Total unveils its largest lubricant plant in S'pore

Singapore

TOTAL Oil Asia-Pacific on Friday launched its largest lubricant plant in Singapore, in a bid to double lubricant sales in Asia.

Located at the Singapore Lube Park at Tuas South, the French oil major's new two-storey facility employs 104 workers, and has an annual production capacity of 310,000 tonnes of lubricants for automobile, industrial and marine applications, mainly for the Asean market.

Total expects to shift all local lubricant production in Singapore from its Pandan and Pioneer lubricant plants to its new facility. Fully operational by year-end, the Tuas facility will double Total's lubricants production in Singapore and increase its regional capacity by 30 per cent.

The oil giant last year supplied about two of the 40 million tonnes of lubricants that were traded globally. It is the market's fifth largest player, with 45 lubricant production plants and six logistic hubs, and a marine network of nearly 1,000 ports globally.

In the Asia-Pacific, Total is the ninth largest player. The region presently accounts for about a third of Total's overall lubricant sales. By 2025, the company expects the Asia-Pacific's contribution to grow to 40 per cent.

Along with being the largest lubricants market, the Asia-Pacific is also expected to be the fastest growing lubricants market, at an estimated compound annual growth rate of 3.49 per cent from 2014 to 2020, a study by Grand View Research Inc shows.

Total Oil Asia-Pacific's president of marketing and strategy and new energies, Philippe Boisseau, said at Friday's opening ceremony: "With a population of more than four billion, Asia is for Total a key region of future energy demand growth. The lubricants market is expected to reach 20 million tonnes by 2025."

At the sidelines of Friday's event, Mr Boisseau told reporters that the company expects global lubricant demand to grow about 0.6 per cent in the next decade, less than the 2 per cent it had anticipated two to three years ago.

"China is today the biggest lubricants market in the world, and it is a new player. Growth has been impressive last year. Now, it is slowing down," Mr Boisseau said. But he is confident that Total can outpace the market's growth in China, given its industry expertise and the country's vast geography.

Singapore, which is also the strategic hub for Total in Asia, was chosen to house its new facility due to the Republic's strategic position, business-friendly policies, and logistic infrastructure which allows the oil giant to drive its regional growth, Mr Boisseau said.

Tan Pai Kok, Total Oil Asia-Pacific's vice president of lubricants, marketing and services Asia-Pacific, told reporters that majority of the Tuas facility's feedstock, which includes base oils and additives, are locally sourced.

At Friday's ceremony, Deputy Prime Minister and Minister for Home Affairs, Teo Chee Hean, said that the lubricants industry strengthens integration across the refining sector.

"Our refineries produce the base oil that goes into the production of lubricants ... Total's growing presence in Singapore thus strengthens and adds value across the entire energy and chemicals value chain."

The energy and chemicals industry today accounts for a third of Singapore's manufacturing output, employs some 26,000 people, and is one of the highest-paying manufacturing sectors, Mr Teo said.

He added that Total's new facility aligns with Singapore's efforts to improve productivity.

In the past, five workers were required to operate a filling line that produces 160 drums per hour. Today, automated filling lines at the new facility only require two workers to produce 250 drums per hour.