April 10, 2020

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API Lubricant Standards Group rejects ballot to revise definition of base stock marketer
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In December 2019, the American Petroleum Institute’s (API) Lubricant Standards Group (LSG) met to evaluate the recent ballot on API 1509 Annex E. 1.2. The LSG convened in New Orleans, Louisiana, U.S.A., including members of the committee, representatives and interested visitors.

API 1509 describes the voluntary API Engine Oil Licensing and Certification System (EOLCS) and provides marketers with information on how API marks should be licensed and displayed to the consumer. Annex E offers base oil interchangeability guidelines for passenger car motor oils and diesel engine oils.

Ballot 4935 proposed several amendments to establish the definition of base stock manufacturer in Annex E. 1.2, including the designation of “base stock marketer”. A base stock marketer was defined as “the entity that defines the product identifier, specifications and quality management system of base stock(s) which are produced at one or more manufacturing locations under the marketer’s direction, and which are used in API-licensed oils.”

The interpretation of base stock marketer and the clarification that “blending alone or the rebranding of purchased base stocks does not constitute manufacturing” were two of the key changes to the specification. The proposed revisions were part of an effort to more clearly delineate base stock manufacturers and marketers, as well as to establish greater alignment between API and ATIEL, the technical association of the European lubricants industry.

The balloting period commenced on 19 September 2019, with all eligible ballots and comments received by 21 October. A 95% ballot response rate was attained with 20 responses from the 21 ballots issued. The ballot approval rate of 79% exceeded the minimum requirement of 66.66% for a successful vote. Member votes received included 15 affirmative, four negative responses alongside comments, one abstention, and one member did not vote.

Despite the favourable vote, the addition of the base stock manufacturer definitions were subsequently rejected by the LSG. While members were generally supportive of efforts to improve the system by ensuring definitions are easier to understand, several issues were raised during discourse of the balloted changes.

BP Lubricants USA deemed that the intended changes would fail to achieve the desired consistency with API’s European counterpart. The ATIEL code of practice clearly defines a “base stock manufacturer” but does not employ the term “base stock marketer” at all, advised BP Lubricants USA representative Barbara Dennis. Dennis also indicated that the new terminology in Annex E would create “immense confusion” with the remainder of API 1509 where the term “marketer” is used to denote an oil marketer. Widespread clarification of what a marketer, base oil manufacturer, and base oil marketer would be required throughout API 1509. BP Lubricants USA called for the removal of the term “base oil marketer” to harmonise the document with ATIEL’s definition.

API Lubricant Standards Group rejects ballot to revise definition of base stock marketer

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Chevron submitted that the definitions lacked consistency with the body of API 1509. Reference to base stock marketers as an “entity” contrasts with explicit reference to lubricant marketers as a “marketing organisation” throughout the document. The organisation stressed that consistency within API 1509 for establishing definition parity between marketers of lubricants and base stocks is “more important than alignment with European definitions.” Chevron recommended a new ballot to clarify the simultaneous use of the terminology.

Valvoline asserted there was no reason for the standing definitions to be revised and raised additional concerns relating to the base oil interchange (BOI) guidelines. The existing definitions provide “appropriate underpinning for the ensuing BOI tables” and balloted changes “imply restrictions on BOI based upon who markets the base stock.” The definition should be crafted in such a way that BOI guidelines are not muddled by the ever-changing commercial landscape, says Valvoline. The company suggested the appropriate path forward was to retain the existing definitions in Appendix E, with amendments to Appendix I.

Ernie Henderson of Oklahoma City-based K&E Petroleum Consulting LLC says the changes do not necessarily reflect the circumstances of his clients. Henderson raised issues with the statement that base stocks are manufactured at the direction of a single base stock marketer, citing examples where base stocks are manufactured at the direction of two marketers. He also highlighted discrepancies over whether the marketer or manufacturer controls the specifications. Henderson proposed that the existing definition be retained while further review and clarification can be completed by the working group.

Once specifications become established, they are difficult to change. Despite a positive ballot, the LSG made the decision not to proceed with the balloted changes to API 1509 and that ballot 4935 E-2-1-Definitions-w- Base-Stock-Marketer has failed. Further steps in the revision of API 1509 Annex E. 1.2, if any, are still to be advised.

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