Rerefining Blossoms with Crude at $140

Evergreen Oil plans to build a new base oil rerefining plant with 800 barrels per day of API Group II capacity in southern Californias Imperial Valley, a company official told Lube Report. Evergreen is also in the final stages of an expansion project at itsrerefinery in Newark, Calif.,adding 550 barrels per day ofnew Group II capacity to its existing Group I production.

The Imperial Valley is a key strategic location between our Southern California and southwestern U.S. markets, Gary Colbert, Evergreens recently appointed president and chief operating officer, said on Friday. With the increasing demand for more affordable environmental lubricating oils, the new southern California facility will allow us to better service all our customers with product availability and logistics.

The company said it will announce additional details of the new facility at a later date, as it continues working on site selection and the plants basic engineering design with affiliate Chemical Engineering Partners. The new facility will use the same technology as its Newark facility, which uses hydrotreating to produce base oil from used engine oil.

The existing Newark plant has 800 b/d of API Group I capacity. The Newark facility expansion is currently on-going, and includes the construction of an entire new process train, Colbert said. It will be located on the same property in Newark, but will be operated independently of the current unit.

Colbert said Evergreen Oil will have the flexibility to operate both as parallel units, offsetting the scheduled maintenance, allowing the company to consistently provide its customers with base oil.

The plant is expected to be completed and on-line sometime first quarter of 2009, he said of the Newark expansion. It will be a Group II base oil plant with a daily product capacity of 550 barrels per day.

Other North American rerefiners include Safety-Kleen, which operates a 3,500 b/d Group I rerefinery in East Chicago, Ind., and a 1,500 b/d Group I rerefinery in Breslau, Ont., Canada; and Newalta Corp., which has a 500 b/d Group I plant in North Vancouver, B.C. Heartland Petroleum LLC expects to open a new rerefinery in August in Columbus, Ohio, with 1,500 b/d Group II capacity.