PCN Europe: Could you give us some information on the history of Shell Lubricants? What are the figures and trends of the sector?
R. Paganuzzi: Shell experience in the research of technological solutions in the field of lubrication boasts a history of over 70 years. First activities get back to 1940. In the Sixties, Shell was the first manufacturer that launched on the market multigrade engine oils to be used on all the vehicles and in all seasons: in the Seventies, Shell introduced the use of cleansers in the formulation of lubricants for cars to keep the engine cleaned. We get to 2004, when a new global organization for lubricants is founded, Shell Lubricants, the Group Royal Dutch Shell Division specialized in the business of lubricants with different product applications that include automotive, heavy transportation and the industrial sector.
As regards the Lubricants sector, it is possible to register a growth at a global level, even if European trends are more stable compared to America and Asia where the demand raises faster. Italy is a mature market, whose main characteristic is high penetration of synthetic oils, also for more stringent regulations on emissions control. In Italy, Shell has got a market share of 10% in the lubricant industry, in line with the trend in the sector at a global level.
PCN Europe: What is Shell Lubricants’ mission?
R. Paganuzzi: Among our main objectives, we aim to develop highly technological and innovative products to reply to client needs in the industrial and end user sectors. Our commitment in the field of research and development leads us to have more than 250 patents in the lubricants sector, with more than 200 technicians and engineers committed to the development of technologies applied to products.
Shell approach to technology is based on three pillars: Innovation, Application of technologies to products and partnership. We work side by side with customers, leading companies and OEM (Original Equipment Manufacturer) that face challenges of high technological value. Thanks to them, we can improve our skills, transfer them into products and make them available on the market. Today, more than ever, we believe in what we decided to put on paper: “Together, Anything is Possible”.
PCN Europe: Talking about GTL, how the idea to produce a lubricant starting from natural gas was born?
R. Paganuzzi: Speaking about the origins of Shell commitment on the theme of Gas to Liquid, it’s necessary to take another step back into the past, to 40 years ago. Started in 1973 at the Shell Technology Center of Amsterdam, the research on GTL was developed through the construction of a first pilot plant right inside the Technology Center of Amsterdam in 1983 and a production plant in Malaysia in early Nineties.
Qatar Plant, Pearl GTL, was inaugurated in 2011 and is one of the biggest plants ever built in the energy industry. With a production capacity of 260.000 barrels per day, it’s the most important source of GTL products at a global level.
For us there’s no innovation without application to products. This philosophy guided the willing to develop an exclusive technology, the Shell PurePlus Technology, a process that converts natural gas into a crystalline synthetic base oil, which is basically free from the typical impurities of crude oil. Thanks to this technology, Shell uses chemical engineering to develop the molecules for the engine oil, creating long chain carbon molecules, which are the ideal basis for pure and cleaned base oil production.
PCN Europe: With regard to your new motto “Together, Anything is Possible”, what type of collaboration have you established with your clients?
R. Paganuzzi: “Together, Anything is Possible” expresses our idea of relationship and approach to the client. Together we can do everything. We don’t want to be mere manufacturers and suppliers but actual partners that make their skills available and are at the same time opened to discussion for a constant improvement. This is true towards our clients, our partners in the field of MotorSport and numerous OEM that collaborate with us.
The relationship with the customer can be summed up in three main steps: “Select”, “Use” and “Improve”. “Select” is the moment of knowledge and advice to guarantee the choice of the best lubricant in line with customer’s needs. “Use” is the moment of consultation given during the employment of the lubricant, also thanks to the many support services available. In the final step of “Improve”, we listen to customer’s feedbacks to improve the product and develop new solutions. An approach that our clients appreciate a lot, and that generates trust and value. I am glad to remember that Shell Lubricants was awarded for the tenth year in a row the First Lubricants Supplier in the world, according to the report Kline & Company Global Lubricants Industry.
PCN Europe: Did you notice any specific market where the industrial client is more responsive to technological progress?
R. Paganuzzi: I consider that from that point of view Europe presents very similar situations. The attitude of the Italian industrial customer is not that different than the attitude of UK customers. The experiences linked to technical service confirm the preference for face-to-face meetings in the first steps of the collaboration. The first meetings are fundamental to get to know the client, understand challenges and needs, and listen to requests to meet client’s expectations. Usually, this is an individual step that involves TCO – Total Cost of Ownership – analysis, which represents the total amount of expenses for industrial equipment focusing on three different information: the cost for the machine, maintenance costs and extra costs coming from a potential unexpected downtime, often underestimated by the client. During this step, we employ tools and online platforms that, thanks to their ability to establish a direct dialogue with clients and conduct the analysis on field, make possible to define the best product for them. Often, it’s just in a second phase that we see the openness of the client to the use of digital and virtual channels.
PCN Europe: What’s Shell commitment in the development of more sustainable products?
R. Paganuzzi: Technologies in rapid evolution, changes in consumer needs and new regulations are just several elements that make the scenario in which we operate dynamic. Shell ability to innovate translates into important activities in products research and development, to predict market needs, but not only. Innovation and technology are fundamental to reply to the growing energy demand in a general way while optimizing efficiency and sustainability of traditional business processes and opening to the development of new solutions. Shell invests more than 1 billion dollars in research and development, with 45.000 experts and scientists that work in 16 research centers in the world, to develop more and more sustainable ideas. GTL technology is a good example of this commitment, since it is a technology patented by Shell which allows to transform natural gas into cleaned fuels and lubricants. The process may seem simple, however years of research and more than 3.500 patents have been necessary, until the goal of Pearl GTL.