Neste and Bapco renew commercial collaboration agreement regarding Group III base oils produced at Bahrain plant
OREANDA-NEWS. A new commercial agreement defines a renewed cooperation model for calendar year 2018. It secures Neste a significant share of the output of the base oils joint venture (JV) plant for 2018, allowing Neste to continue supplying its full customer portfolio, and enabling Bapco to launch its own brand to the global market from 1 January 2018.
The commercial agreement is a clear signal that both partners have ambitions to not only cement their respective positions as players in the Group III base oils market, but to address an ever-changing industry by being flexible and agile in their relationship, ensuring both continue to thrive in any market situation.
Neste continues to hold a 45% share of the JV manufacturing plant, while Bapco and OGHC own a total of 55% shares. The JV agreements remain unchanged, and Bapco continues to be the sole operator of the plant located at the Bapco oil refinery in Bahrain.
The Bahrain plant output continues to complement the production volumes of Neste's own plant in Porvoo, Finland, and ensures continued supply of Neste's top-quality Group III base oils, branded as NEXBASE(TM), to its global customers. Altogether, Neste will bring more than 500,000 tons of top-quality base oils to the global market in 2018.
Neste has co-developed a very large suite of industry and OEM formulation approvals with all of the major additive companies. The company continues to explore new commercial opportunities to further its global reach and to introduce new high quality Group III products under its NEXBASE(TM) brand.
In addition to working on expanding its base oils portfolio with new products and new supply sources, Neste is conducting research on completely new high-quality products based on renewable raw materials. This Renewable Base Oil project combines Neste's expertise in the base oils business and its world-leading role as a developer and producer of renewable fuels. It supports Neste's strategic target of achieving at least 20% of renewable sales from outside road traffic fuels by 2020, as well as the company's base oils goal of always being at the cutting edge of new developments, while leading the industry to a higher quality and sustainable future.