Last Tuesday, Shell began construction of a $200 million lubricant blending plant in Indonesia with a groundbreaking ceremony held at the West Java site.. The Jakarta plant, Shell's first in Indonesia but its sixth in Southeast Asia, was announced last November.
The plant, to be owned 100% by Shell, is to be built on 75,000 square meters of land, about the size of ten football fields, in Marunda Center (north of Jakarta), and will supply a range of high quality lubricants for consumer, transport, industrial and marine markets in Indonesia. The facility is expected to have a capacity of 120,000 tonnes per year.
Currently there are around 200 lubricant producers across Indonesia, with production capacity of around 700,000 kiloliters a year, creating a market value of around Rp 7 trillion (US$652 million), said Industry Minister M.S. Hidayat, who witnessed the ceremony.
Shell has the second largest lubricant market share in Indonesia, after Pertamina. According to information OEM/Lube News obtained from Kline & Company consultancy last November when the announcement was made by Shell, Pertamina is the leader with an overall market share of 55%, followed by Shell, San Mateo, CA based Top One, ExxonMobil and Jakarta based Federal Oil. Pertamina is projected to sell 680,000 kiloliters of lubricant products this year, representing a 10 percent increase on last year.
In Asia, Shell also has lubricant blending plants in China, India, Malaysia, Pakistan, the Philippines, Singapore, South Korea and Vietnam. In addition, three of Shells eight global base oil manufacturing plants are in Asia: Pulau Bukom in Singapore; Kaosiung in Taiwan and Yokkaichi in Japan. In early 2012, Shell signed a conditional Joint Venture agreement with Hyundai Oil Bank to develop, construct and operate a base oil manufacturing plant at the Daesan Refinery in South Korea.
