China offers great opportunity for progress in the recycling of used lubricants – both in terms of the volume recycled and the quality of products produced, an industry insider told a recent conference in Moscow.
The volume of used oil collected is growing at a healthy rate and is on track to reach 3.6 million metric tons this year, an official with Italian rerefiner Viscolube told the Global Business Clubs CIS Base Oils, Lubricants and Fuels conference in May. However, most oil that is recycled does not comply with regulations for environmental protection or product quality.
Viscolube Technical Director Fabio Dalla Giovanna said Chinas used oil market can be viewed in two segments – one that operates according to regulations and one that does not. Only 18 percent of the Chinese total used oil market is currently regulated, while the rest of it is not fully compliant with the countrys existing regulations, he said.
According to Viscolube, there are eight large rerefineries in China capable of producing 30,000 t/y to 40,000 t/y of base stocks that qualify as API Group I oils.
Chinas lubricants market, estimated by some to be the largest in the world at as much as 8.5 million t/y, generated about 2.3 million tons of collectable used oils in 2013, or roughly 3 million tons of used oils plus water and other chemical pollutants, said Giovanna, who is also president of UEIL, an association of the independent European lube manufacturers. Of these 3 million tons, legally recycled and rerefined used oil amounted to 724,000 t/y in 2013, while oils disposed or burned as fuel amounted to 226,000 t/y in the same year, he said, quoting data from consultancy In3act.
In3act predicts used oil collection in China will grow, both in the regulated and in the unregulated segments. Regulated collection [and processing] will reach 923,000 tons in 2015, from 512,000 tons in 2012, Giovanna said. The firm expects 740,000 tons of waste oil to be owned by the legal rerefiners and 183,000 tons to be owned by independents in 2015.
On the other hand, unregulated collection and processing is expected to reach up to 2.5 million tons in 2015, a slight increase from 2.3 million in 2012. In provinces such as Hunan, Shandong and Liaoning, collection is directly controlled by regenerators, and the volume is higher than in other provinces, Giovanna said, adding that the distinction between the regulated and unregulated collection is not clear-cut. Some volumes of collected used oil flow from unregulated to regulated operators.
Giovanna said the volumes that he refers to as unregulated is collected or processed in ways that fail to meet some regulations involving environmental protections or standards for used oil processing. He contended that the industry would benefit from several reforms: closer enforcement of existing regulations and standards; prohibitions against burning used oil for fuel; and incentives for collection and recycling of used oil, including government subsidies.
He added that the quality of rerefined base oils in China is still far from that of virgin oils, that the technology used for processing used oils is sometimes rudimentary and that there is a lack of professionals in this field. Chinese technology is still far from Western standards, while the countrys regeneration capacity planning is out of control and risks future over-capacity, although many announced plants havent been opened, Giovanna concluded.
Citing In3ct data, Visclube also found that Chinas rerefining capacity is largely insufficient to cover the countrys overall potential in used oil generation.