Shell opens state-of-the-art lubricants blending plant in China

World’s No. 1 lubricants supplier also announces addition of technology facility at site

Shell Lubricants today announced the start-up of its newest lubricants complex in Asia to meet growing demand in China. With a production capacity of 200 million litres a year, and the potential for a phased development to 400 million litres a year, the complex could become one of Shell’s top three lubricants blending plants worldwide in volume terms.

Located in Zhuhai, Guangdong Province, the blending plant will be Shell’s sixth in China and will produce consumer, transport, industrial and marine lubricants, targeted at the Chinese market.

In a further development, Shell also announced new investment in a technical facility at the complex. This will offer a range of technical services including a quality control laboratory to provide key customers and original equipment manufacturers (OEMs) in the automotive industry with technical research, marketing and training services related to their lubricants applications.

David Pirret, Executive Vice President for Shell Lubricants, said: “The investment in a lubricants blending plant in Zhuhai is part of Shell’s strategy of selective Downstream growth and allows us to support demand from local and international customers based in China, which is the world’s fastest growing lubricants market. Once the technical facility at Zhuhai is completed, our customers in China will have the opportunity to experience at first hand our leading lubricants technology capability.”

Lim Haw-Kuang, Executive Chairman of Shell Companies in China, said: “This is another milestone in Shell’s business development in China and the latest evidence of our commitment to China and Guangdong. We will continue to look for key growth opportunities to contribute to China’s fast growing economy by providing high quality energy products and solutions.”

For the third consecutive year, Shell has been named the number one global lubricants supplier - selling more lubricants in 2008 than any other company in the world, with a 13% share of the market in volume terms (Source: Kline & Company). This is testament to a consistent strategy, strong brands and technology leadership, focusing on delivering first-class lubricants solutions to customers, wherever they may be.

Shell is already the largest international lubricants supplier in Asia by sales volume and the number one international supplier of lubricants in terms of market share in China. (Source: Kline & Company)

Shell Lubricants
The term ‘Shell Lubricants’ collectively refers to Shell Group companies engaged in the lubricants business. They manufacture and blend products for use in a range of applications from consumer motoring to mining and power generation to commercial transport. Shell’s portfolio of lubricant brands includes Pennzoil®, Quaker State®, Shell Rotella T, Shell Helix, Shell Rimula, Shell Tellus, Monarch, a portfolio of car care products and Jiffy Lube®. Shell have leading lubricants research centres around the world: in Germany, Japan, UK, and the US, plus a new presence in India

Demand for lubricants in China is forecast to grow by around 3.5% year on year to 2013, making it the fastest growing market in the world ahead of India, with the industrial lubricants sector expected to show the strongest growth in China. Already, demand for lubricants in China was estimated at 5.5 million tonnes last year, making it the second largest lubricants market in the world behind the U.S.

Shell is the largest lubricants supplier from among the international oil companies present in China with a 10% market share. China is Shell’s second largest market after the United States of America. Shell currently supplies lubricants to eight out of the top 10 car manufacturers in China as well as 47 of the top 50 steel companies. China is the biggest market for Shell Helix Motor oil.

Shell in China and Guangdong
Shell aspires to be the leading international energy company in China by developing a significant presence in the country in partnership with Chinese companies and stakeholders. Shell has more than 30 joint ventures and wholly owned affiliates with an accumulated investment of $4 billion. All Shell core businesses are operating in China including oil and gas exploration and production, petrochemicals, lubricants, bitumen, retail gas stations, clean coal as well as global solutions in technology for energy efficiency and productivity.

Guangdong has been an important market for Shell Companies in China where it has made the largest single investment in the $4.1 billion Nanhai petrochemical plant in Huizhou in partnership with CNOOC. It is also a very important market for Shell’s lubricants and fuel retail businesses. Shell is a party in the consortium supplying LNG from overseas to Shenzhen.