Leading the Field: Building a World-Class R&D Base - An Investigation of the Lubricant Company's Dalian R&D Center (Part 1)

Cutting the treat rate of the additive package for cylinder oil (one of the marine lubricants) from 26.5% to 22% - what does that 4.5-percentage-point difference actually mean? "A 4.5% reduction puts us at the world's most advanced level," said Zhai Yuekui, director of the Dalian Research and Development Center of the Lubricant Company. "Over the past few years the Dalian R&D Center has devoted itself to lubricant research. This reduction in treat rate alone has cut the production cost of cylinder oil by 10% per tonne, adding another important bargaining chip in developing both the domestic and the overseas market."
Opening the door to international markets
"Kunlun marine lubricants rank first in domestic sales, accounting for 60% of the domestic duty-paid oil market," Zhai Yuekui said. Such a high market share is underpinned by the Dalian R&D Center's strong research capability in the marine oil segment.
Its share of the naval vessel lubricant market is especially high - more than 90% of the lubricants used by the navy are Kunlun products. The general-purpose diesel engine oil for naval vessels developed by the Dalian R&D Center has also been successfully deployed with the Chinese Navy's escort task force in the Gulf of Aden, withstanding the test of real operations.
Ships move across the world, so marine lubricants have an even greater need for an international brand. "And obtaining certification is the first step toward the international market," said Dr. Liu Gongde, director of the Oil Products Institute at the Dalian R&D Center.
Wartsila and MAN B&W, the two largest marine engine manufacturers, account for 95% of the low-speed engine market. A single certificate stating that a lubricant "can be used in all engine models of the company" is the prize every lubricant maker wants to claim.
In 2007 the Dalian R&D Center obtained a shipboard testing permit from Wartsila, meaning that the marine lubricants it produces could be tested on vessels fitted with Wartsila engines. The center contacted Maersk, the world's largest shipping company, applied its marine cylinder oil on a vessel powered by a 35,000 kW engine, and began a 4,000-hour shipboard trial.
At the end of 2007 Wartsila issued certification, but with a term of only one year, on the grounds that the new supplier had too little application experience. Not long afterwards, however, Maersk reported severe coking with the marine cylinder oil supplied by Dalian R&D - this occurred during a 1,000-hour supplementary certification run on Maersk's most powerful and most technologically advanced vessel. A Wartsila expert emailed Liu Gongde saying that the certification would very likely be revoked.
"Our advantage lies in Dushanzi's naphthenate - our cylinder oil additives are excellent, and in China only CNPC has them; they are rare worldwide as well." The Dalian R&D Center proactively contacted Wartsila and Maersk and carried out repeated self-inspections. After months of multiple rounds of testing, the problem was finally traced to a lubricant from a well-known international company that Maersk had subsequently introduced.
In October 2008 Wartsila issued certification once again: it recommended Kunlun marine cylinder oil for use in all Wartsila two-stroke marine engines. This time it was lifetime certification. Maersk's fluid technology company also wrote to say that the Dalian R&D Center had investigated thoroughly and acted swiftly, and had demonstrated real expertise.
Today, Dalian R&D's marine cylinder oil and system oil have respectively passed Wartsila and MAN B&W technical certification, obtaining a passport to the international market and placing Kunlun marine oil among the ranks of well-known international marine oil brands.
Supporting the localization of engines
As China entered the automobile era, demand for locally manufactured engines increased, yet foreign lubricants could not fully meet domestic requirements. In step with engine localization, the localization of lubricants was also put on the agenda.
Since 2003, in order to seize this high ground in the market, the Dalian R&D Center has stepped up joint lubricant development with OEMs (original equipment manufacturers). Wang Hongbin, head of the Technical Service Department, said: "We have now established cooperative relationships with FAW-Volkswagen, SAIC Motor, GAC Group, Sinotruk, Shandong Linyi Construction Machinery and Hafei, among others, to jointly develop suitable lubricants."
Dalian R&D has completed development of the dedicated oil for FAW Dachai Deutz engines and has become their sole designated factory-fill and service oil. It has also become the sole designated factory-fill and service oil for SAIC Rover engines, while its dedicated four-stroke motorcycle oil for Wuyang-Honda has reached sales of nearly 10,000 tonnes.
After the national "Ninth Five-Year Plan" key scientific and technological project "Research on Dexron III Automatic Transmission Fluid" was completed, China's only automatic transmission fluid product with independent intellectual property rights was also born at Dalian R&D. It has now become the factory-fill and service oil for Harbin Aircraft Manufacturing Corporation, Jinan Sinotruk, Zhengzhou Yutong and BeiBen Trucks, among others.
OEM oils for the group's internal market have also advanced smoothly. At the evaluation center, an engine from the Jinan Diesel Engine Plant has already been installed in the new laboratory and will soon undergo bench testing. It is understood that the series of highly reliable products developed by Dalian R&D - including oilfield drilling engine oil, natural gas engine oil, dual-fuel engine oil and biogas engine oil - have been written into the specifications of Jichai products in their entirety.
In 2009, the Dalian R&D pilot plant produced 12,300 tonnes of specialty lubricants and additives and generated sales revenue of 213 million yuan, a record high. Thirteen research achievements were industrially commercialized during the year, and the new products won high recognition from users. Ten years ago, when the lubricant company was founded, it was still an open question how much a Dalian R&D center could contribute within a sales-driven enterprise. Today, the Dalian R&D Center has its answer to how technology can drive the market and lead corporate development.