Chevron completes purchase of Neste’s Group III base oil unit
Chevron Global Energy Inc., a wholly owned subsidiary of Chevron Corporation, has closed its agreement with Neste Corporation to acquire its NEXBASE™ brand, associated qualifications and approvals, and related sales and marketing business. In October 2021, Neste Corporation announced that it had signed an agreement to sell its existing base oils business to Chevron Global Energy Inc.
With this acquisition, Chevron is now a supplier of both Group II and Group III base oils. In addition, Chevron is an equity partner in Novvi LLC, a California-based company which produces base oils from renewable sources in Deer Park, Houston, Texas, U.S.A.
The two companies started collaborating in 2019 when Neste started producing Group III base oils at Chevron’s base oil plant in Richmond, California, U.S.A.
Neste primarily produces Group III base oil at its refinery in Porvoo, Finland. It also had a joint venture in Bahrain with Bahrain Petroleum Company (Bapco) and Nogaholding. Neste announced that it has now completed its exit from this base oils joint venture.
With the divestment of its base oil business, the Finnish company’s primary focus will be on renewable fuels, where it has become a global leader.
As part of the acquisition, Chevron will maintain all current supply sources utilizing long-term offtake agreements, it announced.
The transaction includes the NEXBASE™ brand, associated qualifications and approvals, and related sales and marketing business. As part of the divestment, the parties also agreed on a long-term offtake for Neste’s base oils supply from Porvoo, Finland. With the same date, Neste signed an agreement to exit its base oils joint venture with Bahrain Petroleum Company and Nogaholding.
“Adding the NEXBASETM brand and associated business to Chevron strengthens our position as a leading supplier of premium base oils to customers globally,” said Alicia Logan, general manager of Chevron Base Oils. “We are pleased to welcome Neste employees to Chevron and look forward to leveraging their experience and talents to continue to reliably supply premium base oils to our customers. With the addition of a fully approved global slate of Group III and renewable base oils that complement our Group II global slate, Chevron is well positioned to be the base oil partner of choice for today and into the future.”