The clock may be ticking for Europe’s oldest API Group III base oil plant.
Neste Corp. announced Monday that it wants to convert its Porvoo, Finland, refinery to process renewable feedstocks instead of crude oil, a change that seemingly would cause the base oil plant at that site to close.
Neste, among the energy companies transitioning fastest away from petroleum, said it aims to stop processing crude oil at the refinery by the mid-2030s. A news release issued Monday did not mention the refinery’s base oil plant, and the company did not respond to questions about it.
The refinery, which opened in 1961, has a base oil plant with capacity to make 250,000 metric tons per year of Group III oils. Neste supplies all of the output to Chevron through a long-term off-take agreement that was part of Neste’s sale of its base oil business to Chevron, which closed in April.
While fuel refineries processing crude oil can make lubricating base stocks, renewable fuel refineries do not.
Chevron did not respond to a request for comment.
Neste, which is headquartered in Espoo, Finland, said it is launching a strategic study into the possibility of converting the Porvoo refinery because it wants to significantly increase its production of renewable products – mostly fuels. The company pegged Porvoo’s long-term potential capacity for such products at between 2 million and 4 million t/y. The refinery currently has capacity to process 10.5 million t/y of crude oil and 2 million t/y of other feedstocks.
“Neste’s growth strategy is centered on renewable and circular solutions,” Neste President and CEO Matti Lehmus said. “The Porvoo site provides a flexible and large-scale base that can grow into a major site for our renewables and circular business.”
Neste formerly operated another crude fuels refinery in Finland – at Naantali – but it closed that facility in 2021 and is converting it to a terminal as part of its shift toward renewables.
Under a plan now being studied for Porvoo, that refinery would begin by processing both crude and renewable feedstocks and later retrofit existing units to process renewable feedstocks. The news release stated that the transformation would require significant investments, that final decisions for them would be made separately in coming years and that the time-frame for the overall project could change depending on market developments, including trends in demand for petroleum products and those derived from renewable resources.
Neste added that in any case it will continue to provide access to fossil fuel products for its customers.
The Porvoo base oil plant is Europe’s second-largest source of Group III base oils, behind a Cartagena, Spain, joint venture between SK Lubricants and Repsol that has Group III capacity of 537,000 t/y. Two Russian plants have Group III capacity of 100,000 t/y, and there are several smaller Group III plants in Western and Eastern Europe.