Malaysias Petronas Dagangan Bhd. recently signed an eight-year, U.S. $14 million lubricants supply contract with Malaysian port operator Pelabuhan Tanjung Pelepas Sdn.
The state-owned energy company signed the 51 million ringgit (U.S. $14 million) deal through its domestic lubricant sales and marketing subsidiary, Lub Dagangan Sdn. The agreement involves both industrial and marine lubricant supplies.
PTP is Malaysias largest port operator, and the port in Johor is the nations largest container terminal.
This new partnership has certainly strengthened the commercial segment of our lubricants business, subsidiary CEO Zubair Abdul Razak said in a press release last week.
The inking of this agreement will further support PTPs operational growth and complement our improvement initiatives, especially in areas of efficiency, safe lubricating methods, better stock management and understanding [of] engine wear and tear from lubricant analysis, said Glen Hilton, CEO of PTP.
We can now move from the traditional client – supplier arrangement to a partnership model that goes beyond just supplying products to listening to and understanding the clients needs and making provision of value-added services and support equipment, Hilton added.
Prior to this agreement, the lubricants supplies were ad hoc in nature supplied by various global brands via open tender process, a PTP spokesman told Lube Report Asia. “[The partnership with Petronas] supports better inventory control and re-order management in PTP. Price advantages are supported by volume requirement and are competitive. Exposures to price fluctuations can also be managed better by detailing out a clear review and approval process.”
Petronas manufactures industrial lubricants such as hydraulic oil, gear oil, greases, compressor oils and others. Its marine lubricants include a cylinder and crankcase oil for diesel engines, two-stroke marine outboard engine oils, and other lubricants for four-stroke marine diesel engines approved for use by Cummins, Caterpillar, Yanmar, Mitsubishi, Hino, Isuzu, Nissan and other original equipment manufacturers.
Petronas has 11 blending facilities worldwide and lubricant research and development centers in Turin, Italy and Bangi, Malaysia. The lubricants segment is one of the four main businesses of Petronas, and its revenue was more than RM 589 million for the 2014 financial year.
PTP, located in Johor, is Malaysias largest container terminal with an annual handling capacity of 10.5 million twenty-foot equivalent units. It is a 70-30 joint venture between Malaysian utilities and infrastructure group MMC Corp. Bhd. and Netherlands-based port management company APM Terminals, respectively.