When it first announced the project, Luberef said it would increase bright stock output at Yanbu from 84,000 t/y to 175,000 t/y. Bokhary noted that the product slate and production quantities have not changed since then.

Luberef currently operates two Group I plants in Jeddah and Yanbu, with combined capacity of almost 560,000 t/y. A June 22 Reuters report, quoting unnamed sources, said Saudi Aramco was considering whether to close its 90,000 barrel per day crude oil refinery in Jeddah – which provides feedstock for Luberef – because of age and environmental concerns.

Given the potential closure of the Saudi Aramco Jeddah fuels refinery, Luberef is undertaking early stage planning, so that it is prepared and ready to continue the supply of Group I base oil from Luberef s Yanbu plant, if and when the Saudi Aramco Jeddah refinery closes, Bokhary said.

Modrica Unveils New Blend Plant

Rafinerija ulja Modrica recently launched a new blending center with capacity to produce 45,000 tons of finished lubricants annually. The 13 million blending plant is located at the site of the companys base oil plant in Modrica, northern Bosnia and Herzegovina. The center was developed during the last two years, the company said in its July 15 news release.

The advantages of the new blending center [compared to the old facility] are numerous, including reduced processing time, flexible … production and enhanced environmental properties of the products, the company said. By the end of 2015, the blending plant is set to produce up to 11,000 tons of finished products, according to Modrica.

In 2015, the refinery plans to produce about 63,000 t/y of API Group II and III base oils. Its primary products are base oils, finished lubricants and paraffin waxes. The company claims that Rafinerija ulja Modrica is the only refinery in southeast Europe capable of producing Group III base oils.

Gulf Petrochem Sets Sights on East Africa

United Arab Emirates-based Gulf Petrochem expanded into East Africa with its recent acquisition of Essar Petroleum East Africa Ltd., which was renamed Aspam Energy. According to Gulf Petrochem, the goal is to use Kenya as a hub for its expansion into East Africa and other parts of the continent.

G.V.K. Raju, Aspams regional head for East Africa, said, Our established office in Nairobi will act as a springboard to Gulf Petrochem for the sale of downstream products especially fuel oils, base oils and bitumen. The acquisition provides us a channel, through our newly acquired retail fueling stations, for the sale of all petroleum products like liquefied petroleum gas, fuel oil, bitumen, base oils and lubricants, in particular.

Raju said in an email interview that Gulf Petrochem has plans to set up grease and lubricant blending plants in both Kenya and Tanzania. However, he noted that it is vital for the group to first introduce its Ipol brand of lubricants and greases to the African market. Raju added, Our long-term plans are to set up and develop fuel stations in Tanzania, Uganda and Rwanda, subject to the regulatory framework of each country.

Gulf Petrochems entry into Kenya is expected to increase competition in the countrys lubricants and greases market. Joseph Ndugu of Lubes Africa, a trade magazine covering the continents lubricant industry, stated that the move will impact the local market as they try to acquire customers. However, another industry source said that the impact will not be felt in the near term.

Petro-Canada Expands in Europe

Petro-Canada Lubricants Inc. announced it is expanding distribution in Europe to enhance the availability of its products in bulk. The growth in our distribution network strengthens our ability to meet the demands of our customers in the fleet, power generation, construction and mining segments, explained Martin Wright, managing director, Petro-Canada Lubricants Europe. We are investing in local infrastructure and expanding our long-term partnerships with Standic and Staalduinen Logistics [and building] new tanks to meet the immediate and long-term needs of our European distributors and customers.

The company has also updated its promised delivery time for bulk products. Full-truck deliveries for the highest-demand bulk products will now be ready for transport in two days. This means bulk delivery within just three to four days for countries such as Germany, France, Belgium and Denmark. Petro Canada said in its news release that the number of products available in bulk will more than double in 2015, and the expansion plan has commitments to double the product offering again by 2020.

Fuchs Expands in Scandinavia

Fuchs Petrolub acquired Sweden-based Statoil Fuel & Retail Lubricants AB for an undisclosed amount. Subject to approvals and conditions, the deal is expected to be completed before the end of 2015.

With this acquisition, the Fuchs Petrolub Group is strengthening its presence in Scandinavia and establishing itself as one of the leading lubricant companies in this region, Fuchs stated in a news release. At the same time, Fuchs is expanding its market position in Poland and Russia and will now be present in the Baltic States.

SFR Lubricants manufactures automotive and industrial lubricants and greases, including metalworking fluids. In the financial year 2014-2015, SFR Lubricants generated sales revenues of 140 million, about two-thirds of which could be attributed to Scandinavia, with the remaining third attributed to Eastern Europe. The company employs 470 people and maintains a production site in Nynashamn, Sweden, near Stockholm.

Quaker Chem Acquires Grease Maker

Quaker Chemical Corp. acquired Spanish industrial lubes and grease company Verkol for U.S. $32.4 million. Verkol – based in Bera, in Northern Spains Navarre region – said the acquisition is a good fit for both companies as it will help each add new products, customers and expertise.

Verkol is a market leader in specialty grease and lubricants for the Spanish market, said Quaker CEO and President Michael F. Barry in a press release. Verkol has exceptional grease manufacturing capabilities and research and development facilities, he added.

This acquisition helps us expand our specialty grease platform by providing Quaker local grease manufacturing in Europe as well as giving us additional grease product technology and talent, he continued. Verkol also brings unique technology in continuous [die casting metalworking fluids] that will provide us with opportunities to cross-sell to our global steel customer base.

