Forward to friend Subscribe contact OATS alt oats Issue Number 67 - September 2005

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Contents
1. US EPA to define new international emissions tests for motorcycles
2. Total signs Neste Oil agreement towards new biodiesel plant
3. Get more lubes information from LubriTec
4. Chrysler licenses ATF-4
5. ExxonMobil seeks African-American entrepreneurs for US dealerships
6. Prices set to soar in the wake of Katrina
7. PKN Orlen and Agrofert in Unipetrol deal
8. Chevron merges with Unocal in growth area
9. South African-built charity BMW raises £38,000
10. An overview of REACH – important ongoing implications

1. US EPA to define new international emissions tests for motorcycles

In the United States, the Environmental Protection Agency is planning to make changes in emissions testing for new motorcycles. The aim is to 'accurately reflect current driving characteristics, to better reflect real-world conditions'. The EPA has not yet finalised the new test cycle regulations, for which it claims international approval, although it says that both public health and the environment will benefit from emissions control through better testing procedures. It also maintains that by adopting a universal testing procedure, the motorcycle industry can become more efficient. The internationally recognised regulation that the EPA proposes, also has the support of Canada, China, France, Germany, Japan, and several other countries. Experts from eight countries are involved in developing the tests, together with the European Commission, and input has also been drawn from the 'motorcycle and emission control technology manufacturing industries, as well as from motorcycle drivers'. The EPA plans to issue full details in 2006. When in force, the regulations will be used to certify that new on-highway motorcycles meet US emissions standards. Motorcycles already on the road or certified for sale in the USA will not be affected by the proposed regulations when they come into force.

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2. Total signs Neste Oil agreement towards new biodiesel plant

Total has signed a memorandum of understanding with the Finnish oil company, Neste Oil, with the aim of jointly studying how they might build a production plant for a new generation biodiesel product, to further satisfy what Total sees as the growing needs of the diesel market. According to Total, the unit would be based at one of its refineries in Europe, and would begin production in 2008. Total also claims to be the European leader in biofuels, which it has promoted in France for more than ten years: specifically of biodiesel by incorporating rapeseed methyl esters in its diesel fuels. The tie-up with Neste Oil is in addition to Total's recent agreement with Sofiproteol/Diester Industrie on the supply of rapeseed methyl esters. The biodiesel proposed for the new production plant would be manufactured using a wide range of vegetable oils and animal greases. Total says that engine tests conducted by independent laboratories show that there is a significant improvement in the performance of diesel fuels containing the new generation biodiesel. It also confirms that this product 'in association with fatty acid methyl esters, will contribute to achieving 5.75 per cent of biofuels by 2010, which is the recommendation of the European Directive 2003/30/EC.

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3. Get more lubes information from LubriTec


Looking for more on-line lubes and lube industry related information? OATS has arranged for Bulletin readers to be able to sign up for a free copy of the OEM/Lube Industry Newsletter that is published and emailed by LubriTec Lubrication Technologies, Inc., of Houston, Texas. They issue a newsletter weekly, alternating between an international edition and one with a North American bias. The contents include lubricant industry related OEM news (OEM lubricant approval announcements, OEM name changes and buy-outs, etc.), industrial mergers and acquisitions, JVs, corporate name changes, new plant openings, plant closings, base oil prices, and synthetic lubricant cross reference charts. Click here for a sample copy or more details. LubriTec newsletter

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4. Chrysler licenses ATF-4

Major oil companies and independent lubricant manufacturers who apply to blend and/or package the Chrysler Group's advanced, synthetic automatic transmission fluid, ATF+4, will now be licensed to do so. From 1 September 2005, the fluid will be available for retail outlets to sell, and independent vehicle workshops to use in Chrysler, Jeep, and Dodge vehicles. At the same time, its predecessor, ATF+3, will be phased out. The company is to issue ATF+4 licences to approved blenders, who will be free to sell into the marketplace, and will separately license re-branders who obtain their supplies from the approved blenders. ATF+4 contains an additive package that was developed in conjunction with Lubrizol. According to Chrysler, licensing is in response to marketplace demands and evolving vehicle technology. However, there are other considerations, including the extent to which independent workshops are using transmission fluids that are neither licensed nor specifically developed for Chrysler vehicles. ILMA has given a qualified approval of Chrysler's decision, but wants to see how satisfactorily it works in practice. Two years ago, ILMA, on behalf of its members, filed a charge of unfair trade practices against Chrysler, claiming that the company was not making the ATF+4 specification available to independent suppliers.

