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Bitumen: A Growing Energy Source in Asia Over the last few years, most countries worldwide have seen a steady increase in the price of fuel oil and natural gas for power generation. Coupled with steep rise in power demand due to manufacturing needs and urban development, the need to source for a practical and cheap alternative fuel (especially in China and India) is a critical factor towards further development. Failure to do so may lead to high inflationary economies or a country’s manufacturing activity may be forced into decline. Bitumen-based emulsion fuel seems to be a viable solution to help avoid these problems. ORIMULSION is the trade name given to the liquid bitumen-based fuel that was designed for industrial power plant boilers use. The technology is developed by Intevep, the research and development affiliate of Petroleos de Venezuela (PDVSA). Natural bitumen extracted is emulsified with water at a 7:3 ratio, with a minute amount (less than 1%) of surfactant added. The resulting product is called Orimulsion. It can be pumped, stored, transported and handled with relative ease. In addition, it can be used in conventional power plants to replace fuel oil with some modifications to meet environmental discharge requirements. Orimulsion has relatively high amount of sulphur content (2.8%) and generate high particulates. Therefore, a Flue Gas Desulphurising system (FGD) has to be installed to remove the sulphur-dioxide from the exhaust flue gas stream. In addition, electrostatic precipitators (ESP) will be required for removal of the particulates produced by the combustion of Orimulsion. As a fuel for electricity generation, Orimulsion has a number of attractive characteristics: • The known reserves of bitumen are very large; • It is currently priced to be competitive with internationally traded coal; • It is easy to ignite and has good combustion characteristics; Annual consumption of Orimulsion amounts to more than 5 million tons in year 2000. Power plants in Canada, Japan, China, Lithuania and Germany have since switched Bitumen sand pit Asphalt is a common bitumen product. 8 <strong>ICA</strong> Volume 1 Issue 1 2007
Energy the fuel source to Orimulsion with positive results. Estimated fuel cost saving of an existing conventional power plant is about 25% (compared to using fuel oil), after necessary modifications to the base unit to meet environmental discharge limits. For fast-developing countries, like China (PRC), energy needs and developments are increasing at very steep rates, so their growth will be dependent on their ability to cope with ever-increasing electrical demands. In order to satisfy such increasing power demand, a country such as China (PRC) will need to import vast amounts of relatively cheap alternative fuel to meet power-generation requirements. Though China has an abundant supply of coal, the extraction rate could not cope with the raising demand and safety of the coal mining industry remain as a major concern. Orimulsion seems to be a viable solution to their energy needs. However, two recent developments have somehow disrupted the production and export of Orimulsion. First, the invasion of US army into Iraq and the subsequent unrest caused the crude oil prices to shoot up beyond US$60 per barrel. It is believed that the selling price of Orimulsion to the Chinese oil firms is approximately US$200 per ton. This makes Orimulsion, which is pegged to the price of coal, extremely attractive, and the Venezuelan suppliers are quickly realising that they are subsidising foreign power generation. Second, the recent internal labour unrest in Venezuela has led to a major strike in PDVSA. Most of the engineers were fired as punishment, and so Orimulsion fell out of favour with the key political leaders. As a result, the government of Venezuela is trying to ‘wind down’ to the Orimulsion programme. In fact, one of the production sites has already been shut, while the other remaining site will likely follow suit by the end of December 2007. Most Orimulsion supply agreement contracts have been terminated, and no new supply contracts of Orimulsion will be signed. The only exception is the continuation of the supply of the emulsion fuel to two of China’s (PRC) oil firms. This is due to the strong political ties among China, Cuba, and Venezuela. The government of Venezuela explains their abrupt action by indicating that the reserved used for Orimulsion production is actually identified as ‘extra-heavy crude oil’, not bitumen. Hence, it is not deemed a ‘precious reserve’. In the coming years, it is not expected that the use of Orimulsion in Asia will re-surface, unless there will be moderate adjustment to the pricing of the bitumen-based emulsion fuel and the labour relationship between PDVSA and the government has improved. Multiphase Superfine Atomised Residue (MSAR) MSAR is a new stable oil-in-water emulsion fuel system developed by Akzo Nobel Surface Chemistry AB of Sweden. MSAR has only less than two years of marketing history, and it is not clear if there are confirmed customers outside Canada yet. This product is protected by license agreements and patents held by Akzo Nobel and Colt Technologies Inc. of Canada. Quadrise Canada has the exclusive rights for the use of MSAR emulsion fuel technology in Canada. The composition, stability and burning efficiency of MSAR are very similar to that of Orimulsion. Both are expected to be practical and cost-effective alternative fuels based on bitumen to replace fuel oil and natural gas. Both required FGD facilities to remove the sulphur oxides formed when burning. However, MSAR technology offers two major differences of production and operation aspects compared to Orimulsion. Two advantages of using MSAR over Orimulsion include: • The fuel can be customised from various feed stock, ranging from bitumen to heavy hydrocarbons, offering an ideal disposal method for refinery heavy residue. • It is manufactured on site, thereby avoiding transportation risks involved in shipping the emulsion fuel to end users’ locations. Basically the MSAR process involved setting up a compact production module at customers’ site to generate the emulsion fuel via mixing local bitumen feed, water and Petroleum distillation towers surfactant. The product can then be stored away for power generation later. In the