BP last Wednesday announced plans to build a new lubricants blending plant in China to help meet the country’s rapidly growing demand for high quality lubricants. The new plant will be BP’s third lubricants blending plant in China and, with expected investment of around RMB1.5 billion (US$230 million), will also represent BP’s single largest blending plant investment worldwide.

“Premium lubricants are a growth business for BP and ensuring that we can meet demand in a country growing as quickly as China is essential to our success,” said BP Downstream chief executive officer Tufan Erginbilgic. “This third lubricants blending plant demonstrates our commitment to strengthening our competitiveness and building a sustainable lubricants supply chain in China.”

The new plant will serve as a strategic production hub for BP and Castrol’s lubricants business in China and complement the two lubricants blending plants already operating in China.

“China is a key growth market for premium lubricants,” Xiaoping Yang, BP China president, remarked. “The new plant not only marks another milestone in BP’s business development in the country but also reaffirms our commitment to long-term investment in and for China.”

The new plant, expected to start operation before the end of 2021, will have an annual production capacity of 200,000 tons. With an area of over 150,000 square meters, it will be able to produce premium lubricants and greases for automobiles, industrial, marine, and aviation customers, as well as special lubricants and additives, with a particular focus on synthetic products which offer superior engine protection and performance compared to conventional oils.

Located in the Tianjin Economic-Technological Development Area (TEDA), in Binhai New Area, Tianjin, the blending plant will supply premium lubricant products to customers in north China. Tianjin is the largest coastal open city in north China and one of four municipalities directly under the Chinese Central Government.

“Strategically located in TEDA, this new plant will leverage Tianjin’s competitive advantage as transportation hub, helping us ensure a stable supply of raw materials and smooth distribution of products,” said William Sun, Supply Chain Director, China and North Asia, BP Lubricants.

To supply high quality lubricants to the fast-growing Chinese market, BP-Castrol set up its first lubricants blending plant in Shenzhen, Guangdong province in 1998 and the second in Taicang, Jiangsu province in 2005.

Castrol commenced its China operation in 1989 and is now a key player in China’s premium lubricant market. In addition to the two operating plants in Shenzhen and Taicang, Castrol opened its first China Technology Centre in Shanghai Pudong in 2010.