2_SK Handa.pdf - World Petroleum Council

Heavy Crude ProcessingSK HandaEngineers India Limitedwww.engineersindia.comInternational Conference on‘Refining Challenges & Way Forward’16-17 April, 2012

Challenges Facing Refinery• Process heavy, high sulphur cheaper feedstocks• Bottom of the barrel processing to improve margins• Improve fuels quality to meet new specifications• Reduce emissions to meet environmental norms• Flexibility to meet changing market demands• Processing of unconventional feedstocks• Reduction in CO2 emissionswww.engineersindia.com

Regional Crude Oil ProductionIncreasing• Middle East• CIS• Africa• CanadaFlat• United States• Latin America• AsiaDeclining• Europewww.engineersindia.com

Heavy Sour Crude ProductionObservations : Total heavy sour crudeproduction is expected toreach 700 MMTPA (14million B/D) by Yr. 2020, anincrease of over 2.5 MMB/D over year 2010production. The largest increases willcome from the Middle East& Canada.www.engineersindia.com

Growing Energy DemandMost countries rely on few energy producing nations that controlabundant hydrocarbon reserves.• Current global oil production is about 82 MMbpsd, 75% of it isconventional crude oil.• Total estimated reserves of conventional oil of top 17 producers is 1.2trillion bbls.• At the current oil production rate, the balance life of the conventionalcrude oil reserves is nearly 54 years.Looking forward to Yr 2030, forecast global oil demand is estimated toreach 116 MM bpsd.www.engineersindia.com

How to Meet Growing Energy Demand Curb demand on consumer side Increase supply of raw oil. This requires :• Exploitation of unconventional oil reserves• Advanced processing technology• New innovations for renewable fuelswww.engineersindia.com

Have We Reached Peak Oil Global oil production in recent past was largely focused on maximising‘Easy Oil’. This focus has already shifted to unconventional oils. World oil reserves have already started becoming –• Sour• Heavier• More acidic• Harder to produce or recover Deteriorating crude quality requires –• Increased production cost• Needs enhanced oil recovery methods• Increased processing costThe available statistical data of the crude oil reserves shows that conventionaloil production is already past its peak.www.engineersindia.com

Year–vise Oil Production in Non-OPEC & FSU Countries

Path ForwardAfter the peak conventional oil production this century,the refineries are required to necessarily & increasinglyincorporate unconventional feedstock processingtechnologies around a core of existing conventional oilrefining assets.www.engineersindia.com

Conventional & Un-conventional Oil Reserves• Current share of unconventionalsources in the total output isabout 25%. This is expected torise to 40% of global oil supplyby the year 2015.• Unconventional oil reserves areestimated to be about 6 trillionbarrels .• Conventional oil reserves areestimated to be 1.2 trillionbarrels.www.engineersindia.com

Unconventional Oils - Heavy Oil & Oil Sands BitumenLocation Crude Type Estimated ReservesAlberta (Canada) Bituminous 85% of world’s recoverablebitumen reservesOrinoco Belt (Venezuela) Extra-Heavy 90% of world’s extra heavyreserveswww.engineersindia.com

Rajasthan Crude Characteristics ComparisonPropertyRajasthan CrudeArab Mix Crude(50:50 by wt.)Bombay HighCrudeAPI 27.06 30.77 39.2Sulphur, wt% 0.34 2.37 0.142Total Acid Number (TAN), mgKOH/g0.49 < 0.2 0.107Pour Point, Deg C (+)48 (-) 15 (+)7.2CCR, wt% 8.65 6.0 0.968Ni+V, ppmw 10.7 48 2.1Wax Content, wt% 25.8 2.8 10.6www.engineersindia.com

Yield (wt%)Rajasthan Crude Product Yield Comparison12010080604020030.9144.1417.376.3271.23922.0626.1518.5112.271.9819.411.63RAJASTHAN ARAB MIX BOMBAYHIGH196.51 VACRESIDUE23.91VGO22.22626.31DIESELKEROSENENAPHTHALPGC1-C2Yield(Wt%)RajasthanCrudeAMBHRCO 73.3 48.8 30.4VGO 43.8 26.2 23.9VR 29.5 22.6 6.5www.engineersindia.com

Heavy Oil & Oil Sands Bitumen PropertiesProperty Heavy Oil BitumenDensity, 0 API 20 ~ 22 7 ~ 19Density, Kg/M3 920 ~ 950 > 1000Sulphur, wt% 3 ~ 4.5 > 4Viscosity, cP > 30,000 > 100,000 @ 25 0 CNew innovative technologies are needed to upgrade the extra-heavy oil /bitumen feedstocks.www.engineersindia.com

Heavy Crude QualityProperty Comment ImpactAPITypically, oil gravity approaches water, requiringa diluents to separate water from hydrocarbonWater / OilseparationSulphur High sulphur levels requiring hydrotreatment CorrosionNitrogenHigh nitrogen levels requiring H2 for removal,producing NH3Metals Ni/V/Fe High catalyst replacementMetalsNa/Ca/AsAlkaline metals, special guard bed / catalystsfor removalCorrosionCatalystdeactivationCorrosion / catalystdeactivationAsphaltenesPotential for fouling, may cause frequentmaintenance shutdownFoulingNaphthenicacidsHigh levels will cause corrosionCorrosion / foulingChlorides Typically associated with alkaline metal CorrosionViscosity Too high to pump; requires diluentsHigh transportation/ pumping costwww.engineersindia.com

