Romanian Green Oil and Lubes company will soon have a recycling plant for waste lubricant oil. The goal is to transform oil waste into base oils so it could be reused in the automotive and industrial sector.
The 73.000 metric-tonne recycling facility will be built in southern part of Romania, on the shore of the Danube river. The whole project is worth USD 56 million.
The idea is to have a majority of waste oil in the country collected in this new recycling plant. Base oils that will come as a product should be affordable for local customers.
In Romania, only around 50 per cent of waste lubricant oil is collected.
The European Bank for Reconstruction and Development (EBRD) and Banca Comerciala Romana (BCR) will support the project with a total of USD 38.7 million club loan, the EBRD said in the statement.
Both EBRD and BCR will provide USD 30 million term loan, divided in equal measure.
Another USD 26 million will secure Chemie-Tech DMCC, a group of companies based in the UAE. Romanian Green Oil and Lubes SRL belongs to this group.
In addition to the loan that BCR shares with EBRD, Romanian bank will also provide additional USD 8.7 million for the financing of working-capital needs and recoverable project related VAT.
In Romania, only a half of lubricant waste oil is collected and mainly used as fuel for producing heat, generating significant quantities of greenhouse gas emissions.
On average every liter of lubricant oil generates 0.5 liters of waste lubricant oil.
Matteo Patrone, EBRD Regional Director for Romania and Bulgaria said that this project is a highly innovative greenfield investment and focuses on the circular economy.
With its Green Economy Transition approach, the EBRD wants to raise its investment in the area of green economy to more than 40% of annual business investment by 2020.
So far, the Bank is a leading investor in Romania with EUR 7.5 billion in 400 projects. This year alone, the Bank has signed more than 20 projects worth over EUR 400 million, reads the bank statement.