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Pitching a Plan

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For many years, quasi-governmental test centers played an important role in the lubricant industry of the Soviet Union and Russia. These facilities, many operated by state-sponsored research institutes, tested engine oils and other lubes to ensure conformance with the countrys performance standards.

Today, that system is under strain. Russian test facilities – and the standards themselves – have fallen out of date compared to other regions. An influx of foreign vehicles and foreign lubes has reduced demand for the services of Russian centers, driving some to close and raising doubts about the viability of others.

Now several organizations have asked the government to fund a national test center for engine oils and other lubes. Proponents say such a facility would be an important service and could also help revive the domestic lubricant industry. The project faces a number of obstacles, however, and it is not yet clear whether it will come to fruition.

A [fuels and lubes] testing center should be created at the states expense, said Oleg Tsvetkov, head of the oil department at VNII NP. It could possibly be realized by 2020 if the state approves the decision and investment.

Upholding Standards

Performance specifications are key elements of lubricant markets, especially markets for automotive engine oils. These specifications include numerous tests that are conducted on a variety of equipment – ranging from test engines to much simpler and less expensive laboratory apparatuses – owned and operated by test centers. In Europe and the United States, most test centers are private, independent businesses. In the Soviet Union, centers are operated by a mix of government-funded organizations – such as Nami-Khim automotive research institute and VNII NP, the All Russia Research Institute of Oil Refining, both based in Moscow – and labs affiliated with oil companies, such as SVNIIP, in Novokuibyshev, which is linked to Rosneft.

Like Europe, the U.S. and Japan, the Soviet Union had its own lube specifications, developed specifically for Russian vehicles and maintained under the countrys Gost umbrella of standards.

Russia carried on with Gost after the Soviet Union broke apart, but its testing system began to flounder. This was partly due to the countrys lubricant technology falling behind. While engine oil standards in the West are updated every few years, the main Gost engine oil spec was last updated in the 1970s. The noncompetitiveness took its toll as foreign automakers moved into Russia. Domestic oils were not qualified for use in foreign vehicles, so, as the car and truck park shifted to foreign models, demand for Gost oils shrank.

Also hurt by Russian economic struggles, a number of research institutes closed or stopped providing lubricant testing. Those that remained suffered funding cuts and were unable to purchase new test equipment. As existing equipment wore out or became obsolete, activity at the remaining centers diminished, raising doubts about their long-term viability. Nami-Khims facilities include 1970s and 1980s engine stands used for wear tests. The institute has equipment for oxidation, corrosion and sludge tests that still work but that do not correlate to todays engines.

This led to calls for a national test center, which became a common refrain at industry conferences in recent years. Officials from existing centers say the country needs a national facility with sufficient funding to acquire modern test equipment. In turn, the argument goes, this would facilitate the development of modern Russian oil standards and the technological revival of the domestic lube industry.

A National Center

Nami-Khim, VNII NP and the 25th Oils and Fuels Research Institute (which is affiliated with the Ministry of Defense) recently submitted a request to the Russian Energy Ministry asking for urgent help to establish a center for lubes and lube additives testing. The proposal has few specifics at this time and does not identify a price, but officials cited a current Chinese project to establish an automotive lubes testing program in that country.

They are investing about 1 billion in a huge complex that is expected to consist of 48 different labs with various bench tests, said Nami-Khim General Director Alexey Chudinovskiy. The Russian institutes envision a smaller and less costly facility – Chudinovskiy suggested millions of euros, rather than a billion – but believe the Chinese project underscores the importance of such facilities.

The institutes and others in the industry agree that obtaining approval for a national center is a tall task. For one thing, the countrys oil industry has other priorities. Since the early 2000s, the governments focus for the energy industry is on exploration and production of crude oil and natural gas. The state, observers say, cares less about an industry segment that needs specially trained personnel and top notch labs, yet is such a small fraction of the broader industry. Simply put, the Kremlin, which has major shareholdings in oil and gas, has no time for lubes.

It is unclear whether Russias big oil companies would lend much support to a test center. Companies like Lukoil, Gazprom, TNK-BP and Rosneft have increased their focus on lubricants in recent years, forming business units devoted to those products. But those wanting oils that meet Western standards have gone outside of Europe for testing – or simply purchased approved formulas off the shelf from foreign additive suppliers. Gazprom bought an Italian blending plant that came with approved oil formulas.

Harmonizing Standards

The institutes say they recognize the need for Russia to harmonize with international lubricant standards. This would erase the technology gap with the West, but it is not an easy thing to accomplish. For one thing, it would be very costly to acquire engine test stands and other equipment called for in Western specifications. And equipment is not the only cost. Test centers must also purchase methods from the organizations that develop tests to learn how to conduct them.

It cost 60,000 to buy the latest CEC method for testing wear at low temperatures, said Chudinovskiy, referring to the Brussels-based Coordinating European Council for the Developoment of Performance Tests for Fuels, Lubricants and Other Fluids. The CEC is the principal developer of automotive lubricant performance tests in Europe. Chudinovskiy said Russian testing organizations do not even have funds to buy the method.

Russians also face difficulties translating international standards. This pertains to language but also to mechanics. To the extent that Russian engines differ from foreign makes, lubricant standards may require some adjustments.

We have been invited to take part in CEC working meetings, Chudinovskiy said. But our specialist who would attend them does not possess the English language skills necessary for him to participate. We are not able to hire a professional translator for him because it costs a lot of money.

There have been attempts in recent years to address the situation, and some work continues. In the 1990s, Nami-Khim worked with Russias Association of Automotive Engineers (AAI) to develop a new engine oil specification. The voluntary AAI GSM certification system was meant to replace the Gost 17479 standard for lubes and fuels testing, and both standards are recognized in the market today.

However, the AAI standard also fell out of date, again for lack of funding. Its most recent upgrade is equivalent to APIs CJ-4 heavy-duty diesel engine oil specification, which was adopted in the U.S. in 2006. The main Gost standard, Gost 17479, is equivalent to API CF-4, which was introduced in the U.S. in 1988.

Avtodiesel, an engine manufacturer based in Yaroslavl, is developing a test engine meant to be part of an update to the AAI standard.

Awaiting an Answer

The government has not yet responded to the institutes request, but officials have already begun grappling with some questions that will need to be answered, such as how to cover ongoing costs. Like testing organization, they said, Russian oil marketers have fewer financial resources than their Western counterparts, so a test center must take care not to overburden them.

Currently we have pretty modest rates for our testing and certification services, Chudinovskiy said. If we realize our goal, we are going to use new equipment that is much more expensive. What rates will our clients have to pay [then]? To minimize the costs that are passed on, he suggested that the test center may try to buy test equipment from Russian manufacturers.

Some say Nami-Khim, VNII NP and the 25th Oils and Fuels Research Institute should enlist more partners to improve their chances of success. For example, Boris Sobolev, a member of the influential Russian Refiners and Petrochemical Producers Association, said that organization should be included. Oleg Tsvetkov, head of VNII NPs oil department agreed about the benefits of broadening the coalition.

We have a general concept, and we have to solve the issue of establishing a national lubes and fuels testing center in a gentlemanly and collegial manner.

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