During a presentation at the Independent Union of the European Lubricants Industry (UEIL) Congress in Dubrovnik, Croatia, last October, she noted that the 1980s saw the market for naphthenic base oils shrink due to two major factors. First, the automotive industry moved to higher viscosity index oils, making naphthenics unsuitable for this segment. Second, many industries demanded base oils with lower aromatic content, leading to the disappearance of less refined grades of oil.

While these market forces placed stress on producers of naphthenic oils, they had the beneficial effect of making companies identify applications where these oils held a technical advantage, Serra-Holm said.

She went on to explain that in the 1990s, to counter the downward sales trend, naphthenic oil producers began developing products aimed at meeting the needs of a few core segments. As a result, a number of new oils became available through the development of specialty blends and the use of different degrees of refining. These efforts have effectively stopped and even reversed the downward trend in the market.

The move to specialization has accelerated in the last decade, she added, and suppliers have focused on developing oils for four main industries – lubricants, chemicals, tires and electrical. Of these, the tire and chemical industries have shown the highest growth.

Lubricants

Serra-Holm explained that lubricant applications include metalworking fluids, greases, low-temperature hydraulic fluids and refrigeration oils.

Metalworking fluids: In water-based metalworking fluids, naphthenic oils provide higher solubility than paraffinic oils, she said. Thus, they create highly stable emulsions that wont separate. As a result, naphthenic metalworking fluids stay homogenous and free from sediment even at low temperatures. This also means the fluids need not be heated when being transported during the winter.

Naphthenic oils also dissolve additives easily. This allows the use of large amounts of additives and many different kinds of additives. For this reason, naphthenic oils are also used in combination with paraffinic oils in highly additized neat metalworking fluids to improve additive solvency. Their low volatility index gives naphthenic metalworking fluids superior heat transfer properties, said Serra-Holm, an important property in neat cutting fluids.

Naphthenic oils provide a number of additional advantages, including good response to antioxidants, high metal affinity and low staining. Also, naphthenic-based fluids are more easily filtered due to their low viscosity index. Finally, todays naphthenic oils are oxidation stable due to advanced hydrotreating technology that refines oils at high temperatures and high pressures.

Typical viscosities for oils used in water-based metalworking formulations are 9 to 30 centiStokes at 40 degrees C. Neat oils use a wider viscosity range of 3 to 1,000 cSt.

Grease: The main reason to use naphthenic oil in grease formulations is their excellent solvency, Serra-Holm said. The primary advantage of more highly solvent oils in greases is improved soap yield, meaning that less soap is needed to reach a certain level of consistency. Moreover, highly solvent oils exhibit high soap affinity, allowing formulators to control oil bleeding in their greases regardless of consistency. Naphthenic oils also provide excellent low-temperature properties. Typical viscosities for grease formulations are above 100 cSt, with lower viscosity oils being used in low-temperature applications.

Hydraulics: In hydraulics, naphthenic oils are primarily used in aviation fluids as a complementary base stock, meaning they typically account for 20 percent of the formulation by volume. The main asset of naphthenics here is their low-temperature behavior, in particular their viscosity at very low temperatures, said Serra-Holm. Moreover, these oils can be used to adjust the seal compatibility of the formulation because they are highly compatible with elastomers. Typical viscosities for these formulations are below 20 cSt.

Refrigeration: Refrigeration oils represent a traditional application for naphthenic oils and one for which pale oils are naturally suited. In refrigeration systems, naphthenic oils provide excellent low-temperature properties as well as low floc point, said Serra-Holm. (A floc point is the temperature at which solids in a liquid begin to clump together.) Typical viscosities for these formulations are 9 to 100 cSt.

Chemical Specialties

Naphthenic oils find broad application in the chemical processing industry, noted Serra-Holm. Their key properties in these applications are high solvency and elastomer compatibility.

Rubber processing: Naphthenic oils are used as plasticizers in a wide range of rubber applications, in both synthetic and natural compounds. The oils provide high solvency and compatibility with a variety of polar and non-polar elastomers. Thus, they help improve the overall mechanical properties of the finished rubber. Moreover, highly solvent oils contribute to improved aging resistance, thereby ensuring a longer service life. Typical viscosities for rubber formulations are 20 to 450 cSt.

Adhesives: One of the main applications of naphthenic base oils in the chemical industry is adhesives, for instance thermoplastic elastomer-based adhesives and hot-melt, pressure-sensitive adhesives, said Serra-Holm. The main functions of the oil are to dissolve and carry the polymer and resin, and to adjust tack and glass transition temperature. The most common grades for adhesives are technical white oils. Naphthenic oils have a higher compatibility with the different phases of TPE and, therefore, contribute to the formation of products with excellent adhesive properties and good mechanical properties, such as high creep resistance, she added. Typical viscosities for these formulations are around 100 cSt.

Polymer processing: Thermoplastic elastomer producers use naphthenics as plasticizers because of their excellent compatibility with certain types of TPE. In both soft and rigid polyvinyl chlorides, naphthenic oils increase production speed, cutting energy use during processing. They also cut raw material costs of soft PVC by replacing expensive primary plasticizers.

