LUKOIL ENG OILS FOR 2020 1 - ccpresentations.com · LUKOIL NAVIGO MCL Extra is such a rebalanced 40...

LUKOIL ENG OILS FOR 2020 1

MARINE ENGINE OILS POST - 2020

042019

Sanjiv Wazir

LUKOIL Marine Lubricants

➢Introduction to LUKOIL Marine

➢Future fuels

➢Engine Lubrication post-2020

OVERVIEW

LUKOIL GROUP

Key Projects

Oil Production

Exploration Oil Refining

Gas Processing

PetrochemicalsPower

Generation

Transport

Lubricants & Fuels

Marketing

27 years of accelerated growth


of global

oil reserves

1%

Major Russian vertically

integrated Oil company

27years young

of global

oil production

2%

* LUKOIL fact book 2014 - 2017

LUKOIL GROUP

▪ Largest Privately Owned Oil Company in Russia

▪ Listed on London, Frankfurt, Moscow and New York Stock Exchanges

▪ Head Quartered in MOSCOW, RUSSIA

▪ 104,000 + Employees (2017)

▪ 8 Refineries, 33 Manufacturing facilities worldwide

▪ 5500 + Fuel Stations in 23 countries

5

http://www.lukoil.com/materials/doc/AGSM_2015/LUKOIL_OF_eng_2014.pdf

LLK- Marine Lubricants

LLK-Naftan 2007

LLK-INTESMO

LUKOIL Lubricants East Europe

LUKOIL Lubricants Middle EastLUKOIL Lubricants Central Asia

LLK-Naftan▪ Additive production 40,000

MT/year capacity

▪ More than 40 different

additives and packages

LLK-International

▪ 100% owned by LUKOIL Group and responsible for

the lubricant business globally offering world class

products and services to Automotive, Marine and

Industrial segments

▪ LLK-International is among the TOP 10 global

lubricant producers worldwide

2008

20072010

20051991

2011 2008

2007

LUKOIL Lubricants CHINA 2017

LLK-Marine Lubricants▪ LLK-Marine Lubricants

operate globally and enjoys

12% Global market share

as of 2016 and growing

▪ Supply position in more

than 925 ports in over 74

countries worldwide

LLK-INTESMO

▪ JV with Russian Railways

Greases production

▪ 30,000 MT/year capacity

▪ More than 40 different

greases

LLK-International 2005LUKOIL Group 1991

LUKOIL GROUP –RAPID GROWTH

6

LUKOIL MARINE – A GLOBAL PLAYER

countries worldwidedistribution network

63 5Continents

acrossthe globe

900 + PORTS COVERAGE

GLOBALLY

OVER 15% GLOBAL MARKET

SHARE

LUKOILNAVIGO WORLDWIDE

OVER OVER 500 CUSTOMERS

OVER 7000 VESSELS


STRONG & SUSTAINED FOCUS ON R & D

➢Successful and timely response to new Challenges from marine market

(Navigo 100 MCL in 2012)

➢Innovative solutions (iCOlube in 2013)

➢full range of EAL products (2014)

➢Improved ME System Oil (2015)

➢ Cyloil for ULSFO (2015)

➢Ready for 20208

LUKOIL INNOVATIONS

LUKOIL ENG OILS FOR 2020

OVERVIEW OF MARINE FUELS POST-2020

9

FUTURE FUELS

➢IMO projected fuel usage

➢Possible compliant fuels

➢Advantages & concerns regarding different fuels

10

IMO PROJECTED FUEL USE POST 2020 S CAP

Sulphur content BASE CASE VOL TYPE

<0.10% 39 mMt 12% Compliant (ECA)

0.10% - 0.50% 233 mMt 72% Compliant (ROW)

>0.5% 36 mMt 11% With Scrubber

LNG 12 mMt 4% Compliant (ECA & ROW)

