Hitting the Accelerator

Globally, the chase for natural resources has been one of the economic undercurrents throughout this decade.

A surge in demand for basic materials, agricultural commodities and energy has accompanied the economic growth in China, India and other parts of the world where large new middle classes are emerging.

For recyclers, this strain on resources has caused volatility in their markets, but it also has created tremendous new opportunities.

Among the companies taking advantage of these opportunities are Evergreen Oil and Chemical Engineering Partners (CEP), both based in Irvine, Calif.

While Evergreen Oil is bolstering the market for the recycling of engine oil and lubricants in the Western United States, CEP is exporting the oil recycling technology to nations throughout the world.

Gary Colbert, president of Evergreen Oil, says his company is one of only two in the United States that is able to re-refine used engine oil back into a base oil that returns to the market as engine oil. Other recyclers either create a refined fuel product or burn the spent oil as a heating oil or energy source.

Evergreen is currently working with consultant Robert Sulnick to lobby California’s state legislature to change the state’s recycling incentive program to recognize re-refiners as providing a form of recycling that does the most to boost the state’s economy.

Currently, the state offers an equal per-gallon incentive to oil recyclers of all kinds, including those who ship collected oil in tankers to other states to be burned as fuel—even if those other states do not adhere to the same clean-air standards, Sulnick points out.

Sulnick and Evergreen contend that the re-refining process used by Evergreen not only offers the highest value recycling option but it is also the most environmentally sound.

The company uses a combination of processes, including de-watering, hydro-treating, vacuuming, evaporation and fractionating to produce a base oil that can be used to make up 75 percent of the blend of new engine oil or lubricant. It is a product that "meets or exceeds virgin standards," according to Colbert. The entire process turns dirty engine oil into a desirable product in less than 24 hours, Colbert says.

Many of the non-petroleum fractions also are recycled, he adds, in such applications as an asphalt fluxing agent.

Currently, the Evergreen facility in Newark, Calif., accepts some 13.5 million gallons of spent motor oil and produces 10 million gallons of re-refined base oil. As Colbert points out, in a 75/25 blend, that matches up as enough base oil to go into about 13.5 million gallons of new engine oil or other lubricant.

The net result is an effective closed loop. "Used oil never wears out," says Sulnick. "It can be endlessly cleaned and re-refined in a ‘closed loop,’ thereby conserving energy, reducing greenhouse gas emissions and reducing toxic pollution."

The resource conservation aspect of this closed loop is proving to be appealing not only to Californians and Americans, but to potential customers of the technology throughout the world.

The rising cost of petroleum in the second half of this decade seems to have convinced governments and investors throughout the world that re-refining engine oil and lubricants is a sensible endeavor.

CEP, the affiliated company that supplies the technology used by Evergreen, is currently responding to an unprecedented number of inquiries from parties throughout the world interested in licensing the closed-loop re-refining technology.

According to Colbert and Sulnick, CEP is in the process of responding to more than 40 inquiries that, remarkably enough, come from more than 40 different nations.

"I think re-refining is going to become institutionalized worldwide," says Sulnick. "I think it’s inevitable, and that’s what you’re seeing starting to happen with all of these inquiries and orders from CEP."

The process not only reduces oil dependence in a given region or nation, it also does so in an energy efficient manner, says Sulnick.

Colbert notes that while it takes 42 gallons of crude oil to create 2.5 quarts of engine-grade lubricating oil, it takes only one gallon of used, re-refined oil to create 2.5 quarts of engine oil. "That’s a key reason why people from around the world are coming to CEP," says Sulnick.

In California and adjacent regions for Evergreen Oil and throughout the world for CEP, the growth potential for oil recycling is considerable.

Nationally, the figure offered by Sulnick is that the United States generates 1.3 billion gallons of spent engine oil and lubricants. "By re-refining the 1.3 billion gallons, the nation would save 2.5 million gallons of oil per day," Sulnick says.

The foremost challenge for Evergreen has been to collect a larger share of the oil that is generated, especially in the face of the California law that provides an equal incentive for competitors who collect the oil only to truck it out of state to be burned as fuel. (See "Clean, Don’t Burn" sidebar below.)

It’s a challenge the company says it can meet with a corporate strategy that is not defensive, but geared toward growth.

While CEP’s employees stay involved with projects in other parts of the United States and around the world, Evergreen is undergoing expansion at its Newark facility beyond its 13 million gallons of re-refining capacity to 18 million gallons.

New facilities are also a possibility for Evergreen. For several years the company has been stepping through the always-slow process to obtain permits to locate a refining facility in Southern California.

With the addition of that facility, Evergreen can collect used oil from all over California and parts of adjacent states while continuing to ship finished product to all of North America.

"I believe we are in the right business," Colbert says. "We like to call it a concept whose time has come. We’ve been green since before the rest of the world thought of being green."