Neste said it has resolved its dispute with Bahrain Petroleum Company (BAPCO) and Nogaholding, the investment and business development arm of Bahrain’s National Oil and Gas Authority (NOGA) , over the marketing of BAPCO’s Group III base oils produced from the lube oil refinery in Sitra on the east coast of Bahrain.
The Bahrain Lube Base Oil Company is a joint venture between nogaholding, Neste Oil of Finland and BAPCO. The Group IIII base oil plant, which was commissioned in October 2011 has a capacity of 400,000 tonnes per annum. The total project cost was USD430 million. BAPCO was in charge of operating the plant, while Neste was supposed to market the base oils produced from the plant under Neste’s NEXBASE® brand globally.
Neste had a 45% stake in the joint venture plant and the company’s share of the investment cost was EUR130 million (USD145.7 million). The plant’s output consisting of Group III base oil varies in viscosity from 4cSt to 8cSt.
On 10 June 2019, Neste announced in a press statement that the “dispute that had arisen between them and Nogaholding and Bapco in relation to the marketing of their joint venture lubricants base oil plant in Sitra, Bahrain, has been amicably resolved. They look forward to continuing to work together in relation to their joint venture.”
There have been a lot of rumors surrounding the Neste-BAPCO dispute. When contacted by F&L Asia for further details, Neste replied that the “terms of the amicable resolution are confidential, and the parties look forward to continuing to work together in their joint venture.”