Indian Oil, ADNOC enter base oil deal

Indian Oil Corp Ltd has entered into a long-term base oil purchase agreement with Abu Dhabi National Oil Co (ADNOC) for the latter’s base oil, ADbase

April 23, 2019

ADNOC has steadily expanded cooperation with Indian energy firms that now spans across the upstream, midstream and downstream spaces

The United Arab Emirates’ state-run oil company said that India featured strong future demand for high quality base oil and finished lubricants

IndianOil said that it would use the ADbase oils to manufacture engine oils to supply to the nation’s fast-growing automotive sector

India’s total consumption for finished lubricants is estimated at around 2 million tonnes and is growing at an annual rate of 2.4 per cent

Indian Oil Corp Ltd has signed a long-term base oil purchase agreement with Abu Dhabi National Oil Co (ADNOC), as per an official announcement on April 23. Under the deal, IndianOil will buy ADNOC’s base oil, ADbase. The state-run oil company of the United Arab Emirates has steadily expanded cooperation with Indian energy firms that now spans across upstream, midstream and downstream spaces. ADNOC said that the agreement with a “major base oil consumer in a large and growing market” was critical. It added that India featured strong future demand for high quality base oil and finished lubricants.

IndianOil will use the ADbase oils to manufacture engine oils for the nation’s growing automotive sector. The state-run oil refiner is the largest seller of finished lubricants in India with volume of 450,000 tonnes per annum. India’s total consumption for finished lubricants is estimated at around 2 million tonnes and is growing at an annual rate of 2.4 per cent. Opportunities in the space have driven ADNOC to invest in the US$45 billion Ratnagiri Refinery & Petrochemicals Ltd (RRPCL) venture, the world’s largest integrated petrochemicals, refinery complex coming up in India, along with Saudi Arabian Oil Co (Saudi Aramco).

The mega refinery will be capable of processing 1.2 million barrels of crude oil per day (60 million tonnes per year). It will produce a range of refined petroleum products, including petrol and diesel meeting the latest BS-VI fuel efficiency norms. The refinery will provide feedstock for the integrated petrochemicals complex, which will have the capacity of producing about 18 million tonnes per annum of petrochemical products. The plant is designed to meet India’s fast-growing fuels and petrochemicals demand, currently the world’s third largest. Meanwhile, India is also looking to oil imports by 10 per cent by 2022.

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