Chevron Corp. is selling its Benelux fuel filling stations to Delek Benelux B.V., a subsidiary of Israel’s Delek Group. The deal, arranged through Chevron’s subsidiaries in Belgium, Netherlands and Luxembourg, is expected to cost Delek $460 million, and to be finalised by autumn 2007. Chevron, whose subsidiaries carry on business in some 180 countries around the world, says that the sale is ‘part of its strategy to cut downstream activities in Europe’. The company has some 560 service stations – branded Texaco – in the Netherlands, of which 329 are owned by a number of joint ventures in which Chevron holds around 50% interest. It also has about 300 Texaco-branded service stations in Belgium, of which some 55% are Chevron-owned. Under the agreement, Delek will gain 803 service stations in the region, as well as two fuel terminals in Belgium and Luxembourg, and interests in six joint venture retailers in the Netherlands. Delek Petroleum Ltd owns the Israel Fuel Corporation Ltd., Israel’s second largest retail gas and lubricants supplier. Its other subsidiary, Delek US Holdings Inc., operates petrol stations and attached convenience stores in the southern United States, and a crude oil pipeline and refinery in Texas. The Benelux deal is part of Chevron’s programme for reappraising its strategic investments in Europe. This included, earlier this year, an agreement to sell their Dutch manufacturing business to BP plc for $900 million. More information at Chevron.com
In Pakistan, the retail price of lubricants rose by between 10% and 12% as a result of changes in the structure of central excise duty. The All Pakistan Lubricant Manufacturers Association has asked its government to reduce taxes on lubricants manufacture; it claims that such a move would attract more investment in the sector, and would help to curb the illegal smuggling of finished lubes. APLMA says that a major problem is the amount of finished lubricants that are being smuggled into the country from Iran. It has been lobbying Pakistan’s Federal Minister for Petroleum and Natural Resources, with a view to getting its government to waive customs duty and federal excise duty on the import of raw materials for lubes production. Some 392,000 tonnes of lubes are used annually in Pakistan; it is claimed that 140,000 tonnes of this is met from ‘smuggled and spurious products’. These are much cheaper to buy, and thereby considerably defraud the country’s exchequer. Dealers claim, however, that such imports are of poorer quality and are potentially damaging to vehicles. So far, the government has not acceded to the requests of its lubricants manufacturers, preferring to maintain that it has instructed all the authorities concerned to be very vigilant in their response to criminal activities. Commentators suggest that, in the near future, half of all lubricants used in Pakistan may be cheap, illegal imports. You can read recent articles about illegal lubricants in Pakistan at Business Recorder
3. Nanoil for automobiles The Tampa, USA-based Nano Chemical Systems Holdings, Inc. has announced the introduction of a 100% biodegradable nanoil for automobiles. It is, they say, a ‘nano-enhanced green motor oil that is non-toxic and biodegradable, thus eliminating the current disposal issues with present commercially available lubricants’. The company’s own news release, plus comment on its activities, can be read at www.autobloggreen.com
The German company RohMax Additives GmbH, part of the Speciality Acrylics business of the Düsseldorf-based company Degussa, has begun building a $13.5 million manufacturing facility at Jurong Island, Singapore. The plant is scheduled to open in 2008 and will be operated under the company name of RohMax Asia Pacific Ptd. Ltd. The company confidently predicts that the Singapore facility will be able to make sufficient quantities of its Viscoplex brand products to meet most of the current requirement for lubricant additives in automotive and industrial applications in the Asia-Pacific region, the Middle East and Africa. RohMax says that Asia is the fastest growing lubricants market in the world today, and the major growth expectancy there is likely to be in the automotive industry. Its new facility in Singapore is also expected to meet the needs of predicted lubricants growth throughout the region over the next ten years. More at: Singapore Economic Development
Sinopec – China’s largest petroleum and chemical company, the largest refiner of lubricants in Asia, and the fourth largest in the world – has established its first production base outside of its home country. It has set up its new manufacturing base for the Asia Pacific region in Singapore, which the company says will be ‘the first step of its strategy of international development’. The operation, which is expected to produce upwards of 7,000 tonnes of lubricants per year, has been outsourced to two established Singapore lubes-producing companies, ItalSing and AP Oil International. ItalSing was established in 1993 and is a joint venture between ENI International BV and Singapore Petroleum Company. AP – which began manufacturing in 1981 – set up the first home-based Singapore lubricants plant. Under the new arrangement, these companies will work with raw materials and technologies supplied by Sinopec, which is expected to set up its own plant there if the market proves to be as good as expected. Sinopec intends to expand in an Asian lubricant market in which the main players are currently Shell and ExxonMobil. More at: Singapore Economic Development
