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Hurricane Pain Persists for PAO

Extensive flooding from Hurricane Harvey, which raged across the Texas and Louisiana coasts in late August, exacted a heavy toll on U.S. polyalphaolefin producers, leaving industry sources to speculate that supply disruptions could last until December.

Chevron Phillips Chemicaldeclared force majeure in September on polyalphaolefins and metallocene PAO produced in North America. It also makes PAO in Beringen, Belgium. Harvey also forced the shutdown of ExxonMobils Baytown refinery, which includes a 50,000 metric ton per year high-viscosity PAO plant operated by ExxonMobil Chemical, and of the companys Beaumont refinery, which has a 146,000 t/y PAO plant. ExxonMobil stated in late September it was making good progress toward restoring those Texas operations to pre-storm levels.

Ineos Oligomers said its PAO plant in La Porte, Texas, which has 105,000 t/y of low-vis capacity, was not impacted by the storm, but it did have to cope with logistical disruptions.

The hurricanes record flooding caused Chevron Phillips Chemical to close its Cedar Bayou (Baytown) petrochemical facility, which is home to a 58,000 t/y PAO plant. The company notified customers of force majeure on all Synfluid PAO and Synfluid mPAO produced in North America until further notice, adding that it was evaluating the expected duration and would provide updates as information became available.

China Cracks Down on Teapot Refineries

Regulators in China forced a number of base oil plants in the country to shut down in September. Most are small and low-tech, but observers said their collective volumes were significant and that the shutdowns affected local prices.

Industry sources said these crackdowns caught up a large number of facilities engaged in various types of petroleum processing, particularly teapot refineries, which are generally small and sometimes illicit businesses that use techniques such as acid pickling and furfural refining to make oil products, rather than more modern refining processes.

The actions against base oil plants are part of a broader campaign from the Ministry of Environmental Protection targeting a wide range of industries and intended to address air pollution and other environmental problems in China.

Sources said the governments crackdown also sidelined some more conventional base oil plants, and that the overall constriction in supply was enough to raise prices of certain API Group I grades in August. Some closed plants were said to be working to make internal improvements, but others closed for good.

Lanxess to Shutter Ankerweg

Lanxess plans to terminate PAO production at a recently acquired Netherlands site by November 2018. The former Chemtura polyalpha­olefins plant produces base oils for industrial lubricants and active ingredients for an agrochemical company.

After acquiring Chemtura in April, Lanxess conducted an analysis of its production sites and determined the Ankerweg, Netherlands, plant cannot be run on a competitive basis. The facility has capacity to make 15,000 metric tons per year of PAO.

Lanxess can produce the volume of base oils it needs to cover its own demand for the production of high-performance lubricants as well as market demand at its Elmira site in Canada, the company said.

Plants Revive in Eastern Europe

Russias historic Mendeleev fuel refinery and lubricant plant resumed operations after a two-year production halt. Ukrainian lubricants maker Azmol also recently resumed production after a restructuring, following several years of dormancy.

Oleg Krasnonos, general director of the Konstan­tinovsky, Yaroslavl Oblast-based Mendeleev refinery, said that the facility will restart finished lubricant production and produce rerefined base oils. The rerefining facility is scheduled to open in 2018.

Mendeleev halted operations in late 2015 due to raw material shortages, then filed for bankruptcy in February 2016, which led the refinerys creditor to assume the majority of shares. Credit Bank of Moscow has signed a contract with representatives of the Yaroslavl Oblast government to modernize the refinery, which has total crude oil refining capacity of 700,000 metric tons per year.

In Ukraine, Azmol restarted finished lube production at its facility in the port city of Berdyansk. It has been rebranded as Azmol-British Petro­chemicals, and the plants technological modernization is being led by Terry Dicken, owner of British lube maker Global Lubricants. He said that Global Lubricants is tasked with providing Azmol technical support for engineering, formulation of new lines of products, rebranding and marketing.

Russias Titan Gets into Grease

Russian petrochemicals manufacturer Titan is preparing to produce greases at its plant in Novocherkassk, which will have annual capacity of 12,000 metric tons.