Russian PAOs Return in December

Russian oil major Tatneft and subsidiary Nizhnekamskneftekhim announced plans to restart polyalphaolefin production at its plant in Nizhnekamsk, Republic of Tatarstan, which has been idle for five years. The 9,600 ton-per-year base oil plant will produce an array of products, including 2-, 4-, 6- and 12-centiStoke PAO as well as a 20-cSt stock that was not available before 2010.

The capacity for the first range of products [2- to 12-cSt PAO] is 3,100 t/y, while the capacity for the 20-cSt product is 6,500 t/y, Gabbas Ilyasov, Nizhnekamskneftekhims deputy director for development, told GBCs Base Oils, Lubricants and Fuels conference in May. The start of production for the first range of products is set for the years end – latest December – the 20-cSt product launch will happen in the first quarter of 2016.

In addition to PAO production, the company is set to supply finished lubricants as well. The plant is getting ready to produce synthetic and semisynthetic oils, with a starting capacity of 10,000 t/y with the possibility of expanding to 30,000 t/y, according to Ilyasov.

Besides products formulated with the in-house PAO base stocks, such as vacuum, refrigerator, transmission or gear oils, Nizhnekamskneftekhim is planning to use 2.5-cSt API Group II and 4-cSt Group III base oil supplied by its parent company to produce automotive and industrial lubricants. The advanced formula of our 20-cSt Group IV base stock is great for formulating high quality transmission and gear oils as well as greases, or as a component for formulating of synthetic and semi-synthetic oils, Ilyasov said.

Total Boosts Singapore Capacity

Increasing demand from the shipping industry for Totals marine lubricants in the Asia-Pacific region was a significant factor in the companys decision to open its largest lubricant blending plant in Singapore. The facility, in the Singapore Lube Park in Tuas South, has an annual production capacity of 310,000 metric tons, the company said in a news release.

The new facility will produce lubricants for a wide range of segments, including automotive (two wheelers and cars), industrial as well as marine. Total intends to double its Asian sales, with production from the new plant accounting for a majority of the accelerated growth, the company said.

Total Lubmarine supplies 75 types of marine lubricants including cylinder oil for slow-speed engines running on ECA fuels below 0.1 percent sulfur, EAL-compliant lubes as well as greases, compressor, hydraulic and refrigeration oils.

Russia Lowers Lube Export Tax

The Russian government imposed a new petrochemical industry taxation rule that envisions a gradual decrease of the export tax for crude oil and petroleum derivatives such as fuels and lubricants. Beginning in January, the government issued a monthly rate index tied to crude oil price fluctuations on international markets. The Finance Ministry announced a significant decrease in the export taxes that took effect in August.

On August 1, the crude oil export tax dropped to U.S. $133.10 per metric ton from $142.10/t in July, according to reports in some Russian media. The fuel export tax rate dropped to $103.80/t from $111.60/t in July, while the export duty for lubricants and other petrochemicals came down to $63.80/t from $68.60/t in July.

Under the new law, the export tax rates on crude oil, fuel, lubricants and other oil products is set to gradually decrease by more than half by 2017. During 2015, the duty for lubricants and other oil derivatives should stand at 48 percent of the crude oil export tax. In 2016, it is due to decrease to 40 percent, and it will come down to 30 percent in 2017. However, this relief was offset by a 70 percent increase in the tax for mineral extraction that went into effect in January as well.

The industry expected that the growing production cost for oil products tied with the increased mineral extraction tax could balance with the lowered fuels and other oil derivatives tax excise, Tamara Kandelaki, head of Moscow-based InfoTek consultancy, told the GBCs CIS Base Oils, Lubricants and Fuels conference in Moscow in May. It is a bad idea, though. It seems that the high-profile ministerial departments are not aware of such [economic] terms as export parity, netbacks and premiums in the domestic market.

Russias gross domestic product is slated to contract by about 3 percent this year. Energy giants such as Rosneft and Gazprom significantly slashed their refining and pipeline investment plans. Other oil majors such as Lukoil, Gazprom Neft and Bashneft face fiscal problems due to the rubles devaluation caused by the weak economy, low crude oil prices and international sanctions imposed on a number of Russian energy companies and banks.

BASF, Petronas Partner on PIB

BASF and Petronas Chemicals Group Berhad will build a new production plant for highly reactive polyisobutene (HR-PIB) at the site of their existing joint venture in Kuantan, Malaysia. The plant will have a total annual capacity of 50,000 metric tons of HR-PIB and is expected to start production in the fourth quarter of 2017. HR-PIB is an intermediate product for manufacturing high-performance fuel and lubricant additives, including additives for sludge prevention.

Aemedsa Signs with Sea-Land

Sea-Land Chemical Co. has entered into a distributor agreement with Aceites Especiales Del Mediterraneo, S.A. to represent the companys natural sodium sulfonate business in the United States and Canada. Aemedsa, located in Cartagena, Spain, manufactures white mineral oils and natural sodium sulfonates. Sodium sulfonates are used to make overbased additives that fight acids and corrosion in metalworking fluids, as emulsifiers and as rust inhibitors. The company has plans to increase its production capacity by 80 percent by 2017 to serve new markets and find new uses for its products.

Hydrodec Leases Rerefinery Site

Hydrodec Group plc announced its rerefining subsidiary has entered an agreement for lease with The Manchester Ship Canal Company Ltd. for a proposed long-term lease of a 9 acre site near Eastham Locks, Port Wirral, Merseyside, North West England. The site would be used for the first phase of the companys development of a used oil rerefinery in the U.K.

Completion of the lease is dependent upon obtaining a satisfactory Development Consent Order under the Nationally Significant Infrastructure Projects planning regime, the necessary regulatory consents, licenses and permits for construction and operation of the development together with funding. Subject to completion of the first phase development within three years of the commencement of the Lease, Hydrodec has the option to enter into a long-term lease for an adjacent 7-acre site.