The impact of lubrication on TCO

Lubricants can help increase productivity and reduce total cost of ownership for turbines, transformers and stationary engines, Marcelo Goldberg tells Kelvin Ross

Q: Why do you think that the impact of lubrication on TCO has so often been underestimated or even overlooked?

A: Many companies are already well aware that reducing total cost of ownership (TCO) over the lifetime of machinery is key to extracting the best possible value from their equipment. However, an international study of power companies commissioned by Shell Lubricants showed that many companies are underestimating the potential cost savings and productivity gains from effective equipment lubrication. Some 58 per cent of companies recognize that their choice of lubricant can help reduce costs by 5 per cent or more, but fewer than one in ten (8 per cent) realize that the impact of lubrication could be up to six times greater.

This could be due to a lack of understanding about the potential benefits of lubrication ” including selecting the right product and ensuring it’s managed properly. Even the best lubricant or grease cannot perform if it is not stored, applied and monitored correctly. The same survey also revealed that 59 per cent of those surveyed think they don’t conduct staff training on lubricants as regularly as they should, and only 43 per cent of companies have all the correct procedures in place to manage lubricants effectively.

Q: Are you seeing this changing as customers explore every possible way to maximize flexibility and efficiency to respond to market demands?

A: At a time when power generation, transmission and distribution companies are under pressure to achieve greater productivity and reliability, they are placing more emphasis on improved system efficiency, reliable equipment production and longer oil and equipment life. For power companies looking to make changes to their maintenance practices, expert advice from their lubricants supplier can help.

Q: Has the pace of change you have witnessed ” and responded to ” in the power sector in recent years been the fastest you have encountered in the sector?

A: Globally, the demand for power is increasing, driven by a growing population, mass urbanization, and rapid industrialization of nations like China and India. Over the past few years we have seen increasing demand and new challenges facing the entire power supply chain, from engine manufacturers and their customers, to oil suppliers such as Shell Lubricants. Environmental targets are getting stricter, penalties for supply interruptions more severe, budgets are tighter and operating conditions are tougher. Equipment technology is evolving to deliver greater efficiency, higher output and longer operating life, but this places greater strain on the lubricants. With industry demands only set to increase, Shell Lubricants invests approximately $2 billion in research and development each year, to ensure our lubricants are designed to work in the latest equipment and withstand the higher oil stress.

Q: And is the pace of change in power greater than other sectors you may serve, like mining, shipping or industrial manufacturing?

A: Each sector has its own challenges and we are seeing a rapid pace of change in many of the industries in which we operate. For the power industry, the pressure to keep the lights on has driven a very fast pace of development and adoption of new equipment technology over the last five years.

Q: You’ve launched the Argina oil. At what areas of the power sector is it targeted? And what are the benefits that it offers?

A: The Shell Argina range is designed to meet the needs of marine and power companies operating four-stroke engines on heavy fuel oil. Formulated to withstand higher oil stress, field trials of Shell Argina have shown encouraging results under the toughest operating conditions. Customers using new Shell Argina oils have seen up to 18 per cent less oil consumption and up to 15 per cent better base number (BN) retention. This helps to reduce their cost of lubrication and therefore help lower the total cost of ownership of their equipment. And this is only the start: by coupling the new Shell Argina range with our core lubrication management services, we can help our customers to build technical competencies across their organizations, to implement effective lubrication management procedures and to extract the best possible value from their power equipment.

Q: What is the R&D process for a new oil like Argina ” is it carried out in conjunction with customers? Do customers ask for a specific need, or does Shell develop an innovation and take it to the customer?

A: Collaboration plays an important role in helping steer the development of oils and greases for the latest equipment technology, and strengthens the innovative capabilities of our Shell Lubricants Research & Development teams. It can take up to three years to develop a new product like Shell Argina S5. The process includes close collaboration with engine manufacturers and the companies using the engines, often our customers. The new Shell Argina S5, for example, has been endorsed by Wartsila and approved by leading engine OEMs after extensive field trials that allowed us to validate the oil’s performance in real-life scenarios and demonstrate how it can help improve engine performance, efficiency and reliability.

Q: What role is digitalization and big data playing in lubricants? And how do you anticipate this to develop?

A: Digitalization is all about the speed to communicate, speed to monitor and speed to deliver, which can significantly improve equipment performance, availability and reliability.

At Shell Lubricants, we are investing heavily in digitalization as we believe data is an asset that, if well utilized and interpreted, can help predict engine behaviour, and when used alongside lubrication management services, it can also help to increase oil life. We expect that the application of sensor technology to enable real-time monitoring and analysis of lubricant and equipment performance will play an increasingly important role in lubrication management.

Marcelo Goldberg is Shell Lubricants’ Global Sector Manager for Power.

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