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Lubes . ATMOSPHERIC TOWER. FUEL REFINERY PROCESS. LPG. LAN. HAN. SKO. LVGO. CRUDE OIL. HVGO. REDUCED CRUDE OIL TO LUBE REFINERY. LUBE REFINING. 75 SM. 75 SS/ SPINDLE. 150 N. R C O. 150 SS. DEWAXING UNIT. 500 SS. 500 N. NMP EXTRACTION. HYDROFINER. VACUUM TOWER. 1300 SS.
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ATMOSPHERIC TOWER FUEL REFINERY PROCESS LPG LAN HAN SKO LVGO CRUDE OIL HVGO REDUCED CRUDE OIL TO LUBE REFINERY
LUBE REFINING 75 SM 75 SS/ SPINDLE 150 N R C O 150 SS DEWAXING UNIT 500 SS 500 N NMP EXTRACTION HYDROFINER VACUUM TOWER 1300 SS 1300 N BRIGHT STOCK 150 BS PROPANE D EASPHAL-TING RPO (AROMATIC EXTRACTS) WAX BITUMEN
BASE OIL TERMINOLOGY • LUBES ARE HIGH VALUE PRODUCTS WITH BROAD VARIETY OF USES • Automotive: Engine oils, Automatic Transmission Fluids (ATF) • Industrial: Turbine oils, Hydraulic oils, Industrial Gear oils, Compressor oils, Refrigeration oils, Machine oils, Electrical oils, Drilling Fluids etc • Medicinal: Food Grade oils, White oils,.. • REFINERIES PRODUCE BASE OILS OR BASE STOCKS • Finished Products are Blends of Base stock with(out) Additives • BASE STOCKS ARE CALLED BY VARIOUS NAMES: • Neutrals (100N, 150N, 600N,...) Bright Stocks • Grades (SAE 5, 10, 30, ..; ISO 22, 32,...) • MOST COMMON LUBE NAME IS NEUTRAL • Number is the Viscosity @ 40 or 100oC • BRIGHT STOCK IS HEAVY LUBE PRODUCED FROM RESIDUE • Name Refers to Appearance and Typical Viscosity is 2,500 SSU @ 100oF • GRADE NAMES MAY REFER TO VISCOSITY OR TO TRADEMARKS
BASESTOCK PROPERTIES AND DEFINITIONS • BASE STOCK COMPOSITION DETERMINES PERFORMANCE OF FINISHED PRODUCTS • Viscosity Index or VI • Higher VI improves Volatility, Fuel Economy, and Operating Range • Saturate Content • Higher Saturates improves Oxidation Stability and Soot Handling • Wax Content • Lower Wax Improves Operating Range • Lower Wax improves Low Temperature Performance • Pour Point • Cloud Point • AMERICAN PETROLEUM INSTITUTE (API) BASESTOCK CATEGORIES API Group Sats Sulfur VI TYPICAL MFG PROCESS I <90% >0.03% 80-119 Solvent Processing II >90% <0.03% 80-119 HYDROPROCESSING III >90% <0.03% 120+ WAX ISOME, H/C, GTL IV N.A. N.A POLYALPHAOLEFINS (PAO) V ALL OTHER BASE STOCKS
KEY LUBE OIL PROPERTIES • VISCOSITY (MEASURE OF FLUIDITY) • Range from ~ 4 to 20 cSt @ 100oC for Neutrals up to 32 cSt for Bright Stock • Brookfield Measures Low Temperature Fluidity on Finished Oils @ -40oC • VISCOSITY INDEX (INVERSE MEASURE OF CHANGE OF VISCOSITY WITH • TEMPERATURE) • Ranges from ~85 to ~105 for most Base stocks, Higher for Speciality Grades • (ex: Exxsyn ~140, PAO ~150, XHVI~140+, Ultra S ~ 125) • POUR POINT (TEMPERATURE AT WHICH FLUID BECOMES NEARLY SOLID) • Typically from -9 to -24oC • Cloud Point is Temperature at Which Wax Crystals Appear • VOLATILITY (MEASURE OF OIL LOSS DUE TO EVAPORATION) • Noack Volatility Measures Actual Evaporation (Typically 20-35 wt%) • GCD Volatility Measures Front End of Boiling Curve (e.g 10% @375oC) • COLOR (APPEARANCE) AND STABILITY (MEASURE OF COLOR CHANGE IN LIGHT) • CONRADSON Carbon (MEASURE OF CARBON RESIDUE LEFT ON IGNITION) • SATURATES, AROMATICS and ASPHALTENE CONTENTS
CLASSIFICATION OF LUBRICANTS • GENERAL CATEGORIES • SPECIFIC APPLICATIONS • PHYSICAL SPECIFICATIONS • STANDARD SPECIFICATIONS • PERFORMANCE REQUIREMENTS • USERs SPECIFICATIONS • TYPE OF BASE OIL
INDIAN LUBE REFINING CAPACITY • TMTPA • HPCL, Mumbai - 330 • IOC,Haldia - 200 • CPCL, Chennai - 240 • BPC, Mumbai - 180 • TOTAL - 950
LUBE MANUFACTURING Additives CUSTOMERS Function Lubricants Lube Refinery Blending Plants Base Oils Viscosity Index Pour Point Flash Point Improved Improved No change Key Properties Oxidation Stability Special Properties
FUNCTIONS OF ENGINE OILS • PERMIT EASIER STARTING • LUBRICATE AND PREVENT WEAR • REDUCE FRICTION • PROTECT AGAINST RUST AND CORROSION • KEEP ENGINE INTERIORS CLEAN • COOL ENGINE PARTS • SEAL COMBUSTION PRODUCTS • BE NON-FOAMING • AID FUEL ECONOMY
GREASES COMPOSITION BASE OIL + THICKENER + ADDITIVES MINERAL SOAP ANTI-OXIDANT SYNTHETIC NON-SOAP ANTI-CORROSION VEGETABLE EP/ANTI-WEAR TACKINESS AGENT SOLID FILLER
WHY USE A GREASE? • A GREASE OFFERS UNIQUE CHARACTERISTICS WHICH MAKES IT PARTICULARLY USEFUL IN MACHINE ELEMENTS • STAY WHERE IT IS PUT • ALLOWS UNATTENDED SERVICE FOR LONG PERIODS (SEALED FOR LIFE) • REQUIRES LESS FREQUENT APPLICATION FOR AREAS OF POOR ACCESSIBILITY • SEALS OUT CONTAMINANTS • OPERATE OVER A WIDE TEMPERATURE RANGE • SOLID ADDITIVES CAN BE USED WITHOUT CONCERN OF SETTLING OUT • LOW LEAKAGE MEANS THEY ARE EFFECTIVE IN WARM EQUIPMENT
NLGI CLASSIFICATION OF GREASESNATIONAL LUBRICRATING GREASE INSTITUTE NLGI NO. ASTM PENETRATION @ 25OC* 1 310-340 2 265-295 3 220-250 4 175-205 5 130-260 6 85-115 * After working 60 strokes.
