Nynas Adjusts to Lyondell Curveball


Nynas Naphthenics plans to increase supplies from its existing production sites to offer its customers alternatives to Tufflo naphthenic products, following LyondellBasells cancellation of its contract with Nynas in favor of Calumet.

On Oct. 1, Nynas was informed that LyondellBasell had decided to reject the long term contract for the Tufflo products, which are hydrotreated naphthenic process oils used in coatings and inks. In a statement, Nynas noted it had offered to modify terms for LyondellBasells benefit. The Swedish supplier will no longer source products directly from LyondellBasell effective Nov. 1, pending a U.S. Bankruptcy Court decision.

The change will remove more than 20 percent of Nynas total naphthenics capacity, though the company said it had made contingency plans in advance. This was something that we were partly prepared for, said Per Dahlstedt, Nynas vice president. After the uncertainty caused by LyondellBasell filing for protection under the U.S. Bankruptcy Code, we developed a plan for alternative supplies that now will take effect. At Nynas we are committed to being a long-term partner to our customers globally, and we have the capacity to increase the supplies from other production sites.

In addition to its own 7,800 barrels-per-day naphthenic base oil plant in Nynashamn, Sweden, Nynas also markets the pale oil output from Petroleos de Venezuela S.A.s Rafineria Isla in the Netherlands Antilles (3,700 b/d) and Valeros Three Rivers, Texas, U.S. refinery (2,400 b/d).

Nynas stated it will offer its customers alternative products in the majority of cases. Since Nynas is focused on high quality specialty products, U.S. customers buying commodity grades could experience fewer alternatives, the company noted.

For Nynas transformer oil customers, the company said there will be no products shortage due to the canceled supply contract with LyondellBassell. Nynas will still be able to supply the tire industry with the demand for Nytex 4700, the company continued. Nytex 4700 is a naphthenic process oil used in coatings and inks.

Nynas expects a growth within these product segments, and we have the capacity to increase our deliveries from our own plants and from partner refineries within our global network, Dahlstedt continued. We are also launching new products to cover the demand of heavy viscosity material, bright stocks. Together with the new [tire] oils, bright stock alternatives are unaffected by this event.

Calumet will market LyondellBasells 3,600 barrel-per-day naphthenic base oil production out of the latters refinery in Houston starting Nov. 1 under a long-term, exclusive specialty products affiliation announced Oct. 2. As part of its Chapter 11 bankruptcy reorganization, LyondellBasell solicited bids to replace its contract with Nynas. The agreement with Calumet is subject to approval of a motion with the U.S. Bankruptcy Court.

Nynas Group is owned equally by PdVSA and Finlands Neste Oil.

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