320 mMt

MARINE FUELS POST 2020

1. HFO - sulphur content > 0.50%.(with Scrubber)

2. ULSFO - sulphur content < 0.10%

3. VLSFO – sulphur content < 0.50%

4. LNG

5. LPG

6. Methanol

7. Biofuels

8. Hydrogen/Fuel Cells

9. Batteries

10. Wind assisted propulsion

12

HFO

ULSFO

VLSFO

LNG

LPG

METHANOL

BIO-FUELS

H2/FUEL CELLS

BATTERIES

WINDS

Fuel ▪S>0.5%. Residual product from refining of crude oil

▪Price currently lowest. Expected to remain competitive▪Used as benchmark to judge economics of alternates

Advantages ▪ Currently most widely used marine fuel▪ Industry is well experienced in its use

Concerns ▪EGCS (Scrubber) required. Capex USD 2-5 Mil/vsl▪EGCS option may not be viable for many vessels due to space, age & cost concerns▪Restrictions on EGCS usage in some areas*▪Continuous monitoring of SOx,CO2 and Wash water quality▪1-2% of engine power required for operating EGCS▪Additional OPEX for running/maintaining EGCS▪Will meet NOx requirements with engine modification

Availability& logistics

▪At present worldwide,▪After 2020 at least in all major bunkering ports

Lubrication ▪2S: SAE 50,BN 70/100/140; NAVIGO 70/100/140 MCL▪ No impact on System oil▪4S: SAE 30/40, BN 30-55 as currently used

13

HFO

*REGIONAL RESTRICTIONS ON SCRUBBER USE

14

HFO

ULSFO

VLSFO

LNG

LPG

METHANOL

BIO-FUELS

H2/FUEL CELLS

BATTERIES

WIND

Fuel ▪S <0.1%. Derived mainly from the general distillate production

▪Present Price HFO + 40-80%

Advantages ▪Compliant with ECA & ROW Sulphur limits.▪No additional Capex required▪In use since 2015, no major operational issues expected

Concerns ▪Higher Cost.▪Bunker suppliers may supply automotive diesel quality whichtypically only contains 0.001% S, and has Low FP.▪Low Viscosity (poor lubrication of fuel system components, leaks).▪Low Sulphur (potential scuffing due to excess LO additive, bore polishing due to closed surface).* *▪Will meet NOx limits with engine design changes


▪No availability or logistics challenges are perceived

Lubrication ▪2S: 15-25 BN cyloils; NAVIGO MCL ULTRA▪No impact on System oil▪4S: 15-30 BN TPEO

15

ULSFO

HFO

ULSFO

VLSFO

LNG

LPG

METHANOL

BIO-FUELS

H2/FUEL CELLS

BATTERIES

WIND

Fuel ▪S<0.5%. Derived from Sweet crude (0.3-0.8% S) or Distillate/HFO blends*▪Unlikely that refiners will invest to de-sulphurize HFO in the short term.*▪Price unknown; Predictions HFO+ 20-50 % at least initially

Advantages ▪Compliant with Sulphur cap in ROW▪No additional capex required

Concerns ▪No track record of using such fuels**▪Stability , Compatibility, wax – sediments (centrifuging & filtration issues)**▪Some sources of Sweet Crude have high AN▪CCAI: due to larger difference between viscosity and density. ▪Pour Point: Paraffinic vs Cracked blend components. ULSFO/VLSFOs close to limits **▪Potentially higher level of Cat-Fines▪Impact on engine design ▪Will meet NOx limits with engine design changes


▪There may be localised availability constraints in initial days***▪No logistics challenges

Lubrication ▪2S: 15-40 BN. NAVIGO MCL Extra (Balanced cyl oil);▪No impact on System oil▪4S: 20-40 BN TPEO

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VLSFO

*BLENDED VLSFO

➢ Some refiners will produce 0.50% sulphur fuel oil, but not enough

➢ Conversion units for producing more distillates equates to 1 billion dollars per refinery and an average time-frame of 5 years

➢ Extremely energy intensive process, so enviro benefits of de-sulphurisation may not be clear-cut

➢ Most markets are expected to take the blending route

➢ Blending Considerations:

– Aromatics:

– Improve stability

– Negative impact on ignition properties

– Paraffins:

