137 / 160
used oil, meaning it would have to be re-refined. In Brazil,
legislation requires that all used oil is re-refined. These
regulations strive to protect the environment as well as the
resource itself. More importantly, they improve the
economics of re-refining. Lower used oil prices are critical
for re-refining economics due to low base oil prices.
Figure 5 shows the estimated price of Group I, II, and III
base oil in the US. The price of base oil has been affected
by the price of crude oil, which has been low in recent
years. As seen in Figure 5, the price for Group I and Group II
are very close. This is due to the decrease in supply of
Group I base oil and the increase in the supply of Group II
base oil. This also shows the extra margin for Group III base
oil over Groups I and II.
The low Group I and II base oil prices have created tight
profit margins for used oil re-refiners. Therefore, it is
important for countries to establish and regulate used oil
collection networks, preventing its improper disposal. This
will help used oil prices adjust to the changing market of
base oil prices, improving the economics of re-refining and
conserving this valuable resource.
Low Group I and II base oil prices has motivated
re-refiners to look into ways to produce Group III base oil.
From Figure 5, it is clear that Group III is more valuable than
either Group I or II. As more vehicles use higher quality
lubricants, the collected used oil will improve in quality.
This enables Group II hydrotreating facilities to, potentially,
produce Group III products in the future. In the US and
Europe, this phenomenon has been observed by some of
CEP’s clients producing Group II+ base oil, and hopefully
soon to produce Group III. One alternative is to upgrade
equipment to allow the use of different types of catalysts
and operating conditions, which may help produce
Group III base oils by increasing the viscosity index (VI). CEP
currently has one client in the permitting phase of building
a plant that produces Group III base oil.
Conclusion
Base oil is a valuable resource that must be preserved and
reused, and re-refining used oil is the most environmentally
friendly solution. Therefore, used oil must not be
improperly disposed or burned. Instead, used oil needs to
be collected and re-refined to properly utilise this valuable
resource.
References
1. GEYER, R., KUCZENSKI, B., HENDERSON, A. and ZINK, T., ‘Life Cycle
Assessment of Used Oil Management in California’, California
Department of Resources Recycling and Recovery, California,
(2013), p. 32.
2. GRAZIANO, D. J. and DANIELS, E. J., ‘Assessment of Opportunities to
Increase the Recovery and Recycling Rates of Waste Oils’, Argonne
National Laboratory, (1995), p. 56.
3. FEHRENBACH, H., ‘Ecological and energetic assessment of
re-refining used oils to base oils: Substitution of primarily
produced base oils including semi-synthetic and synthetic
compounds’, Groupement Européen de I’Industrie de la
Régénération (GEIR), (2005), p. 42.
4. STREFF, M. and THAKKAR, V., ‘Base Oils – The Road Ahead’,
ExxonMobile Research and Engineering Company, International
Lubes Wax Conference, (2013).
5. ‘US Base Oil Price Report’, Lube Report,
Lubes‘n’Greases Magazine
,
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