Weve been here as a producer all along, but we havent been as visible because we were supplying through third-party agreements, Petro-Canada Category Manager Tony Stranges said. Now we are going to be supplying them to customers directly.

White oils are highly refined, water-white, odorless and tasteless hydrocarbons used as ingredients in cosmetic and personal care products, as a process agent in production of some plastics, and as base stocks in lubricants for food processing equipment. For applications that involve human contact or potential human contact, white oils are subject to stringent credentials such as United States Pharmacopoeia (USP) and National Formulary (NF).

Petro-Canada is marketing a full line of white oils under the Puretol brand name.

Although unmentioned in Petro-Canadas Sept. 27 announcement, it is commonly known in the industry that the company has for several years sold its entire white oil output to Crompton Corp., which spun off its Refined Products unit in early 2005. The new company, Sonneborn, continued marketing Petro-Canadas paraffinic white oils, as well as naphthenic white oils that it produced itself.

In January of this year, Sonneborn announced it had resumed production of paraffinic white oils at its plant in Petrolia, Pa., after an explosion at Petro-Canadas Mississauga plant temporarily idled the production train that makes white oils. Sonneborn said then that it had decided to permanently discontinue the purchases from Petro-Canada.

In addition to Petro-Canada and Sonneborn, North America has two otherprincipal white oil suppliers: Penreco, which produces them at plants in Karns City, Pa., and Dickinson, Texas; and Citgo, which markets white oils produced at Lyondell Chemical Co.s Houston Refining plant.

Consulting firm Kline and Co. projects that white oil demand in North America is outpacing growth in the overall lubricant market, increasing at an average annual rate of 2 percent to 3 percent.