– May disturb stability

– Improves ignition properties

– Expensive product

• GOAL: Balance between Paraffins and Aromatics 17

CONCERNS REGARDING COMPLIANT FUELS

18

➢ Stability

➢ Compatibility

➢ Ignition & combustion properties

➢ Cat-fines

➢ Low KV

➢ AN

➢ Cold flow properties

➢ Unusual fuel components

COMPLIANT & DISTILLATE FUEL STABILITY

19

➢ Bulk fuels stored for a long time can become unstable – the asphaltene content can precipitate out of the fuel mix causing formation of sludge

➢ The potential to break down depends upon the HC mix of the mix. Higher the aromatic content more stable the fuel mix. Higher the parafinnic content more unstable is the fuel mix

➢ Once asphaltenes separate out, the process cannot be reversed

➢ Total Sediment Existing/Total Sediment Potential/Total Sediment Accelerated tests are used to determine the stability of fuels

COMPLIANT & DISTILLATE FUEL COMPATIBILITY

20

➢ The tendency of fuels to produce deposits when mixed.

➢ Even a mixture of two stable fuels can become unstable.

➢ Some precautions ➢ Avoid mixing bunkers from different sources

➢ Don’t mix Straight-run fuel with “cracked” fuel

➢ Don’t mix with dissimilar densities and viscosities

➢ Don’t mix a RFO with MDO or MGO

➢ Compatibility is test by ASTM D 4670


VLSFO OEM ( MAN) FUEL CONCERNS

022

OEM CONCERNS ABOUT CYLOIL FOR COMPLIANT FUELS


➢The 40 BN lubricants which are available in the market do not seem to provide sufficient detergency to handle ULSFO and all VLSFO fuels as one single cylinder

oil.

➢This would create the need to have both, 20 and 40 BN cylinder oils

➢Or there is a need for a rebalanced cylinder oil to cover the future needs.

023

➢ LUKOIL NAVIGO MCL Extra is such a rebalanced 40 BN product

➢ Launched in May 2017, NAVIGO MCL Extra in May 2017, a 40 BN marine cylinder oil for distillate, ULSFO (≤ 0.1%S) and VLSFO heavy fuel oil ( ≤0.5%S) applications.

NAVIGO MCL EXTRA


NAVIGO MCL Extra shows excellent piston cleanliness on M.V. E.R. TALINN at end of trial inspection

024LUKOIL ENG OILS FOR 2020

INTRODUCED IN 2017

025

NAVIGO MCL EXTRAOEM APPROVALS


026

NAVIGO MCL EXTRACOMPETITOR ANNOUNCEMENTS


LNG

HFO

ULSFO

VLSFO

LNG

LPG

METHANOL

BIO-FUELS

H2/FUEL CELLS

BATTERIES

WIND

Fuel ▪Main component is methane (CH4), the hydrocarbon fuel with the lowest carbon content▪Delivered price currently higher than HFO, but expected to become competitive with VLSFO

Advantages ▪Highest potential to reduce CO2 (reduction 26% wrt HFO)▪No SOx emissions & reduction in PM***▪Upto 30% reduction in NOx▪Engine technology available & many engines already in service▪Higher Calorific value, less fuel consumption wrt HFO▪Clean burning, less Engine maintenance

Concerns ▪Must be stored in insulated tanks*▪Vol. density is about 45% of HFO, hence 2-3 x Storage cap reqd*▪Additional Capex 10-30% of ship value*▪Addl power reqd to run LNG systems.▪High Methane Slip* * ▪Higher Ultrafine particle emission***

Availability&Logistics

▪No limitations on production capacities▪Bunkering facilities are improving rapidly, experience for safe LNG bunkering is growing

Lubrication ▪2S: SAE 50, Low BN; NAVIGO MCL ULTRA▪No impact on System oil▪4S: Low BN, SAE 40 gas eng oils. eg LUKOIL Efforse 4004 27

