Base oil projects are queuing up to flood the global market with large volumes of highly refined stocks over the next several years. With demand flat, discussion about these projects frequently turns to speculation about which existing plants are most likely to close. Predictions generally point to facilities that make Group I oils.
A U.S. consulting firm contends, however, that it is wrong to assume that only Group I producers will be closing. During an industry conference in Houston this month, Solomon Associates Jamie Brunk maintained that Group I plants can compete with more modern hydroprocessing facilities. And while allowing that more Group I plants are likely to close, he ventured that Group II or Group III plants could be shuttered, too.