The 24,000 square meter Beira Terminal will supply fuel and lubricants to the main hubs in Mozambique, as well as to other countries in Southern Africa where Engen has operations, including Zimbabwe.

Weve tested railway capabilities from Beira to Bulawayo in Zimbabwe and to Francistown in Botswana, said Drikus Kotze, general manager of Engens International Business Division. We can take some pressure off of our Durban refinery and supply Botswana and Zimbabwe directly from our new depot.

Engen began operations in Mozambique in 1996. Since then, the company has built up a retail network and diverse portfolio of commercial customers, including global mining companies. The company said it plans further investments to increase depot capacity in line with market demand.

U.K. Lube Demand Rebounding

Europe is the third largest finished lubricants region, consuming approximately 17 percent of the global demand. And while other European markets remain flat, the U.K., the third largest consumer of finished lubricants on the continent, is on the upswing due to a variety of factors, according to Kline & Co.s recently published Global Lubricants: Market Analysis and Assessment report.

The consumer automotive lubricants market in the U.K. is stable, forecast to increase at a compound annual growth rate of 1 percent to 2019. Demand for passenger car motor oil in the country accounts for approximately 84 percent of this segment. Following the global trend, the U.K. is migrating to lower viscosity grade passenger car motor oil, resulting in higher penetration of synthetics and semisynthetics. Original equipment manufacturer recommendations play an important role in driving this shift.

Sales of synthetic 0W-XX grades are expected to increase in an otherwise flat passenger car market, as OEMs shift to lower viscosity grades to improve fuel economy. Due to the increased presence of Asian OEMs in the U.K. and their tendency to recommend 0W for service fill, as well as European OEMs recommendations of 5W grades, the growth for these viscosity grades is forecast to accelerate.

According to Sharbel Luzuriaga, project lead in Klines Energy Practice, The good shape of the economy and enhanced consumer confidence encourage people to purchase new vehicles. On average, two million new units are projected to be registered in the United Kingdom through 2015, and 2016 is paving the way for increased use of low-viscosity, fuel economy grades…. The use of synthetic grades will lead to longer drain intervals and lower volumetric growth.

Do-it-for-me consumers represent the majority of the population. Franchised car dealers conducted an estimated 25 percent of overall installed sales in 2014. Within the installed segment, franchised car dealers have been eroded by the proliferation of independent workshops and the increasing tendency for consumers to patronize independent workshops.

Ashland to Spin Off Valvoline

Ashland announced in late Septembers that it will spin off Valvoline, saying the lubricants business is positioned for growth in quick lube and international markets. The plan also calls for Valvoline to become an independent publicly owned company and for the creation of a separate, new Ashland specialty chemicals company that would also be independent and publicly traded. Subject to final approval by Ashlands board and regulators, the change is expected to take at least a year to complete.

Separating into two companies will enable each to focus on its specific business and strategic priorities, Ashland Chairman and CEO William Wulfsohn said in a news release. For Valvoline, it means building the worlds leading engine and automotive maintenance business by providing hands-on expertise to customers around the world. Wulfsohn will serve as non-executive chairman of Valvoline following the separation, and Sam Mitchell, currently senior vice president of Ashland and president of Valvoline, will serve as CEO.

Valvoline has the opportunity to enhance its truly unique, multi-channel automotive maintenance biz platforms by continuing to deliver an outstanding customer experience for a diverse set of customers, expanding the instant oil change network, sustaining strong international growth, continuing migration to higher-margin synthetic oil and accelerating our position supplying the heavy-duty equipment segment, Wulfsohn said during a conference call.

Exol Boosts R&D Capability

Exol upgraded its Wednesbury and Rotherham, U.K., laboratories by adding a Mini Rotary Viscometer, Houillon VH1 Viscometer Bath, Brookfield Viscometer and Automated TBN equipment. The Houillon VH1 Viscometer Bath measures kinematic viscosity, the most common test done on quality control samples. Meanwhile, the Mini Rotary Viscometer measures the low-temperature pumping viscosity of engine oils, classifying them according to their ability to be supplied to the engines oil pump inlet.

