Market Topics

Boosting Baytowns Base Oil


ExxonMobil plans to expand API Group II and II+ production capacity at its Baytown, Texas, base oil plant by early 2015. The project will add a new Group II base stock designed for blending heavy-duty engine oils, and an improved Group II+ offering with enhanced low-temperature properties for optimizing engine oil formulations. Construction could begin late this year, subject to funding and regulatory approval, and startup is targeted for early 2015.

About 300 people will be employed during the year-and-a-half-long construction project, George Arndt Jr., general manager of global base stock and specialties for ExxonMobil Fuels, Lubricants and Specialties Marketing Co., told LubesnGreases. We expect to meet contractual commitments to customers throughout the construction period.

In its February announcement, the company said the expansion will significantly increase output of Group II and Group II+ base stocks and will employ ExxonMobil proprietary technologies, including MSDW dewaxing catalyst, for improved low-temperature performance. It declined however to disclose the size or cost of the increased capacity.

According to Arndt, the project will make a 4.5 centiStoke Group II+ and a 6.5 cSt Group II grade, branded respectively as EHC 45 and EHC 65. His company plans to issue the Group II+ product specifications in late 2013, he added.

Baytown will continue to make its Group I Core 600 grade, as well as Core 2500 bright stock. This project does not have a material impact on Group I production capabilities at Baytown, ExxonMobil spokeswoman Rachael Moore said.

According to the American Fuel & Petrochemical Manufacturers 2012 Lubricating Oil & Wax Capacities Report, the Baytown plant now has 9,800 barrels per day of Group I and 11,700 b/d of Group II capacity. The Group II output already includes some Group II+, which Baytown has produced for more than 13 years, Charles Baker, distinguished engineering associate with ExxonMobil Research and Engineering, reminded LubesnGreases.

To be clear, there is no formal definition of Group II+ given by API or ATIEL, he acknowledged. Group II+ is a term that has been used by the industry to differentiate between lower performing and higher performing Group II base stocks.

Viscosity Index (V.I.) is most often used to differentiate Group II and Group II+. Base stocks with a V.I. in the higher range of 110 to 119 are typically considered Group II+, Baker pointed out. However, the real distinction is that a Group II+ base stock has a superior Noack volatility/ Cold Cranking Simulator relationship, which enables blending lower viscosity grade engine oils with limited or no Group III corrector stocks, he explained.

William Downey Jr., a partner in Roland Bergers Oil and Chemical Competencies Center, told LubesnGreases that ExxonMobil has optimized its Group II+ base oil for multigrade passenger car motor oils like SAE 5W-XX, focusing on getting the tradeoff correct between Noack volatility and low-temperature properties.

He noted that Group II base oils may range from 80 to 119 V.I., according to the American Petroleum Institute, but a V.I. of 120 and higher is what distinguishes Group III base oils. If you talk to people who are expert in formulating these 5W engine oils, the difference between 119 and a 120 V.I. is not really particularly significant, Downey said. The Group II+ suppliers – ExxonMobil is one of them – have really tried to advance that the line of 120 is an arbitrary line, given the performance requirements today.

Downey said the 120 V.I. demarcation between Group II and III might have made sense at one time, but given the refining technology, that line is a bit more arbitrary now. What you have seen is people talking about the requirements of the products as formulated. Many Group II+ properties – such as volatility, low-temperature capabilities, high temperature/high shear viscosity and others – have been optimized to meet PCMO requirements, he explained. So thats certainly why they would be talking about adding Group II+ capacity, recognizing that it costs more for a Group II refiner to make Group II+ than Group II. If you look across the other Group II suppliers, youll see the amount of Group II+ or Group III they make available is actually pretty small.

As industry standards continue to become more demanding, Baker said, ExxonMobil expects that Group II+ base stock properties also will need to be adjusted, to meet new product requirements.

Our planned Baytown project will not only increase our Group II+ capacity, but it will also yield an improved EHC 45, which has been designed with this outstanding Noack volatility/CCS relationship, he stated. Our technical analysis has shown that our new EHC 45 Group II+ base stock can be used in many cases in place of Group III, such as when blending 5W SAE viscosity grade PCMOs. We believe that over time, EHC 45 will reduce cost and operational complexity for our customers.

He also noted that because EHC 45 is part of ExxonMobils global Group II slate, blenders who formulate worldwide can take advantage of API Base Oil Interchange and Viscosity Grade Read-Across guidelines to extend their product formulations to higher viscosity engine oils with little or no additional engine testing required.

Baker explained that the company has designed the EHC product slate for blending the heart of the finished lubricants market. In North America, primary automotive grades targeted are 5W PCMO and 15W-40 heavy-duty engine oils, he said. ExxonMobils analysis of publicly available data has shown that North American demand for these automotive engine oils will remain robust for many years to come.

The new Group II+ EHC 45 has been designed with improved low-temperature properties, as well. In fact, our technical analysis has shown that our new EHC 45 can be used in many cases in place of more expensive Group III corrector stocks, said Baker.

Also coming is EHC 65, a new product that will replace EHC 60. It is a superior Group II base stock targeting heavy-duty engine oils, Baker said. Designed with a slightly heavier viscosity than our current EHC 60, it optimizes 15W-40 HDEO blending by eliminating the need for an additional higher viscosity component. And, when EHC 65 is blended with the new EHC 45, it enables 10W-30 HDEO, helping to meet future generation needs.

ExxonMobil today is the largest U.S. base oil refiner, with total capacity of 47,500 b/d. ExxonMobils other U.S. plants are in Baton Rouge, La. (14,500 b/d Group I and 1,500 b/d Group II capacity) and Beaumont, Texas (10,000 b/d Group I).

Looking at the projects outline, one industry source surmised, the installation of an MSDW (hydroisomerisation) unit implies they see value in upgrading their slack wax to Group II base oil. Another industry source suggested the Baytown expansion likely reflects the difficulty in selling light-to-mid-vis Group I base stocks. The demand for bright stock and heavy Group I neutrals is still there, but with excess Group I capacity in Europe and the lack of demand for Group I light-to-mid-vis products in North America, it is possible upgrading to Group II/II+ was the only way for ExxonMobil to sell these stocks, this source told LubesnGreases sister publication, Lube Report. It also helps fulfill a need internally for ExxonMobil. They have a very robust demand for 6 cSt product internally for their heavy-duty business, so this helps supply that demand. I suspect a good portion of whatever their capacity is will be used internally.

This source considered the Group II+ expansion an oddity, pointing out that, with all the new Group III plants being built now and in the future, many industry experts are projecting Group II+ will eventually wither away to nothing.

Related Topics

Market Topics