South Korea's SK Lubricants restarts Group III base oils plant

25 April 2012 11:43  [Source: ICIS news]

SINGAPORE (ICIS)--South Korea's SK Lubricants is restarting its two Group III base oil facilities at Ulsan after completing a maintenance shutdown that lasted more than four weeks, a company source said on Wednesday.

The two lines, which have a combined capacity of close to 1m tonnes/year, are undergoing test runs this week, the source said.  

SK Lubricants will be taking a 350,000 tonne/year Group III plant at Dumai in Indonesia off line in May for a turnaround.

The refiner’s heavy maintenance shutdown schedule has tightened the supply of Group III base oils in Asia, although new supply from the Middle East has helped cushion the impact of the lower production, sources said.

Finland’s Neste Oil started to export Group III base oils from its Bahrain facility to Asia and the Middle East in March, market sources said.

Its shipments to China totalled around 15,000-16,000 tonnes between the second half of March and the middle of April, and Indian buyers have booked at least 7,000 tonnes for loading in the second half of April.

"We are getting healthy quantities from Neste. This has made [us] less dependent on supplies from [South] Korea," an Asian buyer said.

Neste Oil’s 400,000 tonne/year plant at Sitra started commercial production in October 2011.

The plant is a joint venture with Bahrain Petroleum Company (Bapco) and the Bahraini government’s The Oil and Gas Holding Company (nogaholding).

By: Yeow Pei Lin

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