Lubricants account for approximately 1% of the annual demand for crude oil, and approximately 50% of lubricants are destined for the automotive industry.  The main cause for lubricant replacement in engines is particulate contamination.  As the engine runs, it produces these contaminants which find their way into the engine oil. Modern engines are equipped with a filter to reduce the contamination and extend oil change intervals, but no such system is perfect, and replacement is still necessary. Ease of particulate contamination is inversely proportional to oil alkalinity, which is a measure of how much of the alkaline buffer initially blended into the oil remains unneutralized.  Once the buffers have been fully neutralized by the acidic oil degradation products (created during ordinary operation of any lubricated combustion engine), particulate contamination increases very rapidly. However, simply replenishing the additives in used oil is sufficient to renew its functionality.  Therefore, it is possible to recycle oil by cleaning contaminants out of waste oil and renewing its additives. The Phillips Re-refined Oil Process (PROP) is a commercial process used to recycle oil in this manner.
PROP consists of two steps: liquid contaminant extraction followed by catalytic treatment with hydrogen to remove remaining nitrogen, oxygen, chlorine, and sulfur-containing compounds not fully removed in the initial step.  The first step is accomplished by mixing and heating the waste oil with an aqueous solution of diammonium phosphate intended to precipitate out metal impurities as solid phosphates, then allowing the oil and water layers to separate and draining off the water layer. The cleaned oil is then subjected to catalytic hydrogen treatment, affording a dried, regenerated base stock oil, to which a manufacturer can then add desired additives to produce a finished product.
My grandfather once told me that motor oil never wore out, it only got dirty. He used to recycle his motor oil in the garage using two containers and a long length of lamp wick. He would place the dirty oil in a container on a high shelf, and then run the lamp wick from the dirty oil in the container down to a clean container on the floor. After wetting the lamp wick with clean oil, the wick would draw the oil down to the floor container via capillary action, but it would not bring particulate matter with it, thus acting as a remarkably effective filter. Of course, this was before additive technology had progressed as far as it has today, so if one were to attempt this with modern oils, replenishing the additives would be necessary. Fortunately for any would-be experimenter, inexpensive (~$5) "oil conditioner" is available, which is a blend of the necessary additives in a volume suitable for a typical oil change. Additionally, diammonium phosphate is a common fertilizer, so one could further remove any acidic products in a manner similar to PROP, however it should be noted again that simply adding more additives is sufficient to restore the oil's properties.
© Marie Maher. The author grants permission to copy, distribute and display this work in unaltered form, with attribution to the author, for noncommercial purposes only. All other rights, including commercial rights, are reserved to the author.
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 R. E. Linnard and G. S. Roush, "Phillips Re-refined Oil Process (PROP) - Quality and Performance," Society of Automotive Engineers, Paper No. 801384, 1 Oct 80.