*LNG STORAGE & USE

28

CYLOILSPOST 2020

29


MANMin KV 18.5cSt at 100°C

CURRENT OEM RECCOMENDATIONS FOR 2-S ENG CYLINDER OIL

WINGDMin KV 18.5cSt at 100°C

LUKOIL 100 BN CYL LUBE & iCOLube 32

iCOlube PRINCIPLE

UTILISINGHigh BN Cylinder oil withFresh System oil, orUsed System oil, or Low BN Cylinder oil

to OPTIMIZE cylinder lubricationwith the right BN Cylinder oil inline with the Sulphur content of the fuel in use


iCOlube® UNIT

5.0 %S

3.5

2.5

1.7

1.0

0.5

0.1

0 BN

NAVIGO NAVIGO NAVIGO NAVIGO NAVIGO

MCL Ultra MCL Extra 70 MCL AW 100 MCL 140 MCL

BN20 BN40 BN70 BN100 BN140

SAE50 SAE50 SAE50 SAE50 SAE60

▪ Current Cylinder Oil Application by- %S- Fuel kinds- Engine designs- Operating condition- etc.

▪ Cylinder Oil Application for

2020 and Beyond

MCL Application

CURRENT 2 Stroke Engines - MCLs

ECA <0.1%S • Gas Fuel• ULS FO• LS FO

Out of ECA >0.1%S • %S in use• Engine corrosive Level

▪ Cylinder Oil Application with iCOlube for 2020 and Beyond

5.0 %S

High

3.5 Corrosiv

High Engine

2.5 Corrosiv

1.7

1.0

0.5

<0.5%S

0.1

<0.1%S

0 BN



BN20 BN40 BN70 BN100 BN140

SAE50 SAE50 SAE50 SAE50 SAE60

Lo

w C

orr

osiv

e E

ng

ine

MCL Application


2020 and Beyond

Without Scrubber With Scrubber• %S in use• Engine corrosive Level


▪ Cylinder Oil Application with iCOlube for 2020 and Beyond

POST SULPHUR CAP 2020 2 Stroke Engines - MCLs

5.0 %S

3.5

2.5

1.7

1.0

0.5

0.1

0 BN



BN20 BN25 - BN20 - BN20 - BN20 -

BN40 BN70 BN100 BN140

MCL Application



2020 and Beyond

▪ Cylinder Oil Application with iCOlube for

2020 and Beyond

Without Scrubber

With Scrubber

POST SULPHUR CAP 2020 2 Stroke Engines - MCLs

LUKOIL TPEO products cover all Sulphur range

However,

The right BN, Viscosity grade shall be applied

practically Based on

OEM Requirement&

actual operating condition

TPEO Application

POSTSULPHUR CAP 2020 4 STROKE ENGINES - TPEOs

CONSIDERATIONS WHEN CHANGING TO COMPLIANT FUELS

➢ Towards 2H2019 avoid maintaining high ROB of High BN cyloils & TPEO

➢ Draw down High BN oils ROB in line with draw down of HSHFO

➢ While Low & High BN Cyloils (& TPEOs) are compatible & miscible, getting a homogenous mixture is key but not easy. May require some mechanical agitation/recirculation

➢ Slow Steaming may become more common for vessels burning ‘higher cost’ compliant fuels

➢ Cooling water outlet set point on engine outlet may need review. This may affect other components in the cooling water system, such as the fresh water generator

SULPHUR CAP 2020 CONCLUSION

Summary

Our Recommendation

➢ iCOlube has performed excellently since 2013. It provides simple and wide range cylinder lubrication for 2020 and beyond.

➢ LUKOIL MCL and TPEO portfolio will cover all fuel kinds and Sulphur range.➢ Still uncertainties on 2020 – Fuel Quality, Availability, costs……

➢ Close cooperation with our customers in order to find optimal MCL/TPEO application for each engine.

POST 2020 OTHER SOURCES OF MARINE FUELS/PROPULSION

5. LPG

6. Methanol

7. Biofuels

8. Hydrogen/Fuel Cells

9. Batteries

10. Wind assisted propulsion

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LUKOIL ENG OILS FOR 2020 1 - ccpresentations.com · LUKOIL NAVIGO MCL Extra is such a rebalanced 40...

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