Saudi Aramco Base Oil Company (Luberef) signs a deal with Aramco to build a base oil plant at Jazan Refinery. The agreement creates a plan for technical, commercial, and operational checks on the project. Luberef shares news of the memorandum of understanding (MoU). Aramco will supply unconverted crude oil as the main raw material. This step supports Luberef’s Group III+ Project to increase production of high-quality base oils.
Luberef’s Current Work
Luberef operates two plants in Yanbu and Jeddah on Saudi Arabia’s west coast. These spots sit on the maritime Silk Road for easy shipping. The plants produce 1.3 million metric tonnes of base oils each year. Luberef focuses only on base oils. It joins two other companies in the Aramco Base Oil Alliance. The group works together to make and sell base oils worldwide.
Jazan Refinery Role
The new plant will go inside the Jazan Refinery and Petrochemical Complex. Aramco runs this site, which handles 400,000 barrels of oil per day. It makes fuels and chemicals to serve local and global markets.
The MoU lasts 18 months. Partners will study if the plant can make up to 800,000 tonnes of Group III+ base oils yearly. Group III+ oils work well in modern engines and lubricants.
Project Goals
This deal helps Luberef expand its reach in advanced base oils. The company aims to meet rising demand for better products. Aramco’s supply ensures steady raw materials for the plant.
Studies will check costs, technology needs, and market fit. If all goes well, construction could start soon after. The project fits Saudi Arabia’s plans to grow its oil refining sector.
Why It Matters
Base oils form the base for engine oils and greases. Demand grows with more vehicles and machines. Luberef’s move strengthens Saudi Arabia’s spot as a top producer. The Jazan plant adds jobs and skills in the south. It links with Aramco’s big refinery to cut waste and boost output. Local communities gain from new work and training. Aramco and Luberef share a strong bond. Past projects show they deliver on time. This deal builds on that trust to drive growth.
Next Steps
Teams start reviews right away. They test options for plant design and size. Results guide the final decision on building. Luberef keeps focus on safety and quality. The company trains staff for new tech. Success here opens doors for more projects. This base oil plant deal shows smart teamwork. Aramco and Luberef push the Saudi industry forward. Markets watch for updates on progress.