Technology Options for Heavy & Bituminous Crude Processing• Blending with light crude oil‣ Light crude required for blending is in short supply‣ Limited application in processing large volumes of heavy oil‣ Cannot be applied to bituminous crudes without prior upgrading• Upgrading for integrating as refinery feed‣ Upgraders remove contaminants, produce high-value, light sweet syntheticcrude oil (SCO)‣ Upgrader can be On-site or Off-site based on location relative to productionfacility‣ Synergy of upgrader with upstream production facility or downstreamrefining facility is specific to each casewww.engineersindia.com

Processing Steps for Upgrading Heavy Oil / BitumensDiluent RecycleUpgraderLight sweet SCOOn-site or Off-siteMining orIn-SituExtra-HeavyOil / BitumenBlend AssayBlendingHeavy crude oilwww.engineersindia.com

Primary Upgrading Process SelectionDelayed Coking• Offers low liquid product yielddue to 25~35% coke make & ~10% gas make.• Products have high aromaticcontent, not suitable for FCCfeedstock.• Not favorable fromenvironmental considerations.• Coke disposal by gasification.SDA & Hydroconversion• Super critical solvent extractiongets high DAO yield (70~80%).• DAO is of high quality achievedby selectively removing solidasphaltenes.• Without SDA, hydroconversionmay suffer from shorter cyclelength caused by catalyst fouling.• Pitch disposal by gasification.Delayed coking is not an idealoption for upgrading heavy /bituminous feedstocks though itrequires lower capital investment.SDA combined withHydroconversion can producehigher liquid volume of betterquality Syncrude but the capitalcost is higher.www.engineersindia.com

Diluent RecycleOnsite Upgrading with SDA & HydroconversionLight sweet SCOLPGDistillatesHydroconversionSour gasSulfurRecoveryFuel GasSulphurDAOHydrogenDiluentRecoveryVacuumDistillationSour GasHeavy Feed CentralProcessing FacilityVTRSteam for SAGDSolventDeasphaltingAsphaltAsphaltGasificationSyngasSyngas Treating& ConditioningHvy Oil from WellSyngas for SAGD FuelAirSeparationOxygen

Offsite Upgrading with SDA & HydroconversionLight sweet SCOLPGDiluent RecycleDistillatesDAOHydroconversionSour gasSulfurRecoveryFuel GasSulphurHydrogenDiluentRecoveryVacuumDistillationSour GasDiluted Hvy OilVTRSolventDeasphaltingAsphaltAsphaltGasificationSyngasSyngas Treating& ConditioningAirSeparationOxygenGasTurbineSteam/Power

Syn Crude Oil – Economic Data• The estimated development cost of a grassroots project in Albertasands with production capacity of 100,000 bpsd of bitumen &Syncrude oil quality of 36 0 API is : 21 $/bbl over a 20 year project life• Based on existing operating cost of Orinoco belt, the unitdevelopment cost for Syncrude oil quality of 32 0 API is : 10 $/bbl over a 20 year project life• Canadian Syncrude is a traded commodity.• Syn crude is priced about 2~3$/bbl lower than low sulphurbenchmark crudes.www.engineersindia.com

Product Result of Hydroconversion Processing of Heavy OilProperty Bitumen Feed Syncrude ProductAPI gravity 17.5 35.0Sp. Gravity 0.9497 0.8498S, wt% 1.22 < 0.1N, wt% 0.3 0.13Metals, wppm 77 < 1.5CCR, wt% 7.4 < 1535+ 0 C, wt% 41.7 5.0Typical Syn Crude Product YieldsNaphtha Kero Diesel VGO VRYield, wt% 20.2 30.9 16.5 27.5 5.0www.engineersindia.com

Syn Crude Processing – Impact on Refinery OperationSyncrudeTypeProcessing ImplicationsSweethydrotreatedsyncrudeSoursyncrudeHigher percentage of VGO in syncrude require more secondary processingcapacityFCC conversion & gasoline yields are expected to be lower‘Difficult to remove’ sulphur & nitrogen species makes ULSD productiondifficult.Kero smoke point not met due to high aromatics.Production of LOBS by conventional route not possible due to aromatic natureof synthetic VGOSyncrudes do not have resid, hence no increase in resid conversion capacity /under utilised resid processing units.All the Benefits & limitations of sweet hydrotreated syncrude apply in thiscase.Severe hydrotreating required to make FCC feed of required quality or toproduce ULSDAdditional sulphur plant capacity requiredMetallurgy upgrades may be required to handle these crudes

Potential Gasification Feeds & ProductsNatural GasCO 2 , N 2 , SSteamRefinery GasVacuum ResidueCombined CycleElectricPowerPitchCoalPet CokeBio Masswww.engineersindia.comGasificationPlantSlag for ConstructionMaterial & MetalRecoveryChemicalsProductionFischer TropschReaction• H2• CO• Fertiliser• Chemicals• Methanol• Acetic Acid• Naphtha• Jet• Diesel• Wax

Conclusions• Conventional crude oils are fast depleting, have limited residuallife.• Proven reserves of unconventional oil are going to replaceconventional oils to maintain the energy demand of the world.• Commercial exploitation of Unconventional oils is expected to helpin stabilising crude oil prices besides providing diversity to thecrude supply sources.• Upgradation of existing refineries is necessary to handle thefeedstocks of the future.www.engineersindia.com

Thank youEngineers India Limited- Delivering excellence through people