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Sparking the transformer oil market

Identifying the transformer oil demand in the region is tricky

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Hendrik Cosemans, GM, Nynas ME
Hendrik Cosemans, GM, Nynas ME

Hendrik Cosemans, GM, Nynas ME, talks to UME about the transformer oil market in the region.

How’s business?

As a European refiner, we are passing through some rough times but the future will be bright. Europe starts slowly picking up again and Nynas will be ready to cover the extra demands from the market for Naphthenic oils.

We have recently received the green light from the European Commission to acquire the Shell refinery in Harburg, north of Germany, and will incorporate this naphthenic production unit in our supply system. It will enable us to achieve extra growth since many Group I refineries in Europe are about to close, creating some gaps for oils with better properties such like solvency etc.

As to the Middle East, that I head, business is doing great and will only become greater business is doing great and will only become greater. The current talks with Iran and imminent release of sanctions will re-open this market, next to the continuous increased demand from GCC countries all around.

What kind of demand for transformer oil do you see in the Middle East?

The demand is directly linked to population increase, economic development and energy investments. The GCC countries are on a clear path forwards and with Expo 2020 in Dubai the region will become indispensable.

To identify the transformer oil demand is quite tricky as too many projects in the region determine the demand, and they often get extended or expanded.

We also see that for smaller transformers, such as distribution transformers, the customers do not always put forward the most up-to date oil requirements, resulting in these small transformers to be ‘disposable units with limited life-time’. In the case of larger and certainly power transformers, we do not see this happening as each unit is an expensive one, thus every component has to be of top notch quality. Imagine the increase in efficiency if the same latest available standard for oil was applied for the distribution transformers, the total cost for society would decrease tremendously.

How much is it expected to grow?

When dealing from Dubai’s office with more than 15 countries, it is difficult and it would be disrespectful to compare one country to another, as each country chooses its own way of development. With the recent evolution in the Arab world and the search for better conditions, it is clear that the region still has a lot of growth potential.

We see Saudi Arabia investing heavily and realising a lot of new projects, our sales have more than doubled into the Kingdom.

Whilst some countries remained stable, despite internal conflicts, we have seen a steady increase of average 30 per cent - 40 per cent in the Middle Eastern region, which is a significant growth.

These are very positive figures and only possible via our network of agents and distributors throughout the GCC, in close cooperation with our Dubai office.

Would you like to talk about your latest technological innovations?

Our niche markets are different than those of the large (fuel) refiners and our sales & technical network is present worldwide. We follow standards like ASTM but even more IEC that is stricter and has adapted the requirements for transformer oils recently in Feb 2012. We now have the 4th edition of IEC 60296 and this edition comprises new elements that are crucial for getting the best quality transformer oils available today, with the latest production techniques.

Naphthenic oils have a long history as transformer oils and all OEM have vast experience with our oils. We have a full range of uninhibited or inhibited oils. Especially in the Middle East, where temperatures can rise very high, the Viscosity Index of these naphthenic oils render proper cooling for the important assets that are the transformers and they deliver great oxidation stability in this harsh climate.

As a specialist in the field of insulating liquids, our well respected Dr. Bruce Pahlavanpour, Senior Technical Coordinator has been appointed Chairman of IEC Technical committee 10, Fluids for electrotechnical applications, from 2013-09-01 to 2019-08-31.

The committee will lay the path for future product specifications, test methods as well as maintenance and use guides for liquid and gaseous dielectrics.

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