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July 25, 2017

Volume 7 Issue 3

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Lukoil Forms Chinese Subsidiary

Lukoil established a lubricant subsidiary in China as part of its expansion in the Asia-Pacific region. It opened an office in the northwestern city of Urumqi and plans to open another in Shanghai.

Lukoil Lubricants China Co. will handle the growing demand for the company’s lubricants in China, a representative of the Russian energy giant’s lube division, OOO LLK-International, told Lube Report Asia.

“Supplies to China [previously] went through authorized dealers in Russia and Kazakhstan and our Kazakh subsidiary, Lukoil Lubricants Central Asia,” a company spokesman said last week. “We have already opened a representative office in Urumqi [Xinjiang Uyghur Autonomous Region]. This fall we are getting ready to open the company’s head office in Shanghai.”

Shanghai is an important transport hub and the region’s busiest port for container ships, the company said. It offers a convenient launching point to ship finished products to the central part of China and to export markets. “The eastern part of the country and the coast is the most densely populated and economically developed region in the country.”

The Xinjiang Uyghur Autonomous Region has great potential for growth as well, Lukoil said, noting that it’s located along the “One Belt, One Road” railway system that connects Western Europe with Western China.

Urumqi is near the border with Kazakhstan, where Lukoil is building a 100,000 metric tons per year lubricant blending plant to cater to the Central Asia and China markets.

Although other Russian lubricants companies such as Gazprom Neft are active in China, Lukoil is the first Russian company to establish a lubricants subsidiary in the country. LLK’s Lukoil lubricant arm is the largest lube marketer in Russia.

Earlier this year, Gazpromneft-Lubricants Ltd. opened its first “G-Energy Service” car maintenance and fast lube outlet in the country, in Shanghai.

Photo: OOO LLK-International

Lukoil Lubricants China Co. will handle the growing demand for the company’s lubricants in China.