The Brookfield Viscometer measures the low temperature viscosity of gear oils and automatic transmission fluids. Finally, the Automated TBN machine handles the solvents used, carries out the titration and removes the final mixture automatically, reducing operator handling of hazardous chemicals and also speeding up the test.

Sales Director, Steve Dunn, said: This new lab equipment is part of our continuous investment that has seen Exol invest more than 3 million in a new production facility, vehicle fleet and product packaging.

Sanctions Delay Russian PAO Restart

Tatneft pushed the restart of its polyalphaolefins plant in the Republic of Tatarstan to the spring of 2016 as the company has experienced procurement delays due to economic sanctions, an industry insider reported. The 9,600 tons-per-year facility is Russias only PAO plant and is operated by the oil majors Nizhnekamskneftekhim subsidiary. It has been idle for five years, and the company had aimed to restart production before the end of this year.

It is still not clear when production will restart because preparatory work is delayed due to the sanctions, said Oleg Tsvetkov, head of the lubricants department at VNIINP, the Moscow-based All Russia Research Institute for Oil Refining. The company is experiencing problems with the supply of automated systems for the plants processes management.

VNIINP is the primary technology developer of the plant in Nizhnekamsk that originally started to stream PAO in 2003. The plant produced a variety of 2- to 20-centiStoke PAOs.

Petronas Builds European R&D Center

Malaysias Petronas Lubricants International is building what it claims will be the largest lubricant research and development center in Europe – an 80,000 square meter facility in Turin, Italy. The center, scheduled to open in 2017, is described as the centerpiece of a strategy to boost the companys global network of R&D facilities.

Petronas is spending 50 million to construct the center and outfit it with multiple test cells to conduct fuel economy tests, emissions analysis and other tests in a variety of engines. Once the project is complete, the Turin lab will become its Global Technology Center. The company has satellite labs in four other countries – China, the United States, Brazil and South Africa.

Petronas is also investing in manufacturing capacity in Asias biggest lubricant markets. By the end of this year, the company plans to open a blending plant in Mumbai with capacity of 60,000 metric tons per year. It is also expanding a plant in Shandong province, China, which should have capacity of 150,000 t/y when finished in 2017.

Metall-Chemie Names Technical Services Head

Metall-Chemie GmbH & Co. KG has named Udo Rhrs as head of Technical Customer Services, effective 1 January. The company stated in a news release that by creating this new position…Metall-Chemie is pursuing its goal to expand its product portfolio in the lubricant additives segment and with regard to providing technical customer support. Rhrs has held senior positions at C.H. Erbslh GmbH & Co. KG and, most recently, DOG Deutsche Oelfabrik Gesellschaft f r chemische Erzeugnisse GmbH & Co. KG.

Tanzania Adds Base Oil Tariff

Tanzanias government introduced a 10 percent per gallon duty on base oils imported into the country, with an additional 1.5 percent railway levy duty. The duties on finished lubricants and additives remained unchanged at 25 and 10 percent.

Some local blenders raised concerns that the new tariff will hurt the competitiveness of locally blended lubricants. Irfan Khan, general manager for General Petroleums operation in Tanzania, said, It will surely affect our export orders, which we have committed to clients in neighboring African countries. We are afraid that the new tariff regime may open the Tanzanian market to a flood of imported substandard products from Middle Eastern and Gulf countries.

Samir Manik, group head of marketing at Oilcom in Tanzania, said the new duty on base oils, coupled with the falling exchange rate of the Tanzanian shilling against the U.S. dollar, exerts upward pressure on prices for finished lubes manufactured in Tanzania. Salum Bisrara, executive director for the Tanzania Association of Oil Marketing Cos., said, It is an act of parliament, and we have to accept it and join with the government for the prosperity of our country. Khan concurred, I think the Tanzanian government is doing enough to stabilize its currency against the U.S. dollar.