MAJOR INDUSTRIAL GRADES • ENKLOS • TURBINOLS • PARTHANS • SEETUL • SPINTEK • KOOLKUTS • RUSTOPS • HYTHERMS • ELASTOS • METAQUENCH
MARKET SHARE (PSUs)(2005-06) • MARKET LEADER IN GROWTH : 35.1% AGAINST INDUSTRY GROWTH OF 12.7% HPC Figures exclude base oil sales to BPC / IOC
SECTORIAL CONTRIBUTION LUBES MARKET 1250 TMTPA Growing AUTOMOTIVE 800 TMT INDUSTRIAL 450 TMT RET OUTLET 170 TMT BAZAAR 580 TMT DIRECT 500 TMT 2S 2/3W 150 TMT CAR 30 TMT 4S 2W 45 TMT D E OILS 350 TMT GEAR OIL 100 TMT OTHERS 75 TMT
CORE SECTORS • Sector Percentage • Auto OEM - 7 • Cement - 3 • Power - 4 • STU - 8 • Rubber -9 • Colliery -4 • Defence - 4 • Railways -10 • Metals - 10 • Others -41
LUBE MARKET : MARKETING CHANNELS • RETAIL OUTLETS AUTOMOTIVE OILS AND GREASES • RESELLERS/JOBBERS AUTOMOTIVE OILS AND GREASES • C&F AGENTS FOR SMALL AND MEDIUM INDUSTRIES • LUBE DISTRIBUTORS FOR BAZAAR TRADE • DIRECT SALES TO CONSUMERS
DEVELOPMENT OF NEW CHANNEL BAZAAR : LUBE DISTRIBUTORS • BAZAAR : 40% VOLUMES : CASTROL AND OTHER PLAYERS • PSUs TOO STARTED DEVP. • BAZAAR REMAINED UNCATERED • NEED FOR EXCLUSIVE LUBE DISTRIBUTOR CHANNEL • SHIFT IN BUYING HABITS OF CUSTOMERS : NEW GENERATION VEHICLES : MECHANICS ACTING AS INFLUENCERS • CHANNEL PICKED UP 25,000 KL WITHIN THREE YEARS
LUBE DISTRIBUTOR • EXCLUSIVELY CATERING TO LUBE SHOPS, GARAGES, AUTHO. SERVICE CENTRES • INFRASTRUCTURE : DELIVERY VEHICLE, STAFF, SHOWROOM / OFFICE AND GODOWN • COMPUTER • FMCG TYPE OF MARKETING : POPs, INVENTORIES, ORDER TAKING, SUPPLIES AND CREDIT / COLLECTIONS
DIRECT SALES - LUBES • OEMs, CORE SECTOR ( STEEL. COAL, POWER, CEMENT, SUGAR ETC.,), RAILWAYS, DEFENCE ETC., • MOSTLY TENDER BASED EXCEPT LOCALISED SMALL REQUIREMENTS • SALES SUPPORTED BY TECHNICAL SERVICES – CES, PES, CONDITION MONITORING, TRAILS, ENERGY AUDITS ETC., • PRICE HEDGING – SUPPORT TO CUSTOMER THROUGH FIXED PRICE : INVENORY MANAGEMENT : COST SAVINGS
LUBE NETWORK RETAIL AND DIRECT • RETAIL OUTLETS : 5,000 PLUS : DIRECTLY CATERING TO END USER / CUSTOMERS AND MECHANICS • LUBE DISTRIBUTORS : 150 PLUS : HAVING A BASE OF 80-100 BAZAAR SHOPS PER D’TOR WHO IN TURN SERVICE THE END USERS / MECHANICS • LUBE CFAs, COLD, COD AND LUBE AND OTHER DEPOTS
RETAIL LUBES MARKETING • Packaging • Lube Incentive Schemes • Advertising and Product Promotion Campaigns • Launching of new Brands • Genuine oil tie-ups • Network Development • Micro Marketing • Mechanic Contact Program
ENVIRONMENT • Long-term growth estimated at 3-4% p.a. • More than 25 players of repute in the Market • Over 500 small local blenders