Major increases in Group II/III output is helping to meet China's demand for higher quality lubricants
Sinopec aims to more than double its API Group II/III base oil capacity by 2015, according to Lube Report. The state-owned oil company aims to increase capacity to 1 million tons per year within three years, up from a current 410,000 metric tons per year. The group is currently building three major projects across China to help meet demand: a 240,000 t/y Group III plant in Yanshan, a 250,000 t/y Group III plant in Maoming, and an 86,000 t/y Group II plant in Jinan.
At the ICIS Asian Base Oils & Lubricants Conference in Singapore, Zhang Ye, a manager at Sinopec Lubricants Co, predicted Chinese lubricants consumption will reach 8.1 million t/y by 2015, of which 3.65 million tons will be engine oil. Zhang sees the nation's auto market, the largest in the world, as a key driver of lubricants usage.
In 2011, China's total base oil consumption reached 6.91 million tons, of which 2.75 million tons were supplied by the country's three state-owned giants: Sinopec, PetroChina and CNOOC. More than 2 million tons were imported with the remainder mopped up by smaller, lower quality refiners. Currently, total Group II/III capacity stands at around 1.31 million t/y.
Sinopec, Asia's largest refiner, is planning major expansions and upgrades across all of its base oil plants, with the exception of its new Singapore facility, as the company turns its focus towards higher quality, more environmentally friendly products.