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Phillips 66 Snaps

Up Spectrum

Phillips 66, owner of the Kendall, Phillips 66, Conoco and 76 Lubricants brands, is enlarging its footprint in both base oils and finished lubricants. On the finished lube side, the company is buying lubricant blender and packager Spectrum Corp. from Dominus Capital L.P., in a deal expected to close in the third quarter. Terms are undisclosed. The acquisition will increase Phillips 66s access to global lubricant markets, said company president Tim Taylor, and is in line with our strategy to selectively grow our Marketing and Specialties segment.

Memphis, Tenn.-based Spectrum makes automotive and other lubricants including two-cycle, small-engine and hydraulic oils, and also supplies the private-label market.

In the base oils area, Phillips 66 opened a new supply point in Houston for API Group III base oils from South Korean refiner S-Oil. Accessible by truck, rail and barge, the new outlet expands Phillips 66s existing Group II and Group III base oil network and creates new logistics options for customers, it said.

The new Houston supply point complements our current supply chain and aligns with our continued promise to offer customers exceptional business continuity strategies, said Jay Hong, manager, base oils and special products. Its other supply points are Los Angeles, New Orleans, Savannah, Ga., and McKees Rocks, Pa.

BASF to Up PAG Capacity

BASF is investing E10 million ($13.6 million) to construct a new polyalkylene glycol based lubricants manufacturing facility in Ludwigshafen, Germany, with startup due by the beginning of 2016. The plant, which will be built on existing property at BASFs integrated Verbund complex, will produce PAG base stocks along with formulated lubricants.

PAG base stocks are used for synthetic lubricants such as gear oils, compressor oils, metalworking fluids, and fire-resistant hydraulic fluids. Integration at BASFs Ludwigshafen site means that the chemical giant can support the production unit with its own raw materials necessary for PAG production, including ethylene oxide and propylene oxide.

According to LubesnGreases, BASFs existing PAG plants in Germany have a combined 22,000 metric tons per year capacity; it also has two U.S. plants with a combined 60,000 t/y of PAG capacity.

PAO Streams in China

The world has a new source of high-viscosity polyalphaolefin, thanks to the recent startup a PAO plant in China. By early July, officials with Naco Lubrication Co. Ltd. told LubesnGreases, their Shanghai facility will be making commercial volumes of high-viscosity PAO and other components used in making synthetic lubricants.

The PAO plant – Chinas first – will help meet the worlds growing appetite for high-quality lubricants and additives, said Zhongwen Liu, Naco Lubrications deputy general manager. In addition to 15,000 metric tons per year of PAO, the plant will make 10,000 t/y of alkylated naphthalene, alkyl benzene and other specialties. The facility will make three high-vis PAO grades for sale under the SinoSyn trademark, added Qingcai Liu, manager of Nacos marketing department. These include a 150 centiStoke PAO intended for Chinas market, plus 40 and 100 cSt PAO and a light-colored alkylated naphthalene (AN23) that will be made available to other markets, starting with North America. These synthetic base oils go into engine oils, industrial gear oils and lubricating greases.

Novitas Chem Solutions in Bellaire, Texas, near Houston, has been signed to represent the products in North America. Liwen Wei, Novitas managing director, noted that Naco has done business as an international trading company since 1998, and is one of Chinas largest importers and distributors of polyisobutylene used in lubricant manufacturing.

Acme-Hardesty Partners Elevance

Elevance Renewable Sciences Inc., which is creating specialty chemicals and lubricant components from natural oils, has commercialized Elevance Concert GC-350, a grease processing aid, and recently selected chemical distributor Acme-Hardesty to market and distribute it in North America.

Elevance Concert GC-350 is the newest addition to a growing portfolio of renewable, high-performance ingredient solutions for the lubricant and other industries, said Robin Weitkamp, Elevance senior vice president. The product targets the time-intensive process for making lithium complex greases, and can cut the time needed by as much as 25 to 35 percent per batch while also improving the solubility of the soap thickener and maintaining current grease yields, Elevance says.

Based in Blue Bell, Pa., Acme-Hardesty has been supplying renewable, biobased chemicals for more than 70 years, pointed out the companys Bryan Houston, and will be responsible for distributing the new processing aid to grease manufacturers throughout the United States, Canada and Mexico.

TPC Thinks Big on PIB

TPC Groups board in May approved funding for the engineering phase of a third polyisobutylene production unit at its Houston facility. PIBs are used as a chemical intermediate in making lubricant additives and as base stocks in lubricants. The funding amount was not disclosed.

Early last year, TPC began to debottleneck its existing PIB capacity and preparing to build additional capacity, TPC said in a news release. With demand growing for highly reactive polyisobutylene, TPC is in discussion with its customers regarding definitive off-take commitments for the third production unit, and agreements for these commitments are anticipated by the end of this year.

