Global base oil demand will increase by 23 percent in two decades, according to predictions by consultancy Purvin & Gertz. But an official from the firm told an industry conference earlier this year to expect significant variations in trends for different regions and types of oil.

Speaking at WRAs Base Oils and Lubricants in Russia and the CIS conference in Moscow, P&Gs John Leavens said worldwide base oil consumption should reach 43 million metric tons by 2030, up from 35 million tons in 2010.

In Europe, the firm predicts, the split between base oil groups will change substantially in the next two decades. At the moment European lube marketers still produce base-tier engine lubes blended from [API] Group I base oils, said Leavens, who is based in London. But as Europes car fleet renews, the demand for mid- and top-tier engine oils will increase. And more lubricants will be made from Group II and III base oils.

We will see a gradual reduction of Group I base oils in Europe because they no longer will be used in most automotive lubricants, Leavens stated. It will result in a lot of Group I production capacity excesses and expected plant shut-downs.

Russia and the rest of the Commonwealth of Independent States will still be dominated by Group I demand by 2020. The consultancy expects steady industrial growth and an expanding automotive fleet, although lubes quality requirements will be less stringent than in Western and Central Europe.

Nevertheless, Leavens said, as Asias automotive fleet continues to modernize, the quality of automotive lubricants demanded there will eventually follow Western trends. Luxury and new cars will require mid- and top-tier lubricants, while Group I base oils will remain the base tier for automotive, industrial and marine lubricants.

Overall the base oil demand in Russia and the CIS will grow with Group I demand entering slow decline from 2020 on, he concluded.

Group II has a much higher percentage of the North American market because Group II producers have displaced Group I products simply because they established a plentiful supply and cost-effective [Group II] base oil production. Base-tier engine lubricants use either Group I or II base oils because the supply is prevalent and cheap, Leavens stressed. Mid-tier engine oils are also produced from Group II base oils, while top-tier engine oils are made from Group III.

Newer cars and trucks in North America require mid- and top-tier engine oils because automaker specifications require premium quality lubricants. While new vehicles increase demand for Group II and III base oils, Group I demand in Canada and the United States centers around industrial and marine lubricant sectors.

Similar to Europe, [North American] Group II and III base oil demand is rising while Group I demand is falling, Leavens noted. The main difference between Europe and North America is Group II and III base oils. Whereas the United States and Canada consume more Group II base oil, Europe consumes more Group III base oil.

Gazprom Upgrading Serbian Base Oil Plant

Naftna Industrija Srbije, a subsidiary of the Russian oil major Gazprom Neft, announced plans to boost lubricant production and upgrade its base oil plant in Novi Sad, Serbia. The U.S. $100 million [77.4 million] modernization will enable the Novi Sad refinery to process 180,000 tons of high-quality base oils annually, NIS said in a press release, adding that a significant amount of the output will be earmarked for export.

Construction is expected to start in the first half of 2013, and the plant is scheduled to go online by 2015. It will use Chevron Lummus Global base oil production technology and will produce naphthenic base oils as well as Group II paraffinic base oils.

Feedstock for the plant will come from Serbias SE Pannonian Basin Velebit oil-gas field. The plant will also use heavy residues after hydrocracking from its Pancevo refinery.

At the Novi Sad site, NIS also pro­duces finished lubricants marketed under the Nisotek brand. It anticipates a significant increase in lubricant volume to 50,000 tons per year by 2020.

Mauser Buys South African Stake

The reconditioning subsidiary of Mauser NCG has acquired 51 percent of the shares in Container Solutions South Africa. The company says this acquisition is part of its strategy to support customers worldwide with sustainable services.

Container Solutions South Africa is the largest reconditioner of intermediate bulk containers in South Africa, with operations in Johannesburg and Durban. The company is a founding member of the South African Industrial Container Reconditioners Association.

Together with Mauser, CSSA is investing in automated washing lines for the Durban and Johannesburg operations. This investment includes relocating both CSSA service sites to new, larger premises in the second half of 2012.

Avista Takes Control of Rerefinery

Avista Oil AG, one of the biggest producers of rerefined base oils in Europe, became majority owner of the Dutch North Refining and Trading rerefinery. The former co-owner, Dutch Van Gansewinkel Groep, sold its 33 percent stake in the Delfzij, Netherlands, rerefinery in August.

The Dutch rerefinery has facilities to accept used oils to produce lubricant distillates, a feedstock for base oil and for production of flux oils. Waste oil-water mixtures from shipping are recycled into new raw materials and fuel components. The North Refining and Trading rerefinery has the capacity to process up to 200,000 tons per year of waste oil, the rerefiner said.

Avista, which is based in Uetze, Germany, has two other rerefineries in Europe. Minerall-Raffinerie Dollber­gen GmbH in Dollbergen, Germany, can produce 120,000 t/y of Group I base oil. Dansk Olie Genbrug A/S in Kahlundborg, Denmark, has capacity to make 80,000 t/y of Group I. In 2011 Avista acquired a 50 percent stake in Universal Environmental Services LLC, which is building a rerefinery in Peachtree City, Georgia, United States.

Prista Forms Rerefining JV

Prista Oil Group of Bulgaria and Uznefteprodukt of Uzbekistan agreed to a joint venture to process industrial waste lubes into base oil. The 43,000 t/y base oil rerefinery is expected to be operational in the summer of 2013. Under the deal, Uznefteprodukt holds a 49 percent share of the enterprise, while Prista Oil has a controlling stake of 51 percent.

The 12 million joint venture consists of two companies that will operate in the Angren industrial park located near Uzbekistans capital of Tashkent. The first, Uz-Ecoprotect, was founded with 775,000 of authorized capital, and will collect, store and transport used industrial oils. Uz-Prista Recycling, the JVs second company, was created with 11 million of authorized capital to rerefine collected waste lubes and produce base oils.