March 15, 2017
Volume 17 Issue 52
Hill Lays Out Plans for Kazakh Market
Kazakhstan lubricant manufacturer Hill Corp. plans to expand its lubricant blending plant in Shymkent and also to begin construction of a long-discussed base oil plant, the company confirmed last week.
Hill aims to increase capacity at its 70,000 metric tons per year lubricant blending plant in Shymkent, southern Kazakhstan, by 30,000 tons, a representative told Lube Report. The facility produces engine oils, transmission fluids and industrial lubricants under the Hill and Fastoil brands.
“Around 85 percent of this volume is expected to be shipped in the domestic market, while the rest should go in the export markets of Russia, Kyrgyzstan, Uzbekistan and China,” the representative said.
In 2016, Hill Corp. (High Industrial Lubricants and Liquids) captured 10 percent of Kazakhstan’s retail market for automotive lubricants and 60 percent of the country’s industrial oil market.
“Last year our sale volumes reached 20,000 tons, while our revenues increased to 9 billion Kazakh tenge [U.S. $28.3 million], or 18 percent more compared to 2015,” the Hill Corp. representative stated. Out of total production, the company exported 350 tons of finished lubes last year.
The company also announced it expects to start construction this year of its 250,000 t/y API Group I, Group II and Group III base oils plant. The facility will be built in Shymkent through a partnership with state energy major Kazmunaygas, and will use vacuum distillation and hydrotreating technology licensed by Chevron Lummus Global.
Hill Corp. first discussed the project in 2011 and originally intended to begin construction in 2013. Now it has targeted 2020 to open the facility.
Hill added that it plans to construct a used oil rerefinery for production of base oils, but did not disclose a timeline or additional details. “The rerefining project could reduce our production costs by 10 percent and help us expand our finished products quality by giving them higher added value,” the representative said.
Kazakhstan’s economy is based on exports of raw materials, primarily crude oil, and the country’s lube market reflects this. In 2015, Kazakhstan consumed 139,000 tons of finished lube products, and 85 percent of it, or 119,000 tons, were imports, according to the country’s government statistics. “Roughly, the difference [of about 20,000 tons] was supplied by Hill,” the representative said.