HD Hyundai Oilbank, Shell to shore up lube base oil business

HD Hyundai Shell Base Oil's lube base oil plant in Seosan, South Chungcheong Province (HD Hyundai Oilbank)

HD Hyundai said Friday that its joint venture with Shell will enter the high-performance, high-added-value lube base oil market, bolstering its lineup of premium products.

HD Hyundai Shell Base Oil, a 60:40 joint venture between HD Hyundai Oilbank and Shell, will invest in expanding its Daesan plant in Seosan, South Chungcheong Province, with a goal to begin full-scale commercial production of Group III LBO in 2027.

Lube base oil, or LBO, is the primary component for various types of lubricants such as engine oil and industrial lubricants. It is categorized into three groups based on manufacturing processes and quality traits. Due to its high viscosity index, low amount of sulfur, great oxidation stability, Group III lube base oil is considered an eco-friendly, high-performance product and is seeing a growth in its global demand.

The Group III LBO produced by HD Hyundai Shell Base Oil will be supplied to a fast-growing lubricant market of high-performance cars, electric vehicles and immersion cooling systems used at data centers.

HD Hyundai Shell Base Oil opened its plant in 2014 and started producing Group II LBO. It has continued to expand its global presence to Asia, Europe and North America and now supplies products to 50 countries.

“Based on the experiences that have satisfied the quality demands from various clients, we have decided to add another premium product lineup,” said an official at HD Hyundai Shell Base Oil. “Through technological cooperation with Shell, we will do our best to begin commercial operation according to the scheduled plan.”