the past year to cater to the continued demand growth in the Indonesian market, especially in the automotive sector, the representative said.We have also seen continued growth in the industrial sectors, like power generation, construction, mining and also in marine.

Shell anticipates increasing the plants production capacity more as demand growth continues, particularly in eastern Indonesia. This plant also enables our business to expand its reach… to Kalimantan, Sulawesi, West Nusa Tenggara, East Nusa Tenggara, Ambon and Papua, said Alex Marpaung, Shells lubricants supply chain operations manager for Indonesia.

Shell claims that the plant is the largest operated by an independent oil company in the country. It contains three small pack filling lines, two drum filling lines and one bulk filling line.

Photo: Flickr / Martin Alexius