JX Nippon Oil & Energy Corp. began commercial operations last month at its new lubricant factory in Haiphong, Vietnam. The Japanese energy giant is banking on the U.S. $10.1 million facility to help it gain a large chunk of the local market.
The company aims to have 10 percent of the Vietnamese market, a spokesman told Lube Report Asia last week.
JX Nippon Oil & Energy declined to disclose the current capacity but said the facility will reach full capacity of approximately 40 million liters per year in 2020. The company did reveal that the plant employs 87 people and has filling equipment capable of filling 9,000 bottles per hour.
JX Nippon Oil & Energy said the factory will supply lubricants to motorcycle and automobile manufacturers and also make automotive and industrial lubes to be marketed in Vietnam under its Eneos brand.
Vietnam has been the worlds fourth largest motorcycle market, recording about 3.5 million motorcycle sales in 2012. The company also cited forecasts that Vietnams economy will grow at annual rates of around 5 percent in coming years.
Commenting on anti-Chinese riots in May that affected some Japanese plants, JX Nippon Oil & Energy President Isshiki Seiichi said, The riots have subsided and we will not change our investment stance in Vietnam.
In January, JX Nippon Oil & Energys competitor, Idemitsu Kosan Co. Ltd., opened a lubricant plant in the same industrial park with capacity of 35 million l/y. With lubricant demand stagnant at home, Japanese suppliers are trying to grow elsewhere. JX Nippon Oil & Energy had overseas lube sales of 500 million liters in 2013 and set targets of 710 million liters in 2015 and 900 million liters in 2020.