China’s Fangyu Lubricants delays start-up of new base oil unit

24 September 2012 09:17  [Source: ICIS news]

SINGAPORE (ICIS)--China’s Shandong Fangyu Lubricants has decided to delay the start-up schedule of its 600,000 tonne/year Group II base oil plant at Zibo in Shandong province to October, a company source said on Monday.

The company originally planned to bring on stream the plant in late September, the source said, without giving further details for the reason for the delay.

The actual start-up date is not finalised, the source added.

Product grades from the plant will depend on market demand, he added.

The monthly consumption of Group II base oils is estimated at 5,000-7,000 tonnes in Shandong, as there are just a few large lubricant plants, industry sources said.

Therefore, outputs from the new plant will be delivered to major consuming regions such as east and south China, the sources added.

Most traders said that the new production will intensify competition as the market of Group II base oils is already saturated.

Other major Group II base oil producers in China include China National Offshore Oil Corp (CNOOC) and Hainan handi Sunshine Petrochemical, which has a 400,000 tonne/year and a 300,000 tonne/year Group II base oil plant respectively.

Shandong Fangyu Lubricants is largely engaged in the production and processing of distillates, base oils and lubricants.

By: Vivien Ma

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