“For Luberef the effort is also aimed at securing a long term, reliable outlet for its products and byproducts,” Luberef President and CEO Tareq Al Nuaim told attendees about the initiative, which the company calls Lubehub Lubricants Value Park. “Lubehub will have a direct piped feed of lubricant base oil. Lubref is able to supply Group II and Group I base oil, as well as bright stock, bright stock extract and drilling fluid feedstock.”

He noted that as part of the Saudi Aramco base alliance – including Saudi Aramco, Motiva and South Korean base oil refiner S-Oil – “we can avail Group III and higher grades of base oil in the Kingdom for the Lubehub. The alliance has given Luberef the flexibility to import Group III base oil into the Kingdom and into the Middle East.”

The potential segments of plant investments at Lubehub can be divided into two main categories – finished lubricants and specialty oils. “The finished lubricants might include investments in production of finished lubricants, lubricant additives, jet oils, transformer oils and metalworking fluids,” Nuaim said. The specialty oils category could include investments in production of white oil and petroleum jelly, rubber process oils and drilling fluids.

During a question and answer session with attendees, Luberef Marketing Manager Waleed Murad noted that Saudi Arabia’s Vision 2030 calls for localization of more products. “That’s a market for the Lubehub in the future – it will help in localizing lots of products that currently are imported from outside,” Murad said during the question and answer session.

Aasem Jamoom, corporate planning manager for Luberef, pointed out that the country is importing much of its tires and transformer oils, for example. “Lubehub is a good opportunity to produce the essential feedstock material for transformer oil and for rubber oils,” he said. “It’s an intermediary place where investors can produce these essential feedstock materials from our byproducts.”

While answering questions from attendees, Nuaim expressed enthusiasm about growth opportunities in several regions. “We are only a couple of hours away from Africa,” he said, referring to Yanbu’s location along the Red Sea. “Africa is a very promising market – not only for the future investments and downstream business, but also for us as a base oil supplier. It’s an anchor of our expansion, into new markets.”

He noted that Yanbu is also close to the India subcontinent and has close access to Europe through the Suez Canal. “So the location of Yanbu is strategic for any investments,” he added. “I truly hope the Lubehub will be the place where major production for different products is happening. One, to satisfy the local market, and second, to satisfy the demand in the growing markets around us and to sell globally.”

Nuaim said the company also touts that its refinery’s production is based on a single, secure source of crude oil. “That ensures the reliability of supply and a consistent quality of its products, allowing the customers to maintain their operating parameters of their plants and improve operational efficiency,” he said.

The project is considered in line with a vision program known as the National Industrial Development and Logistics Program. “This program aims to transform the kingdom into a leading industrial power and an international logistics platform in a number of promising areas in a way that will generate employment opportunities for Saudis, boost the trade balance and maximize local content,” Nuiam explained. “In addition, an increase in local procurement and consumption is being promoted in line with Vision 2030, allowing potential markets for the products from the Lubehub. Luberef will help when needed in securing outlets to customers in the Kingdom, Middle East and African markets.”

Investors in the Lubehub will be able to take advantage of financial incentives and trade incentives. Several agencies are involved in the initiative, including the Saudi General Investment Authority, the Royal Commission for Jubail and Yanbu, the Saudi Industrial Development Fund, and the National Center for Industrial Development are all involved to launch this initiative. “Luberef will act as a link between the potential investors and the stakeholders who provide continuous support at all stages of establishing the investments in the Lubehub,” he said.