By George Gill
 
Saudi Arabia’s Petromin Corp. has announced a new 100 million riyals (U.S. $26.7 million), 250,000 metric tons per year capacity blending plant, which is expected to go on stream in the second quarter of 2010.
 
“Consolidation of production facilities and modernization” is the main reason for building the plant on 55,000 square meters of land at the Saudi Aramco Industrial Zone in Jeddah, said Sajid Saeed, Petromin executive vice president. In 1970 Petromin built a blending plant in Jeddah, eventually expanding it to 150,000 mt/y capacity. The company shut down and relocated that older plant a few years ago, according to Saeed.
 
“We are now consolidating all production nationwide to a new facility at the same location of the old plant,” Saeed told Lube Report. “Key target markets are the Gulf and Middle East/Africa regions. The [new] plant will produce oils and greases for all sectors of the market and not just the industrial sector.”
 
Petromin’s business revenues are split approximately 60 percent from the industrial sector and 40 percent from the automotive sector, with passenger car motor oil dominating the latter. In the industrial segment, Petromin mainly supplies the construction, transport, power plant and oil segments, according to an article in the November/December issue of Lubes’n’Greases Europe-Middle East-Africa. Petromin’s major competitors within the Saudi Arabian market include Fuchs, Shell and Castrol.
 
Saeed confirmed Saudi Arabian news reports that the new plant along with an automated mixing and packaging system at the new factory will boost the company’s productivity and push its grease production to 25,000 mt/y.
 
Petromin is owned by Advance Petroleum Services Ltd., a joint venture between National Scientific Services Limited, a member of Dabbagh Group of Saudi Arabia, and Gulf Oil International Group, which is part of the Indian conglomerate Hinduja Group.
 
Hinduja is a trading, banking and energy conglomerate headquartered in Chennai, India. Gulf Oil International is an offshore company headquartered in the Cayman Islands. Dabbagh is based in Jeddah, Saudi Arabia, and has interests in industrial and agricultural businesses.
 
Petromin was formed in 1968 as a joint venture between national oil company Saudi Aramco and Mobil Investments, now part of U.S.-based ExxonMobil. The partners sold the company in late 2007 to the current owners.