Shell to double capacity in Indonesian lubricant plant to meet growing domestic demand

Shell Indonesia announced its investment to double the production capacity of its lubricants oil blending plant (LOBP) located in Marunda Centre, near Jakarta, Indonesia. Upon completion, the plant will be capable of producing up to 300 million litres of finished lubricants annually across the 9-hectare site. This expansion will enable Shell to meet the growing demand of the domestic lubricants market and contribute to the advancement of Indonesia’s downstream industry.

Minister of Industry of the Republic of Indonesia, Agus Gumiwang Kartasasmitawho was represented by Muhammad Khayam, Director General of Chemical, Pharmaceutical and Textile Industries at the groundbreaking ceremony event said, “The non-oil and gas processing industry has seen 4.34% growth in 2019. Indonesia’s attractiveness as an industrial investment hub is reflected from the increase of the Ease of Doing Business Index compared to the previous year. Combining this improvement with other stimulus from the government and the transformation towards industry 4.0 is expected to increase the capacity and industrial utilities of the lubricants industry in Indonesia, aligned with the growth of the entire industry.”

The Minister added that based on the 2019 data, lubricant domestic production only reached 908.36 ML/annum. “Therefore, we appreciate Shell’s commitment to develop the domestic lubricant industry through the expansion of its Marunda LOBP and for successfully obtaining the Indonesian national standard certificate (SPPT SNI) for all of the automotive lubricants products. We hope that PT Shell Indonesia will continue to be the government’s strategic partner in the lubricant industry sector.”

“This important investment demonstrates our confidence in Indonesia and is in line with our strategy to invest in markets where there is growing demand for lubricants,” said Carlos Maurer, Executive Vice President, Shell Global Commercial. “Shell’s Marunda lubricants oil blending plant is already the largest, internationally operated lubricants plant in Indonesia. Doubling its capacity helps Shell expand our business and customer base in Indonesia, one of Southeast Asia’s largest lubricants markets. With Shell’s world-class lubricant production capability and integrated supply chain network, we will be better able to respond to the growing demand in Indonesia for premium lubricants in the automotive, industrial and marine sectors.”

Newly appointed President Director and Country Chair, Shell Indonesia, Dian Andyasuri, said, “Shell is determined to continuously uphold the spirit of ‘Shell Untuk Indonesia‘ by becoming a strategic partner to the Indonesian government in the lubricants industry, an industry partner to push innovation and sustainability forward, and a partner for all our customers to help enhance their mobility with SNI certified and high quality oil products. Through investment in building a world-class automated facility with strong local relevance and sustainable factory operations, Shell hopes to contribute in supporting Indonesia’s ambitions to become one of the largest economies in the world.”

As highlighted in a press statement, Shell became the first international brand to receive the Indonesian National Standard (SNI) for its automotive lubricants products. Three products from Shell, Argina (lubricant for medium speed diesel engines), Rimula (lubricant for heavy-duty diesel engine) and Tellus (lubricant for hydraulic fluids) have received certification from the Ministry of Industry, demonstrating the company’s leadership to comply with local regulations through the compliance of the local content regulation (TKDN). Additionally, Shell operates 29 lubricants oil blending plants globally.