TRhe lubricants industry has a large ethical part to play in the disposal of products left over from the base oils and additives used in the formulations of finished lubricants. Whether automotive or industrial oils, these products all have a life expectancy after which the remaining material has to be disposed of as effectively as possible. This has traditionally meant the collection and burning of waste oils often blended or mixed in with various fuels for heating or power generation.

Through organizations such as the European Waste Oil Rerefining Industry Association (GEIR) and similar enterprises around the world, an industry segment that initially disposed of waste oils has evolved to regenerate (or rerefine) material to produce base oils along with other offcuts such as gasoline, diesel and bitumen, which can be reused as important additions to virgin sources for these products.

Getting oil reclamation projects off the ground has been challenging. Finnish oil seller and marketer EcoStream and reclamation company L&T Recoil established a 50-50 joint venture in 2007 and built a greenfield rerefinery in the port of Hamina, Finland. High initial construction costs put the project into the red, and the operation closed in March 2014, during which time it had produced and marketed a limited range of rerefined API Group II base stocks.

The plants assets were then bought by refining company STR Tecoil in July 2014, and the management and processes were addressed, altered and amended to bring the facility into line with modern collection and production techniques, whilst using a hydrotreatment process in the regeneration of waste oils. The resultant output has since been widely accepted and recognized by a raft of European lubricant blenders.

However, a secondary blow to the plant occurred as a result of the collapse in crude oil prices during the second half of 2014 and into the first quarter of 2015. This brought heavy losses to what had promised to become a Baltic oasis for the rerefining of waste oil. The venture continued losing money into 2015.

With further reorganization and feedstock problems sorted out during the first part of 2016, the refinery started to turn around. The effects of this determined attempt to make the operation viable started to become evident in 2016 and became reality during 2017. Since this reversal in fortunes and with careful and proficient management, record monthly production quotas have been the norm with the highest monthly celebrated in October this year, when more than 3,750 metric tons of fully hydrotreated base oils were dispensed from stock. Further improvements and streamlining being considered as part of the ongoing development of the venture could promise a healthy positive bottom line.

A key challenge for the venture has been its location, tucked away in the eastern corner of the Baltic, making purchasing, collection and transportation of waste oils difficult. To improve the economics and logistics, STR Tecoil purchased its own tanker, the MT Tecoil Polaris, which will feed material into the refinery from Scandinavia, Russia, the United Kingdom and northwestern Europe from November this year.

Waste oil feedstock for the Hamina plant is mainly automotive lubricants obtained from garages and large fleet operators, making up around 70 percent. The remaining 30 percent comprises industrial oils, such as hydraulic, gear and turbine oils, from various locations. Domestic supplies of waste oils account for only around 30 percent of requirements, hence Tecoil is very much dependent on gaining access to feedstock from neighboring markets using larger volumes of finished lubricants.

The future appears to be a little more secure for the Tecoil operation. Two large rerefiners, the North Refinery in the Netherlands and Waste Oil Services in Belgium, have left the market due to financial problems. And with fire damage occurring at a competitor’s refinery in Kalundborg during August, these events have opened doors to Hamina production, which otherwise may have been more difficult to explore.

The other major benefit for Tecoil is that the hydrotreatment process lends excellent results to the quality of the two base stocks – N75 and N150 – with the main grade, N150, having superior properties, with a viscosity index consistently between 121 and 123. (Technically, this grade could qualify as Group lll, although Tecoil prefers to describe it as Group II+.)

This technical advantage will continue to be an ace-in-the-hole for the Hamina plant since only a few rerefiners around Europe can offer material with such a high quality, and this will continue to be reflected in the acceptance of the product, since those without this type of technology and process will have to compete in other less-viable and smaller niche markets where competition may be stiff.

STR Tecoil is to be congratulated for its efforts to promote what is a small operation in a large market. But in playing its part, the company has established the a point to which recovered waste oil can gravitate and where quantities of recovered lubricants can be regenerated into material with added value, whilst protecting the environment from further unnecessary carbon emissions.

But there are still hurdles, some from within the industry. A major lobbying group wants to keep using waste oils for power generation. Although not anti-green per se, the group is less committed to a fully integrated rerefining system that mandates waste be regenerated into base oils and other petroleum products. The ethical battle has some way to go before the war is won.