Neste, Bapco To Build Base Oil Plant In Bahrain
Monday, June 16, 2008
Finland's Neste Oil Corp., Bahrain's Oil & Gas Holding Co. (OGHC) and the Bahrain Petroleum Co. (Bapco) have decided to establish a joint venture known as the Bahrain Base Oil Company to build a high-quality lubricant base oils plant in Bahrain. The plant will have an annual capacity of 400,000 tons of VHVI (Very High Viscosity Index) base oil for use in blending top-tier lubricants. It will be one of the world's largest VHVI base oil plants when it begins production, which is scheduled for the end of 2011.
Total investment cost of the project is estimated to be between 250 and 300 million euro, of which Neste Oil's share is 45%, same as the company's ownership in the joint venture. Both Bahrain's Oil and Gas Holding Co. and Bapco own 27.5% of the joint venture. OGHC is owned by the Government of Bahrain and owns 100% of Bapco.
Feedstock for the new base oil facility will be provided by the hydrocracker unit commissioned in 2007 at Bapco's Bahrain oil refinery. Neste Oil will be responsible for the sales and marketing of the output of the joint venture plant. Bapco will also provide the Operations, Maintenance and Management services to the Joint Venture.
This project underlines Neste Oil's and Bapco's commitment to new-generation, high value-added base oils," said Kimmo Rahkamo, Executive Vice President, Specialty Products at Neste Oil. "Demand for these sulfur-free base oils is increasing globally, thanks to their ability to meet current and future performance requirements, as well as more stringent environmental standards. I strongly believe that this project will prove a success for both parties."
Neste Oil is one of the world's leading producers and marketers of VHVI base oils, which are marketed under the NEXBASE brand. The new joint venture with Bapco will further extend the global reach of the company's business in this field. Bapco is renowned for its long and successful experience in the fields of oil and gas exploration, production, refining and marketing and for their Operational Excellence in safety and reliability.
Source: Neste Oil Corp.
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