A local firm has reached agreements with two major oil companies to allow them to use its oil recycling and gas treatment processes.
Interline Resources Corp. and Quaker State's Q Lube subsidiary signed a licensing agreement last Wednesday allowing Q Lube exclusive rights to Interline's used-oil refining process in the United States, Canada and Mexico.The Alpine-based company also signed a three-year deal with Amoco Production Co. to process an estimated 25 million gallons per year of natural gas liquids at Interline's gas treatment and processing facilities in northern Wyoming.
Interline, which employs 70 people in Utah and Wyoming, is engaged in natural gas gathering and processing, oil well production, used oil re-refining and computer-scanning technology development. The company recently moved its re-refining plant from Draper to Sandy.
Under terms of the Quaker State agreement, Q Lube will construct a commercial-size re-refining facility in the Salt Lake area. If successful, additional used oil refining plants will be built in North America. Besides North American operating rights, Q Lube receives options to buy shares in Interline.
Interline uses special solvent to remove water, impurities and additives from oil, making it reusable in asphalt and roofing materials.
Quaker State President and CEO Herbert H. Baum called the agreement an important advance in the development of the company's "cradle to grave" motor oil strategy. "The Interline process permits Q Lube to offer a critical environmental service and help fill an important niche in the lubricants market," he said.
Interline President Michael Williams said the contract offers the company an opportunity to roll out its technology in a timely manner and enhance efforts to recycle used oil in North America.
Financial terms of the Q Lube-Interline agreement were not available Tuesday.
The Amoco contract will generate about $2 million a year in gross revenues for Interline and raise production of its Well Draw plant to 95 percent of capacity, said Larry D. Macfarlane, communications director. The company will treat, fractionate and transport Amoco's natural gas liquids.
The initial treatment will reduce sulfur compounds and carbon dioxide for further processing into commercial propane, mixed butanes and natural gasoline. Interline will transport the treated and finished products between Amoco plants and other destinations, including pipelines and Amoco's markets.
Michael Megee, Interline vice president, said the contract benefits both companies and is Interline's largest since 1990.