6. Lanka IOC increases production options in Sri Lanka Under an agreement between Indian Oil and the government of Sri Lanka, Lanka IOC Limited will be able to manufacture, blend, market, and export Servo-branded lubricants in Sri Lanka. (See OATS Bulletin No.81 for a note on the new Trincomalee plant, and the Sri Lankan lubes market.) Lanka IOC is a subsidiary of Indian Oil Corporation Limited in Sri Lanka, where retail petrol stations are otherwise operated by the state-owned Ceylon Petroleum Corporation. It has a one-third share in Ceylon Petroleum Storage Terminals Ltd, which is used for the storage and distribution of all petroleum products within the island nation. Part of Lanka IOC’s remit is to operate storage facilities at Trincomalee, which the island’s government has earmarked as a zone for economic and industrial development. The new agreement is seen as part of the company’s preparations for a state-of-the-art lubricants blending plant there – scheduled for August 2007 opening – inside the China Bay Tank Farm. On site will be a laboratory for testing base oils, additives and finished products. There are more than 2,000 formulations of Servo-brand lubricants, and the company is the market leader in India, currently having a 13% share of the Sri Lankan market. More on Servo lubes at: Indian Oil
Now that there is no acceptable engine test for it, API CF-4, the heavy-duty diesel engine oil category that was established in 1990, has now been officially declared as obsolete. The API will no longer accept new CF-4 licences, and all existing licences for it will expire on or before the last day of June 2008. Marketers who still have CF-4 brands will either have to upgrade to CH-4 or higher, or will be left with unlicensed product which will not be able to carry the API trademark ‘donut’ logo after the 2008 deadline. API CH-4 was introduced at the end of 1998. Tests are still in place that support the older CF and CF-2 categories, so these will continue to be licensed.
8. Passenger cars on new lubes course Passenger Car Engine Lubrication is a new topic that Chevron has added to the online training portfolio of its Lubricants University, the educational website for maintenance professionals. This course is aimed at giving a better understanding of the role of lubrication in achieving efficient gasoline engine operation and extended life. It ‘addresses gasoline engine lubrication performance issues, provides an overview of commercial gasoline engine lubricants, and offers a summary of lubricant performance specifications’. The training module also gives a brief history of the internal combustion engine, and compares gasoline and diesel engines. Chevron Lubricants University courses are available to the general public at a fee; details are available at Chevron University
Finland’s €20 million waste oil re-refining plant, to be run by L&T Recoil Oy – a joint venture between the environmental management specialists Lassila & Tikanoja and GT Trading Oy, the international marketer of oil products – is scheduled for completion at Hamina at the beginning of 2008. It will have a 60,000 metric tonnes capacity – about double the quantity of the used lubes currently being re-refined in Finland – and will produce base oil for the lubricants industry from various waste oils that will be collected from Baltic Sea countries. The company says that its target is Group II oil, and its aim is to sell the product in Finland, as well as abroad. Pöyry, the Vantaa-based global consulting and engineering firm, is to handle the engineering side of the plant, which they say has to do with environmental issues and safeguarding sustainable development. More at: Pöyry website
10. Deere to buy China tractor company Deere & Company, of Moline, Illinois, USA – the world’s largest manufacturer of agricultural equipment – has agreed to buy China’s Ningbo Benye Tractor & Automobile Manufacturing Co. Ltd. Benye is the largest manufacturer of tractors in southern China. The company was created as the Ningbo Agricultural Mechanism Factory in 1955, and has since had three changes of name; the last was in 2005. Deere is to create a wholly owned subsidiary, John Deere Ningbo Agricultural Machinery Co. Ltd, to manage the business, which, following government approval of the deal, is expected to be finalised later in 2007. Deere has been manufacturing in China since it formed a joint venture to build combines at Jiamusi, which it now wholly owns. The company sees the latest move as a means of expanding its range of vehicles in the Chinese market, using the new business as a way of increasing its means of manufacturing low horsepower tractors, and making its product more readily available to other parts of the world through its enhanced base in China. At the moment, Deere builds tractors in China at its joint venture factory in Tianjin, which are more powerful than those currently being made at Ningbo – and it is these that will increase Deere’s potential in the region because of increasing mechanisation by rice farmers. More at: John Deere
11. Toyota passes one million hybrids mark Toyota announced that the global cumulative sales of its Toyota hybrid vehicles have passed the one million mark, reaching 1,047,000 units by the end of May 2007. The company launched its Prius, the world’s first, and currently best-selling, mass-produced hybrid vehicle in Japan in 1997, and began selling it in Europe and elsewhere in 2000. The second-generation Prius, equipped with the Toyota Hybrid System II, was introduced three years later. The company’s hybrid vehicles are sold under the Toyota and Lexus brands in Japan and in more than forty countries and regions throughout the world. Toyota has calculated that its hybrid vehicles have ‘produced approximately 3.5 million fewer tons of carbon dioxide compared with the same class petrol engine vehicles of similar size and driving performance’. Its aim is to be achieving one million hybrid vehicles annually by the early 2010s. More at: Toyota Prius
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