Japanese lubes producer, Idemitsu, is set to continue its recovery by entering the market in Vietnam.
The organisation was severely hit financially by the 2011 tsunami in Japan and flooding in Thailand in the same year. However, profits were saved by investment in other parts of South East Asia - in particular Indonesia - foundations Idemitsu wants to strengthen.
The company's latest venture will take it into Vietnam with construction of a 60,000m² manufacturing plant which will deliver 35m litres of lubricants annually through its newly-formed production and marketing company, Idemitsu Lube Vietnam Co Ltd. With a little more than $23m of capital at its disposal, the company will produce and sell engine oil and general industrial lubricants.
At a cost of close to $10bn, the new refinery is set to come on-stream in 2014, with a 200,000b/d capacity and will be developed by a consortium which also includes Kuwait Petroleum Corp, PetroVietnam and Mitsui Chemicals. Sited in Haiphong, south of Hanoi, the operation will help Idemitsu meet proposed targets of 20,000kl of annual sales with a $35m turnover by 2015.
Demand for high-performance lubes is increasing in Vietnam, according to Idemitsu, particularly in the motorcycle sector for the country's 90m poplulation, of which 60% are under the age of 30.