TPC also continues to debottleneck its existing PIB capacity. The company said it has increased capacity by more than 15 percent since 2012, and has additional debottlenecking under way this year. While it doesnt typically disclose its PIB production capacity, LubesnGreases previously pegged it at 117,500 metric tons per year; adding 15 percent lifts that above 135,000 mt/y.

J.A.M. Buys Fellow Jobber

Houston-based J.A.M. Distributing, a distributor of lubricants, base oils and fuels, agreed to acquire fellow Houston jobber Jones Oil. In a press release last month, J.A.M. said it will acquire substantially all assets of Jones Oil and its sister company, High Tech Equipment. J.A.M., which is owned by investment firm Ridgemont Equity Partners, did not disclose the cost of the acquisition, and noted the deal will close within 120 days.

Asian Plays for Infineum

Asia isnt lacking for the investment dollars of additive companies: Infineum broke ground in late April for a new additives blending plant in China, and two weeks later celebrated the completion of a major salicylate plant on Jurong Island, Singapore.

The $150 million Jurong project involved constructing the companys first salicylate plant outside Europe. It required the effort of 4 million man-hours and the construction lasted 24 months. Salicylates are used as detergents in engine oils and other lubricants, and the Singapore plant will become part of Infineums global supply chain for salicylates. The plant gets the bulk of its feedstock from ExxonMobil and olefins from Qatar, and makes calcium salicylates used in additives for top-tier passenger car lubricants, heavy-duty automotive applications and in four-stroke marine oils for container ships.

At the plants May 14 opening, CEO Xavier le Mintier commented, Infineums aspiration is to expand its position as a global leader in the transportation additive industry. Today we have made a major step in that direction by bringing together the most advanced technology, process design and best talents, here in the Asia Pacific region, here in Singapore.

Infineum also has established Infineum (China) Co. Ltd., its second wholly owned enterprise in China, and broke ground April 28 for a new additives blending plant in the Zhangjiagang Free Trade Zone. This will be its first wholly owned manufacturing base in China. The plants first phase, occupying about 100,000 square meters, is due to start formal production by the end of 2015. The plant will produce lubricant additives mainly to supply China and the wider Asia Pacific market.

FTC Urged: Squelch Kia

On May 27, the Auto Care Association, Automotive Oil Change Association, Service Station Dealers of America and Tire Industry Association together called on the Federal Trade Commission to take immediate action to have automaker Kia withdraw a technical bulletin advising consumers not to use non-OEM filters, saying it is clearly a violation of the Magnuson-Moss Warranty Act.

The bulletin, which was referenced in an article posted by Consumer Reports magazine, recommended that car owners either go back to the authorized Kia dealer for oil changes or use a Kia oil filter to avoid problems with oil- and filter-related warranty claims.

Two years ago, the four associations submitted a complaint to the FTC regarding a Kia technical service bulletin that authorizes dealers to deny warranty coverage simply based on the use of an aftermarket filter, without any determination that the filter actually caused a problem with the vehicle. This practice, they said, is clearly a violation of the MMWA. Despite the complaint, the groups May 27 letter to the FTC states, the FTC has yet to do anything to enforce the MMWA requirements with Kia. It notes that Consumer Reports echoed Kias advice in a widely seen article, further spreading the damage.

The Consumer Reports article told readers, If your Kia is still under the powertrain warranty, consider taking it to the dealer for oil changes. Yes, it probably costs more than the quick-lube store, but youll avoid any potential problems with oil- and filter-related warranty claims.

The main loser of course is the consumer who, as the CR article states, must now pay more for an oil change, the groups pointed out in their letter, which took the FTC to task for failing to act on their earlier request.

Daubert Adds Sulfonate Capacity

Daubert Chemical has completed a three-year expansion effort at its plant in Chicago, more than doubling its capacity for making calcium sulfonate. Daubert says its proprietary process produces high-quality calcium sulfonate products with higher ratios of active material than commonly available. Among these are pre-gelled calcium sulfonate grease precursors, which have undergone a unique crystallization process in Dauberts facilities that can streamline their use by lubricant manufacturers. Other applications for calcium sulfonates include rust preventives, metalworking fluids and gear oil additives.

Tianhe Floats IPO

In mid-June, Tianhe Chemicals conducted a long-awaited public stock offering, hoping to raise $636 million to $818 million on the Hong Kong Stock Exchange. Financial news outlets reported that prices obtained for the offered stock were at the low end of the range sought by the company. Tianhe, which is headquartered in Jinzhou, Liaoning Province, China, was hoping to get HK$1.75 to $2.25 per share; the actual realized was HK$1.80.

