HPCL, Tata Motors to jointly create circularity ecosystem for used oil, says Ch Srinivas

Ch Srinivas, ED-Lubes, HPCL

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As India accelerates its transition towards a circular and resource-efficient economy, the management of used automotive lubricants remains an under-addressed environmental challenge.

Classified as hazardous waste, used oil is often improperly disposed of through burning, dumping or informal recycling channels, posing significant risks to health and the environment. Estimates suggest that only 15-20 per cent is routed to authorised recyclers, leaving a vast majority outside the formal ecosystem.

Against this backdrop, Hindustan Petroleum Corporation (HPCL) and Tata Motors have signed a memorandum of understanding to pilot a structured and scalable model for the collection, traceability and recycling of used automotive lubricants.

The initiative aims to create an organised value chain that converts used oil into high-quality re-refined base oil, reducing environmental impact while improving resource efficiency.

In an exclusive interview with ETAuto, Ch Srinivas, Executive Director – Lubes, HPCL, discusses the scale of the challenge, the opportunities in re-refining, the role of technology and traceability. Edited excerpts:

What is the objective of the joint pilot of HPCL and Tata Motors in used oil recycling?

Used oil is a hazardous waste and needs organised handling. In the current ecosystem, most activities like the collection and recycling of used oil are unorganised. Only about 15-20 per cent is channelised to recyclers, while the rest goes in alternative modes like burning or dumping, which is not only hazardous but, being carcinogenic, poses severe health risks to people.

Producers and generators, therefore, have to combine their efforts to develop the ecosystem so that used oil is responsibly channelised. HPCL and Tata Motors seek to jointly foster the creation of an ecosystem for circularity in used oil.

How large is the problem of improperly disposed automotive lubricants both from an environmental and economic standpoint?

Just one litre of used oil can contaminate one million litres of fresh water which is a year’s supply for 50 people. Used oils accumulate toxic substances during use, including heavy metals (lead, zinc, cadmium), benzene, and polycyclic aromatic hydrocarbons (PAHs) that pose severe threats like carcinogenicity and habitat destruction if dumped in soil or waterways.

It requires about 100 litres of crude oil to produce one litre of virgin base oil, whereas 100 litres of used oil can yield up to 70 to 80 litres of re-refined base oil, and even the balance can be valorised, effectively nil wastage. About 15 per cent of used oil is only processed.

How will this partnership help strengthen the extended producer responsibility framework?

This is a collaborative effort to combine resources in respective areas of activity to integrate the processes of collection, channelising and re-refining. It is in the direction of creating the necessary ecosystem which, in turn, can provide a platform for various stakeholders that is not yet developed on organised lines.

Can you explain how the collection and recycling model functions on the ground from service centres to re-refining?

The organised working model requires structured activities involving various process steps. The lube oil circularity starts with adopting proper segregation practices at the generation point, collection through Central Pollution Control Board (CPCB) registered collecting agents, ensuring traceability at every step and processing it into re-refined base oil as per specifications meeting IS18722.

It is also important that the RRBO (re-refined base oil) is eventually used in lubricant formulation for achieving the ultimate goal of circularity for which lubricant manufacturers and automobile OEMs need to work together.

What role will Tata Motors’ authorised service network play in ensuring traceability and responsible disposal of used lubricants?

HPCL and Tata Motors will work towards ensuring collection. The Tata Motors service network will act as the primary anchor for organised collection. The network will ensure that this oil is sold only to registered re-refiners, and the same will be monitored through a tracking system to guarantee traceability and prevent leakage into the informal sector.

How does HPCL enable creating the circularity ecosystem for used lube oils?

HPCL will enable creating a supply chain from consumers of lube oil by bringing together the consumer, collection agents, and refiners and enabling seamless flow of product to its lube manufacturing plants. Tie ups with large automotive manufacturers and industrial customers will standardise the activities involved and develop this industry on defined and organised lines. Furthermore, HPCL will ensure scalability by checking the specifications for RRBO against IS:18722 Part 1 standards. The compliant RRBO can be reused for the manufacture of fresh lubricants.

What technologies or processes are being deployed to convert used oil into high-quality re-refined base oil?

Historically, recyclers relied heavily on the acid-clay treatment method, which is not environmentally friendly and generates hazardous sludge. This process was therefore banned by CPCB. However, the industry is transitioning towards advanced global technologies, including vacuum distillation with thin film evaporator, hydroprocessing and advanced solvent extraction.

How comparable is re-refined base oil to virgin base oil in terms of performance and quality? Is re-refining commercially viable?

When appropriately processed, re-refined base oil is virtually indistinguishable from virgin base oil. It successfully meets IS:18722 Part 1, RRBO specifications.

Commercial viability of RRBO in India is constrained, and due to severe feedstock shortages and high procurement costs, re-refined base oil in India often costs more than virgin base oil. However, after the development of a proper supply chain, it is expected to be viable through cost efficiencies.

Will this pilot eventually evolve into a pan-India industry framework involving multiple OEMs and lubricant manufacturers?

Yes, through this MoU, it is the endeavour of both parties to ensure that a viable ecosystem is established which can be scaled across the country.

What are the biggest operational challenges in building a nationwide used lubricant circularity ecosystem in India?

The primary challenges include:

Informal collection Market: Activities of unorganised kabadiwalas and independent garages are not accountable. Used oil is misused as fuel or dumped, which poses a hazard to the environment.

Low-capacity utilisation: Due to the broken collection network, re-refiners run at low capacity, often 15-20 per cent of installed capacity.

Technology: The equipment of today and the BS6 regime demands Group II / Group III level base oils, which is not possible with thin film evaporator technology.

Are there plans to use digital solutions for the used oil supply chain?

Producers are trying to deploy a tracking system to monitor the retrieval and safe disposal of used oil across their service stations.

How can fleet operators and commercial vehicle owners be incentivised to participate more actively in responsible lubricant disposal?

For fleet operators (like state transport undertakings) and commercial entities, the used oil generators are required to legally dispose of oil through CPCB-authorised collection agents who, in turn, are required to route it to re-refiners.