Bright stock supply volumes fell by around 15 percent since 2005, and according to one industry veteran, the global markets shortfall for that material will continue to grow.
Bright stocks supply attrition closely aligns with the closure of API Group I base oil refineries around the world. Although the search for cost-effective alternatives has intensified, polyisobutene is by far the most popular, constituting around 80 percent of substitution volumes.
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Availability, cost and technical constraints will probably limit the extent to which other products can loosen PIBs grip. Still, the widening shortfall of bright stock supply crunch – to an approximately 1.5 million tons deficit by 2020 – will create opportunities to increase sales of other products including polyalphaolefins and polyalkylene glycols.
Most bright stock comes from Group I plants, although naphthenic and Group II plants also make some volumes of base stocks that are also marketed as bright stock. Bright stocks are far heavier than other mineral base oils, ranging from viscosities of 1,875 Saybolt universal seconds for BS 135 to 4,800 SUS for BS225, compared to 500 SUS for Group I solvent neutral 500. BS150 is the benchmark bright stock.
Global bright stock capacity was 3.6 million tons in 2018, and that capacity was being used at a rate of 80 percent, Majid Safdari, Vista Energies commercial director, told delegates at last weeks AMEA Bitumen and Base Oil conference in Dubai. That resulted in about 2.9 million tons of supply from Group I refineries. Still, dwindling bright stock capacity may be offset by higher levels of plant usage in Eastern Europe, Russia and the Middle East, as well as by the use of new products. The deficit in 2020 will need to be made up by some other products too, says Safdari.
Stiffer emission regulations and a global push for better fuel economy have swept through base oil and finished lubricant markets, impacting conventional Group I solvent refining businesses. At the end of last year bright stock accounted for 13 percent of global Group I capacity and just 8 percent of all base oil groups, said Safdari. But bright stock continues to have many uses and is particularly common in gear oil and engine oil applications, which together accounted for 52 percent of demand volumes last year. Process oils, greases and industrial oils comprise another 31 percent of the bright stock market in 2018, Safdari estimated.
For now there appears little prospect of new plants to manufacture bright stock although some refiners including Luberef – a joint venture of Saudi Aramco and Jadwa Investments – have expanded in light of the growing shortfall. There have been several investments in recent years in PIB capacity, including a recently announced agreement by South Koreas Daelim Industrial to build a PIB plant in Saudi Arabia in cooperation with a joint venture between Saudi Aramco and Total. Safdari said PIBs have a number of intrinsic advantages, including wide viscosity grades, and are cheaper than other substitute fluids, including PAO and PAG.
PIBs are mass produced, and their ready availability means they are increasingly priced as a commodity which suggests new plant investments may put further pressure on profit margins. Safdari said other technical factors position PIBs as the go-to alternative to bright stock, including clean burn in two-stroke engines, resistance against microbial growth – beneficial in metalworking applications – hydrolytic stability and a lower mix ratio with heavy base oils. But other factors could put-off some customers, including lower solvency and the need to heat before transport and re-heat before use.
PAO is also touted as an alternative to bright stock, and its performance characteristics put it in a different category than PIB. It is also widely available and possesses excellent low temperature properties, according to Safdari. PAOs high viscosity index and shear stability make it suitable for gear oil applications. Yet, it is more expensive than PIB, and high viscosity grades are not widely available. Total global production capacity is approximately half that of PIB. There are a limited number of heavy PAO manufacturers, and decene, the PAO feedstock, is not widely available.
Meanwhile, PAG possesses good low temperature properties and a high viscosity index. It is particularly suitable for rotary and very low temperature applications, particularly turbine and compressor oils. Nevertheless, PAG is considerably more expensive than PAO and has a higher base oil mixing ratio, resulting in a higher cost per unit. Safdari says PAG is also incompatible with mineral base oils and most PAOs and PIBs. Common applications include refrigeration fluid, gear and chain lubricants, fire-resistant hydraulic fluids and compressor, metalworking and textile lubricants.
A lower cost alternative is naphthenic bright stock, which like Group I bright stocks falls under the mineral oil umbrella. It is very high viscosity, and a naphthenic bright stock is also available. It has better solvency properties and is used in grease applications. But naphthenic bright stock has a low viscosity index, around 80 to 85, and suffers from low availability. In marine oil applications it is less cost-effective and lacks original equipment manufacturer approvals in certain applications.
Investment in PIB seems likely to pay off because it is the product best placed to fill the gap created by the bright stock shortage. But it would be unwise to dismiss bright stock just yet. Safdari says that although the growing use of multigrade engine oils will reduce demand, that trend will be more than offset by growth in industrial applications.