Tianhe, the worlds sixth-largest lube additive company and Asias largest, said it would use the proceeds to pay off debt and invest in its additive and fluorochemical businesses. All told, it aims to spend more than HK$1 billion on production facilities to make ashless dispersants in Bawang Village, Liaoning Province, to develop an additives plant in Qinzhou, Guangxi Province, and on research and development facilities.

Briefly Noted

Takreers flagship 600,000 tons per year API Group II/III base oils plant at Ruwais, U.A.E., is facing further delays and may not start production this year, according to an executive at Abu Dhabi National Oil Co.s marketing and refining directorate.

We expect production to start sometime in the fourth quarter, said the executive, who asked not to be named. It might be October, or it could be later. Takreer, which is wholly owned by Adnoc, is conducting trials to iron out technical problems, the spokesperson added.

Calumet Specialty Products Partners joined the Fortune 500 list of largest U.S. companies for the first time, at number 467.

Solazymes j.v. with Bunge Global Innovation has produced its first commercially saleable products, including algal oils and biodegradable drilling lubricant, at a new plant in Brazil. Using algae to transform plant-based sugars into oils, the plant in Sao Paulo state is now making both oil and Encapso brand drilling lubricant; it should reach nameplate capacity within the next 12 to 18 months.

JX Nippon Oil & Energy Corp. began commercial operations in May at its new lubricant factory in Haiphong, Vietnam. The Japanese energy giant is banking on the U.S. $10.1 million facility to help it gain a large chunk – some 10 percent – of the local market. It said the facility will reach full capacity of approximately 40 million liters per year in 2020. It employs 87 people and has filling equipment capable of filling 9,000 bottles per hour.

Japans Sanyo Chemical Industries Ltd. will build a plant in Jiangsu Province, China, with capacity to produce 5,000 tons per year of viscosity index improvers.

BP is consolidating its BP and Castrol brands of marine lubricants under a single brand: Castrol. The process started two years ago and will accelerate in coming months. Main-grade marine lubricants and services will move to their Castrol equivalents in the coming months.

Faces in the News

On Aug. 1, D.G. Jerry Wascom is expected to become president of ExxonMobil Refining & Supply and a vice president of ExxonMobil Corp. Wascom, 58, began his career with Exxon in 1979 at its refinery in Baton Rouge, La. (his hometown), and later took leadership roles in refining, engineering and global supply. Since 2009 he has been Refining & Supplys director of refining for North America.

Radco Industries, which makes specialty fluids and lubricants for the military, has tapped Tony Corscadden as executive vice president of operations. Hell take charge of all day-to day operations as Michael Damiani, president and CEO, continues to oversee the leadership team and manage new product development. Corscadden joined Radco in 2012, after more than 20 years in operations and manufacturing management.

Specialty chemical distributor Sea-Land Chemical Co. has hired Erin Thinschmidt as customer service specialist. She replaces Heather Reid, who moves to the Sampling department. With over 20 years of customer service and sales experience, Thinschmidt directly assists customers and also supports Sea-Lands sales force.

Industry veteran Phil Levy has joined Novitas Chem Solutions, which supplies specialty base fluids and additives. As national sales manager for the NAFTA region, he is responsible for sales to regional and national accounts, and will focus on industrial, grease and metalworking businesses.

Philip Kramer is the new vice president of business development at lubricant manufacturer Hydrotex. A Fort Worth, Texas, native, he has over 20 years of experience in strategic business development with companies that include Nokia, McAfee and Samsung; he most recently owned a hazardous materials decommissioning and disposal company.

Steven Mills, former chief financial officer at Amyris Inc., joined the board of Elevance Renewable Sciences, which is developing lubes and specialties made from renewable feedstocks. Prior to Amyris, Mills was executive vice president and CFO at Archer Daniel Midlands.

Luis Madeleno is now chief operating officer at Fortech Products, with oversight for operations in the U.S., Brazil, Mexico and Asia Pacific. His career has included roles with Sodecia, Benteler, GM and Delphi. Madeleno holds a law degree from Portugals Lisbon Univ. and an MBA from Catholic Univ. there.

Corrections

Mays article GTL: Elephant in the Room mischaracterized the gas-to-liquids process. GTL does not convert natural gas to synthetic crude as the articles text states, but to synthesis gas (CO + H2). The graphic on page 46 of the article was correct.

In Junes Product News section, Henkel Corp.s name and website were mispelled as Henckel. It is www.henkel.com.

Junes feature Nanolubrications Leap said that NanoMech Inc. has already had a product reach commercial use. The company has commercialized multiple products, not just one.

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