Shell and Puraglobe to launch recycled lube production

Shell has agreed a 12-year deal with base oil recycling company Puraglobe to source recycled or re-refined base oils.

Deliveries of the recycled base oils are due to start in the second quarter of this year and are expected to run until 2035. Puraglobe will primarily provide base oils for Shell's 500mn litres/yr Grasbrook Lubricants Centre in Hamburg, which is the second-largest lubricants plant in the the firm's portfolio.

Grasbrook currently produces lubricants for gasoline, diesel and electric vehicles (EVs), as well as industrial equipment, gas engines and aviation hydraulics among other things. Puraglobe operates a base oil plant at Elsteraue in Germany, which has a capacity to produce 50,000 t/yr of Group II and 120,000 t/yr of Group III base oils.

The deal with Shell coincides with growing demand for Group III base oils for premium EV and hybrid lubricants. The share of EV and hybrid vehicles in the EU has increased in recent years at the expense of conventional gasoline and diesel vehicles — EV sales in the bloc surged by 67pc on the year in 2022, according the European Automobile Manufacturers Association (ACEA).

Shell says the agreement is part of its plan to become carbon neutral by 2050. According to Puraglobe, using its recycled base oils can reduce carbon emissions by 80pc during the refining process compared with conventional product.

By Jeffrey Wang