You are here: Home » Reuters » News
Business Standard

Royal Dutch Shell doubles lubricant sales in Russia in four years

Reuters  |  TORZHOK, Russia 

By Astakhova

TORZHOK, (Reuters) - Royal Dutch Shell, which was forced to limit its presence in Russia's upstream sector because of Western sanctions, has seen its lubricant sales in the country double since 2014, the of one of its plants there said.

Shell launched its lubricants plant in Russia's northwest in 2012, with the aim of producing up to 200 million litres a year. The factory plans to reach that capacity in 2027, and currently produces around 90 million litres a year.

"Compared to 2014, we have seen our (sales) portfolio almost doubling," Maxim Solovyov, of the plant, told in an interview.

Apart from its own lubricants production at Torzhok, Shell imports another 30 million litres per year into from its plants elsewhere to sell them in the region.

After the rouble weakened amid sanctions and three years ago, lubricant production for Shell in became more profitable, Solovyov said, as the company's global costs are in U.S. dollars.

"Russia is one of our priority (lubricant) markets along with Mexico, China, and In these countries Shell plans the most rapid growth during the next 10 years," Solovyov said.

Russia's was a high-profile victim of the country's economic downturn but returned to growth last year. The PwC consultancy expects Russian new to grow by 11 percent this year.

The plant also sends lubricants to Belarus, Kazakhstan, and Mongolia, Solovyov said, adding that in 2014, the factory's sales were almost entirely domestic.

Shell holds a stake in the Sakhalin-2 liquefied in Russia's far east, the country's biggest so far, but the shareholders led by have been unable to agree on the final terms of an output expansion.

Shell also suspended its with Neft, Gazprom's oil unit, after the introduction of sanctions.

(Writing by Katya Golubkova; Editing by Dale Hudson)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, March 13 2018. 21:31 IST