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5. ExxonMobil seeks African-American entrepreneurs for US dealerships

In the US, ExxonMobil is collaborating with the National Urban League to help identify and attract minority dealers and distributors to own and operate Exxon and Mobil service stations. Established in 1910, the NUL is America's oldest and largest community-based movement devoted to empowering African-Americans to enter the economic and social mainstream. Its key objective is to 'expand economic empowerment' and, according to Marc H. Morial, its President and CEO, the new programme provides 'a focused commitment to assist African-Americans in pursuing entrepreneurial opportunities with ExxonMobil'. The oil company sees the programme as, in the words of Mark Shores, its director of Retail Sales for Fuels & Marketing, 'a great opportunity to help create awareness and interest in retail business opportunities at ExxonMobil among minority candidates'. The company is looking for such people who 'want to be involved in all aspects of gasoline and convenience store retail marketing, from owning and operating a single service station, to investing and becoming the principal operator of a multiple location dealership'.

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6. Prices set to soar in the wake of Katrina

According to analysts, hurricane Katrina, which had such a devastating affect on oil installations in the Gulf of Mexico, could continue to dominate the US economy well into 2006. About one quarter of the country's oil and gas comes from this region, which has the capacity to produce 1.5 million barrels of crude oil each day. It is thought about ninety per cent of oil production has been affected in some way. Apache, for example, lost eight platforms in the Gulf, BP and Royal Dutch Shell each had plant that was severely damaged or lost, and although relatively unscathed, ExxonMobil lost 45,000 barrels per day.
Several days after the event, nine Gulf refineries were still closed down, and it is likely to be refining and distribution that continues to suffer worst in the long term. It could take several months to assess the damage to pipelines in particular, and to get the necessary finance in place for the remedial work. In the meantime, the cost of fuel to the motorist will inevitably rise steeply. Analysts say, however, that losses in production volumes will probably be offset by what they anticipate will be soaring prices for the refined lubricants. Lube Report from Lubes 'n' Greases has a very detailed article on Katrina's immediate impact. Visit Lubes 'n' Greases

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7. PKN Orlen and Agrofert in Unipetrol deal


Polish oil company PKN Orlen has submitted an application to buy Unipetrol of the Czech Republic, and, as part of the deal, to sell some of Unipetrol's assets to Agrofert Holding, a.s. The latest submission made by the organisation also includes an offer for shares in two other companies, Paramo and Spolana. This follows PKN's purchase, earlier in the year, of Unipetrol shares then held by the Czech Government, giving the Polish oil company nearly a sixty-three per cent share. It turned PKN Orlen into one of the biggest petrochemical groups in the region. Agrofert is the second largest petrochemical group in the Czech Republic, and would only acquire those assets that PKN Orlen does not consider essential to its own activities. However, PKN Orlen recently said that no agreement has been signed between Unipetrol and Agrofert concerning the selling-out of assets. It has been reported that Agrofert is also to purchase the shares and liabilities of some firms that were dependent on Unipetrol. According to PKN Orlen, 'most of the information concerning the agreement is secret' and 'in the case that information is revealed, the company will have to pay compensation'. PKN Orlen says that it has applied for permission to announce such details, but this has been refused.

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8. Chevron merges with Unocal in growth area

Chevron Corporation, based in San Ramon, California, has completed a merger with Unocal, thereby acquiring 'high quality operations in Asia Pacific, the Caspian and the US Gulf of Mexico', which were Unocal's key areas of operation. The first mentioned is thought to be potentially one of the world's strongest economic growth areas, and it is intended that the combined company will generate more than twenty per cent of its equivalent daily crude oil and natural gas production. Overall, it is expected to produce about 2.8 million barrels of oil-equivalent per day, including production from oil sands, that from operating service agreements, and the company's share of production by equity affiliates. This will improve the company's reserves by more than fifteen per cent.

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9. South African-built charity BMW raises £38,000

One of BMW's 'Democracy Cars' has been sold to a mystery bidder for £38,000 at Madame Tussaud's in London. These cars - ten BMW 318i vehicles - were all built by workers at the carmaker's Rosslyn Plant near Pretoria, South Africa to raise money for international charities. BMW and its suppliers gave parts and components at no cost, and the workers gave their time for free to build the cars. The aim was to celebrate the tenth anniversary of the first democratic elections to be held in South Africa, and Nelson Mandela's signature is in each of the vehicles on an interior trim panel above the glove box, next to a plaque that verifies its authenticity. Proceeds from the Madame Tussaud's action went to the Nelson Mandela Children's Fund, and the UK children's charities Norwood, and Shine.

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10. An overview of REACH – important ongoing implications

Readers of OATS Bulletin will be familiar with REACH - the proposals for regulating chemicals in Europe - and will be aware that organisations in the lubricants industry are increasingly concerned about the implications for their businesses. The August 2005 issue of Lube 2005 - the European Lubricants Industry Magazine - includes an overview of the proposals and the current situation based on a presentation by David Needle, President of the United Kingdom Lubricants Association. Copies of Lube 2005 may be ordered from UKLA, Berkhamsted House, 121 High Street, Berkhamsted, Hertfordshire HP4 2DJ. Tel: +44 (0) 1442 230589. UKLA

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