The low viscosity index of naphthenic oils allows the use of higher viscosity oils that are less volatile, and provide improved processability. The higher density of naphthenics also leads to higher loading of the plasticizer in the final material boosting plasticizing efficiency. Typical viscosities for these formulations are 20 to 150 cSt.

Printing inks: Naphthenics provide excellent solvency for resins and pigments; therefore, resins dissolve more readily in the oil. Also, the high pigment wetting ability of naphthenic oils leads to more homogeneous ink formulations. Typical viscosities for these formulations are 4 to 30 cSt. Higher viscosities are used in some niche applications.

Tire Processing

In tire processing, naphthenic oils are used as extender oils. The main functions of the oil are to adjust processing properties, such as tack and compound viscosity, and to help tailor some rubber properties, such as glass transition. Naphthenics are also used as plasticizers and as compound viscosity reducers. The use of naphthenic oils enables formulations to meet glass transition temperature requirements in the finished tire. Moreover, said Serra-Holm, tests show that when naphthenic black oils are used in the formulation of tires, the tires have a lower rolling resistance than when other tire oils are used, with a consequent improvement in fuel economy. Typical viscosities for this application are 200 to 700 cSt.

Naphthenic oils also are environ-mentally friendly alternatives for tread compounds to replace aromatic extracts.

Electrical Specialties

Naphthenic oils are typically used in transformer oils, where they provide excellent low-temperature properties. They can also be easily adapted to meet local and global regulations in both inhibited and uninhibited oils. Typical viscosities for these formulations are 8 to 10 cSt.

A Catering Strategy

Serra-Holm explained that specialization provides a number of advantages for naphthenic oil suppliers. First, it provides better immunity to economic fluctuations, she said, because the various segments often are affected by the economy in different ways.

Second, it leads to improved market stability because specialty segments are often highly complex, requiring extensive testing and approvals. This provides a barrier to entry because products with long and complex approval processes are less likely to change.

Finally, she added, specialization engenders a higher degree of technical interaction with customers to gain knowledge about specific application requirements. This intimate understanding leads to the development of product slates that better meet current technical requirements and anticipate future needs.

Specialization has paved the way for substantial growth in the markets for naphthenic oils, Serra-Holm said. Nynas predicts that the potential market will grow from around 5 million metric tons in 2010 to 7.5 million tons by 2020. The main drivers for growth will be the development of oils specifically for the tire industry and the continued rationalization of API Group I oil production. This latter trend will lead to greater demand for higher viscosity oils with higher solvencies.

But specialization comes with a price. First, it entails developing and maintaining a highly complex range of products, Serra-Holm noted. In addition, it emphasizes the importance of good logistics to be able to supply the right product at the right time in the right place.

While specialization requires increased resources, it has helped stabilize the business. It has also focused attention on providing good customer service, including:

Maintaining close contacts in the marketplace. This enables suppliers to understand the requirements of specific applications, to follow trends and legislation in different industries and to support customers with up-to-date product offerings, geared for current and future requirements. This approach makes the oil supplier a solution provider. Participation in trade associations is an essential part of this.

Taking a global approach to product development. One aspect of ongoing globalization is that formulators require the same quality globally. A successful supplier needs to meet global specifications with global availability.

Willingness to develop custom solutions and tailor-made products. When the standard product offering does not meet specific requirements, a specialized supplier needs to develop custom blends.

Improving delivery and increasing storage capacity. One aspect of customer service is the ability to store products locally and deliver with short lead times. Another aspect is the ability to provide different types of delivery, depending on customer needs, from a few drums to tank trucks to shiploads.

Willingness to toll blend. We observed an increased interest by customers toward supplementary services from their base oil suppliers, said Serra-Holm. Toll blending is one of them.

More Tailoring Needed

Looking to the future, Serra-Holm identified the following needs for each market segment.

Lubricants: Develop a wide variety of viscosities from low to bright stock, and increase the number of tailor-made products. If naphthenics are to be an alternative to Group I oils in industrial applications, it is important for [naphthenic] producers to develop products that require minimal reformulation, she said. In this sense, blends of naphthenic and hydrocracked oils represent a valid alternative to Group I. Another opportunity stems from the shortage of heavy base stocks due to the shift from Group I to Group II and III in the paraffinic base oil pool. It is essential for naphthenic producers to develop the heavy side of the product slate.

Chemicals: Improve health and safety parameters, compatibility and purity. Here, we see a trend toward increased demand for white oils, Serra-Holm said. Therefore, the main developments should be in this area.

Electrical: Evolve products to meet the numerous specifications worldwide both in uninhibited and the growing inhibited markets. Here, the challenge is to maintain a high level of R&D activity to offer products that meet the numerous local specifications on top of global ones to secure a high geographical penetration.

Tires: Increase polymer compatibility and increase worldwide availability. To be successful, naphthenic producers need to develop a large product portfolio, she said. Also, because the market is developing very fast, a key success factor is high volumes with global availability.