Vertex Energy Advances Major Group III Base Oil Expansion Project at Mobile Refinery
Vertex Energy, Inc. has announced plans to move forward with a significant expansion project at its refinery in Mobile, Alabama, aimed at increasing domestic production of high-quality conventional Group III base oils. The initiative represents an important step in the company’s strategy to diversify revenue streams, strengthen profitability, and enhance its position within the North American lubricants market.
The project is designed to leverage Vertex’s existing refining and hydroprocessing assets to produce crude-derived conventional Group III base oils, a key ingredient used in the formulation of premium automotive and industrial lubricants. Once completed, the expansion is expected to add approximately 6,000 barrels per day (bpd) of conventional Group III production capacity, substantially increasing the company’s overall output and establishing Vertex as one of the leading suppliers of Group III base oils in North America.
The planned development will utilize the company’s existing hydrocracker and associated processing infrastructure at the Mobile refinery. By integrating new processing capabilities with current operations, Vertex intends to efficiently convert hydrocracked vacuum gas oil streams into high-performance lubricant base stocks. The project will focus on producing three of the most commonly used viscosity grades in the market—4 centistoke (cSt), 6 cSt, and 8 cSt conventional Group III base oils.
Industry demand for Group III base oils has continued to grow in recent years as lubricant manufacturers increasingly require higher-quality feedstocks to meet stricter engine performance standards, fuel economy regulations, and equipment durability requirements. Group III base oils are valued for their superior purity, oxidation stability, low volatility, and excellent viscosity characteristics, making them a preferred choice for modern synthetic and semi-synthetic lubricant formulations.
Vertex believes that expanding domestic production capacity will help address market demand while reducing dependence on imported Group III supplies. The company expects the project to provide lubricant manufacturers, blenders, and marketers with an additional reliable source of premium-quality base oils produced within the United States.
According to the company, the feedstock for the new production line will come from an existing hydrocracked vacuum gas oil stream already generated at the Mobile refinery. This approach allows Vertex to capitalize on current refinery operations while minimizing the need for entirely new upstream processing facilities. By utilizing existing assets, the company expects to improve capital efficiency and accelerate the pathway toward commercial production.
The expansion project also aligns with broader industry trends that emphasize supply chain resilience and domestic manufacturing. Lubricant producers have increasingly sought dependable local sources of high-performance base oils amid ongoing global supply disruptions and market volatility. Vertex’s planned capacity addition is expected to contribute to strengthening the North American supply chain and provide customers with greater sourcing flexibility.
Company leadership views the project as an important component of Vertex’s long-term growth strategy. Mark Smith, Chief Executive Officer of Vertex Energy, described the initiative as a major milestone that supports the company’s objectives of enhancing profitability and creating more stable margins across market cycles.
Smith noted that the combination of the planned investments and the refinery’s existing hydrocracker infrastructure creates a strong opportunity for Vertex to enter and compete in the conventional Group III base oil market. He emphasized that the project positions the company to meet customer demand for dependable domestic supply while expanding its participation in higher-value specialty product markets.
The Mobile refinery has already become a key strategic asset within Vertex’s portfolio. Located along the U.S. Gulf Coast, the facility benefits from access to extensive transportation networks, feedstock supplies, and major lubricant manufacturing markets. The refinery currently produces a variety of transportation fuels and specialty products, and the addition of conventional Group III production capabilities is expected to further diversify its product slate.
Vertex has already completed preliminary engineering and design work associated with the expansion. As part of the project’s development, the company has also secured a high-pressure lubricants hydrotreating unit, a critical piece of equipment that will play an essential role in upgrading feedstocks into premium-quality base oils. The procurement of this unit represents an important milestone in advancing the project from the planning stage toward implementation.
The company’s current timeline calls for conventional Group III base oil production to begin in 2029. Over the next several years, Vertex will continue detailed engineering, project execution, and integration activities to prepare the Mobile facility for commercial operations.
An important aspect of the expansion is its complementary relationship with Vertex’s existing re-refined base oil business. The company is already recognized for producing re-refined Group III base oils derived from used motor oil and other recycled feedstocks. These products support sustainability objectives by reducing waste and extending the lifecycle of valuable hydrocarbon resources.
With the addition of crude-derived conventional Group III production, Vertex will operate a unique platform that combines both re-refined and conventional Group III manufacturing capabilities. This dual approach is expected to provide customers with a broader range of product options while enhancing supply reliability.
The company plans to continue producing transportation fuels alongside its existing 4 cSt and 6 cSt re-refined Group III base oils as part of its integrated refining and specialty products platform. The new conventional Group III capacity will supplement rather than replace these operations, creating additional revenue opportunities and allowing Vertex to serve a wider customer base.
Market analysts note that North American demand for premium lubricant base stocks is expected to remain strong as vehicle technologies evolve and industrial equipment performance requirements increase. Modern engines and machinery require lubricants capable of operating under more demanding conditions while maintaining efficiency and extending equipment life. As a result, high-quality Group III base oils have become increasingly important in lubricant formulations across automotive, industrial, and commercial applications.
By investing in additional domestic production capacity, Vertex is positioning itself to participate more actively in this growing market segment. The company’s strategy reflects a broader industry shift toward higher-value refined products that can generate stronger margins than traditional transportation fuels alone.
If completed as planned, the Mobile refinery expansion will significantly enhance Vertex Energy’s role in the North American lubricant supply chain. The project is expected to strengthen the company’s competitive position, increase operational flexibility, and create a larger platform for long-term growth.
As development progresses toward the targeted 2029 startup, Vertex aims to establish itself as a leading supplier of both conventional and re-refined Group III base oils, helping meet the evolving needs of lubricant manufacturers while supporting a more resilient domestic supply network for premium base stock production.
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