Titan recently established its subsidiary, Novocherkassk Lubricant Plant, at the site of a grease production complex that has been idle for more than a year. It will restart production with a wide range of lubes and greases that Titan intends to supply to several industries in Russia, through a distributor network the company is creating.

Glencore Sinks Teeth into Africa

Swiss mining and commodities company Glencore is set to acquire a 75 percent stake in Chevron South Africa and the entirety of Chevron Botswana for $973 million. The deal is expected to close in mid-2018.

The remaining 25 percent interest in Chevron South Africa will be held by a consortium of Black Economic Empowerment shareholders and an employee trust, in accordance with South African regulations.

The businesses involved in the transaction include all of Chevrons manufacturing, retail and industrial supply operations in South Africa and Botswana. This includes a finished lubricants blending plant and laboratory in Durban, South Africa, and coastal shipping depots and pipelines with significant crude delivery and storage infrastructure at Saldanha Bay and Cape Town, South Africa, Glencore said.

Condat Broadens MWF Footprint

Condat Corp. acquired Saline, Michigan-headquartered Renite Co., expanding its range of metalworking fluids and forming lubricants for glass, forging and metal manufacturing applications. Terms of the acquisition were not disclosed.

The company, a subsidiary of Chasse-sur-Rhone, France-based Condat Group and which is also headquartered in Saline, said that Renites product range complements Condats glass lubes offering, and its presence in North America allows Condat to strengthen its diversification strategy in this region.

Briefly Noted

ExxonMobil is expanding its research and development facility in Clinton, New Jersey, expected to be completed by 2019. It will include a new engine testing center, a lubricant R&D blend plant and enhancements to accommodate employees relocating from the companys other research facility in Paulsboro, N.J.

Lubrizol opened a drum filling facility and warehouse in Painesville Township, Ohio, as part of a $100 million investment plan announced in April 2015. The combined 180,000-square foot facilities cost $70 million and will optimize packaging and storage of additive products.

German metalworking fluids manufacturer Oelheld opened a 24,000-square foot manufacturing and warehouse facility in West Dundee, Illinois, that houses increased production capacity and storage, an R&D lab and a tanker unloading station.

KLK Oleo built a 10,000 metric tons per year specialty esters plant in Klang, Malaysia, increasing total esters production capacity by 40 percent to 35,000 t/y at its four plants.

Pugh Lubricants and Apollo Oil, which joined forces in March, acquired Birmingham, Alabama-based lubricants, fuels and diesel exhaust fluid distributor Veterans Oil, which covers the Alabama and Georgia markets.

Lubricant and fuel formulator BASF has opened a lab in Navi Mumbai, India, under its BASF India subsidiary. The labs focus is developing and testing oil packages for turbines, tractors, hydraulic and compressor applications.

Aviall Services Inc. has been selected to distribute ExxonMobil aviation lubricants in Australia and New Zealand.

Faces in the News

Chevron Corp. and its affiliate Chevron Oronite announced several changes to leadership roles. Oronite president Desmond Des King will retire Feb. 1 after 36 years with the company. He will be replaced by Bruce Chinn, general manager of Chevron Corp.s Pascagoula, Mississippi, refinery, effective Jan. 1. Michael K. Wirth, vice chairman of Chevron Corp.s board and executive v.p. of midstream and development, was elected chairman and CEO of Chevron Corp., effective Feb. 1. He succeeds John S. Watson, who will retire after 37 years with the company.

Valvoline chairman William A. Wulfsohn stepped down from the companys board of directors in September. Wulfsohn, who is also chairman and CEO of Valvolines former parent company Ashland Global Holdings, guided the company through its initial public offering last year. Stephen F. Kirk, who once helmed Lubrizol, was named to replace him as Valvolines chairman.

Brandt Jensen joined Hydrotex as Utah division partner, where he will serve the companys fuel, food processing and freight customers in upper and eastern areas of the state.

Fluitec recently appointed Pierre Vanderkelen CEO. He has served in numerous roles in the company since 2009, including regional sales manager in Europe, general manager for Fluitec in Asia-Pacific and most recently v.p. of international sales.

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