JX Nippon Oil to boost base oil feedstock capacity at Mizushima refinery

JX Nippon Oil & Energy Corp. will reorganize its lubricating base oil production system in Japan, China and South Korea to better respond to the globalization of automakers. In August, parent JX Holdings Inc. announced a joint venture with South Korean oil company SK Innovation Co. The two firms are currently building a lube base oil plant capable of producing 1.35 million kiloliters a year in Ulsan, South Korea, at a cost of roughly ¥28 billion (US$359.7 million). Additionally, JX Nippon Oil plans to invest some ¥3 billion (US$38.5 million) to boost feedstock capacity at its Mizushima plant in Okayama Prefecture, by roughly 20% to 13,000 barrels per day. JX Nippon Oil plans to ship some of the feedstock from the Mizushima plant to the Korean joint venture plant. It plans to import base oils from the Ulsan plant, which will then be blended as finished lubricants in Japan, for sale domestically, as well as in China and the U.S. JX Nippon Oil produces 1.2 million kiloliters of base oils a year in Japan. In China, the company is considering boosting annual capacity at its three lube blending plants to keep up with growing demand from Japanese automakers there. JX Nippon Oil, the number one lube manufacturer in Japan, plans to boost overseas sales by 80% to 700,000 kiloliters by fiscal year 2015, from 380,000 kiloliters in 2010, to grow its business. (December 8, 2011)