Re Sustainability and Indian Oil Partner to Launch India’s First Integrated Used Oil Circular Economy

Hyderabad: In a major step toward environmental sustainability, Re Sustainability and Indian Oil Corporation Limited (IOCL) signed a Memorandum of Understanding (MoU) on March 12, 2026, to establish India’s first structured national ecosystem for the collection and recycling of used lubricating oil. This collaboration aims to formalize the recovery of used lubricants, transitioning India toward a more resource-efficient and low-carbon economy.

The partnership involves the creation of a Special Purpose Vehicle (SPV) to manage a nationwide reverse logistics network. This system will aggregate used oil from the automotive and industrial sectors, which will then be processed in advanced refining facilities to produce Group I and Group II+ Re-Refined Base Oil (RRBO). By reintroducing these refined oils into the lubricant manufacturing chain, the initiative reduces the country’s dependence on virgin crude-derived base oils and saves significant foreign exchange.

National Infrastructure and Capacity
The initiative targets an annual collection of up to 100 kilotonnes (KTA) of used lubricating oil. To support this, the partners plan to establish a state-of-the-art re-refining facility within the next three years. This facility will be designed to meet both Bureau of Indian Standards (BIS) and international specifications.

Beyond oil recovery, the partnership also addresses plastic waste. The project includes the recycling of plastic lubricant containers, helping the companies meet Extended Producer Responsibility (EPR) requirements and ensuring the responsible lifecycle management of packaging materials.

Addressing the Formal Recycling Gap
Currently, India generates approximately 1.3 million tonnes of used lubricating oil every year, but only 0.2 million tonnes are recovered through formal channels. Mr. Masood Mallick, Managing Director & Group CEO of Re Sustainability, noted that this partnership marks a transformative step in institutionalizing structured oil recycling, moving from mere waste management to high-value resource recovery.

Mr. Bankim Patra, Country Head (Lubes) at Indian Oil, emphasized that formalizing this sector strengthens India’s energy security while fulfilling environmental responsibilities. The project is expected to be a scalable model for circular recycling across the nation.