MSAR process, the heavy oil residue / bitumen particles are milled to approximately 3 - 5 microns in diameter. This is somewhat smaller than the typical atomised droplets of 50 microns in fuel oil. It is also smaller to those produced in Orimulsion technology. Currently, Quadrise Canada is marketing MSAR with an added advantage to potential customers, and identifying security in supply is a consideration that must be pondered when selecting bitumen-based emulsion fuels. While this new option of bitumen-based fuels may not solve the availability of energysource problems, it does look attractive for countries that operate huge refineries and already have experience handling heavy residue and also have on-site FGD facilities. It is no surprise that two state-owned refineries in India are believed to be interested in such a model to reduce fuel cost. For the smaller power stations, this technology may prove to offer no advantages due to the lack of adequate economical supply of bitumen/ heavy residue, or the savings may not be attractive compared to the required initial capital investment. Summary Orimulsion production and sales to China and Japan was gaining very strong momentum in since early 2000. However, this program was halted abruptly elsewhere, and China is currently the only customer that will have the supply agreement contract honoured till end 2007. The continued supply of Orimulsion looks unlikely unless the price is adjusted to reflect its true value currently. MSAR is another option for big refineries in Asia. It is manufactured on-site and does not have as many supply or transportation problems and restrictions. However, this technology is costly at initial stages as a process hardware unit (capital investment) is required to be installed before benefits can be realised. Indian refineries are keen on taking up such options because of the advantage via economy-of-scale. The use of bitumen as alternate energy source in Asia has begun, and its usage will definitely grow as it provides an option to fight increasing fuel costs. As it turns out, the most-likely users willing to make the switch are also the biggest fuel consumers. ❏ This article was submitted by Mr. Goh Hong Hoo, Senior Lecturer, Nangyang Polytechnic, School of Chemical and Life Sciences who is an expert in bitumen and petroleum-related products. A Bit About Bitumen NATURAL Bitumen is a mixture of organic liquids that consists of very large hydrocarbon molecules, mainly comprising of multiple cyclic aromatics. It is black, highly viscous and sticky. In other words, it is basically thick oil that does not flow at moderate temperatures or cannot be pumped without being heated or diluted. Many geologists believe that the natural bitumen deposits are formed from the remains of ancient, microscopic algae and other prehistoric once-living plants. These organisms died, and their remains were deposited in the mud on the bottom of oceans or lakes where they once thrived. Under the pressure and heat of burial deep in the earth, the remains were transformed over time into crude petroleum materials and bitumen. Geographically, bitumen is found throughout the world. The greatest potential resources are identified mainly in Venezuela, Canada and Russia. However, the actual available sources could be much larger. It is believed that many possible bitumen deposit occurring locations are not documented, unless they can meet economical extraction/market conditions. Hence, it will not be a surprise if more bitumen / heavy oils reserves are declared later. The bitumen deposits in Orinoco Oil Belt, a part of the Eastern Venezuela basin, represent nearly 50% of the world documented and extractable bitumen reserves at 1.2 trillion barrels. In Alberta, Canada natural bitumen deposits represent up to about 35% of the world reserves. Logically, these two countries have the most active research programmes to extract bitumen, and they also to make full use of their reserves potential. Bitumen is primarily used for paving roads. Other conventional uses include general waterproofing products (including boats), roofing felt and for sealing flat roofs. Bitumen emulsions are two-phase systems consisting of bitumen, water and one or more additives to assist in the formation and stabilisation of the emulsion. Such emulsions help to avoid the requirement of heating since they are ready to use products. As a result, there is less atmosphere pollution and less heating energy used for laying and maintenance of roads. Recent technological development also allow bitumen emulsions to be used as a commercial boiler fuel in power plants in Canada, China, Japan and Germany. Such bitumen-based fuel is formed via mixing bitumen with fresh water and an alcohol-based surfactant. The resulting mixture has properties very similar to the conventional fuel oil or natural gas, thus making it easier to be transported and combusting fully in air. Raw bitumen has proportionally more carbon atoms than hydrogen atoms. Elemental analysis of bitumen shows that most contain 82 to 88% Carbon; 8 to 11% hydrogen; 1 to 6% sulphur and 0 to 2 % of oxygen and nitrogen. This heavy carbon weightage property makes bitumen having a tendency to generate heavy particulates in the effluent when burned. Bitumen may be waxy, and also contains several heavy metals such as vanadium, nickel, chromium, mercury, lead and arsenic, selenium and other toxic elements. It is whole soluble in carbon disulfide. The chemical composition of bitumen is extremely complex. A complete analysis of bitumen would be very laborious and also impractical, if not possible. In general, however, it is possible to separate bitumen into saturates, aromatics and resins. Bitumen is also produced in bottom-residue fraction of the fractional distillation of crude oil in the refineries. It appears as the heaviest fraction and with the highest boiling point. From the properties described above, it is not difficult to imagine that there will be an array of problems compared to other petroleum-based energy sources with respect to exploitation, transportation, storage and refining of bitumen. This is reflected in the relatively high cost involved in extraction and processing bitumen, as well as the physical limitations of production capacity. ❏ <strong>ICA</strong> Volume 1 Issue 1 2007 9
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