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Refining & Petrochemicals Integration Business Drivers & Enabling Technologies

Refining & Petrochemicals Integration Business Drivers & Enabling Technologies. Refining & Petrochemicals Integration Business Drivers & Enabling Technologies. Refining & petrochemicals markets Investment strategies Enabling technologies Concluding remarks. UOP 4698-02. Refining Situation.

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Refining & Petrochemicals Integration Business Drivers & Enabling Technologies

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  1. Refining & PetrochemicalsIntegrationBusiness Drivers & Enabling Technologies

  2. Refining & Petrochemicals IntegrationBusiness Drivers & Enabling Technologies • Refining & petrochemicals markets • Investment strategies • Enabling technologies • Concluding remarks UOP 4698-02

  3. Refining Situation Investment “threshold” • Refining utilisation significantly higher in 2004 - 06 • Margins currently above re-investment “threshold” Refining investments potentially attractive UOP 4698-03

  4. Refining Investment Imperative • ~ 1.5 Mb / d incremental refined fuels annually • ~ 45% in M. East + China • Clean transport fuel growth • Refining investments essential • Capacity • Conversion • Upgrading $30 – 40 billion per year Substantial investments essential UOP 4698-04

  5. Investment Remuneration • Escalating fabrication and construction costs affecting investment returns New 200 kb/d Cracking refinery ~ $6+/bbl average marginfor 20+ years required $4bn investment 10% Internal Rateof Return Investment Risk Remains Challenging UOP 4698-05

  6. Leading-Edge Technology Risk Mitigation • Feedstock and product flexibility • “Opportunity” feedstocks • Optimal upgrading & conversion • Maximize value addition • Prosper from cyclical markets • Operational efficiency • Economies of scale • Energy • Control & optimization Flexibility, Efficiency, Integration UOP 4698-06

  7. Advantages Of Integration • Integrated refinery and petrochemical operations minimize costs and optimize product distribution • Optimized integration of hydrocarbon processes, energy, hydrogen, and water • Feedstock flexibility to capitalize on available low cost crude oils and intermediates • Supply chain optimization provides faster delivery of products UOP 4698-07

  8. Petrochemicals p-X Styrene Benzene PP o-X Propylene Fuels Ethylene J / K Diesel Gasoline Fuel Oil Petrochemicals Can Add Significant Value Adding Value to Crude 1200 1000 900 800 700 600 Crude $ per Ton 500 400 300 200 100 0 UOP 4698-08

  9. Aromatics Markets Annual Growth 6.8% 3.6% Sources: CMAI & UOP Strong Aromatics & Derivatives Growth UOP 4698-09

  10. p-Xylene Capacity & Demand(Committed Projects Only) • Refineries are main source of xylenes supply • Future p-X demand growth expected to average 1.8M MTA/Yr Sources: PCI & UOP Future supply deficit 3 To 4 World Scale p-X Complexes Annually UOP 4698-10

  11. ~ 18 M MTA 2004 2006 2008 2010 2012 2014 Propylene Market MT Propylene / MT Ethylene 0.45 0.64 0.62 Propylene demand increasing faster than supply from conventional sources Demand 0.59 SteamCrackerProduction Demand Supply from steam crackers 0.40 0.36 Source: CMAI 2005 0.35 0.54 Growing Demand For “On-Purpose” Propylene UOP 4698-11

  12. + Petrochemicals Refining BTX & Olefins: Integration Potential • Strong growth potential • Attractive value addition • Assured feedstock supply • Potential for low cost & “distressed” refinery intermediates • High value return streams to refinery, e.g., hydrogen, high octane gasoline Potential To Raise Returns & Mitigate Risk UOP 4698-12

  13. Light Olefins Naphtha Refinery Reformate BTX Crude Oil Kerosene Detergents • FCC Intermediates • LPG • Cracked Naphtha • Light Cycle Oil Chemicals Hydrogen Residues Power Integration Strategies Technology Provides Link UOP 4698-13

  14. Light Olefins BTX Detergents Chemicals Hydrogen Power Integration Strategies Naphtha Refinery Reformate Crude Oil Kerosene • FCC Intermediates • LPG • Cracked Naphtha • Light Cycle Oil Residues Technology Provides Link UOP 4698-14

  15. C2= Olefin Cracking Lt. Olefin Recovery Lt. Olefin Recovery LPG C3= AGO / VGO FCC Gasoline FCC Fuel oil Refinery – Light Olefins Integration Propylene Recovery C3= AGO / VGO Gasoline FCC Fuel oil Olefin Cracking: Developed by Total Petrochemicals & UOP Doubles Propylene Production & Reduces C4/C5 Olefins UOP 4698-15

  16. Olefin Cracking EnhancesGas To Olefins Gas Ethylene & Propylene UOP / Hydro MTO Process Methanol Synthesis Olefin Cracking • 20% increase in light olefin yields • Nearly 80% reduction in C4+ by-products • 2:1 propylene/ethylene production ratio UOP 4698-16

  17. Light Olefins PetroFCC Process Traditional FCC 6 C2= C2- 3 9 6.5 C3’s 22 C3= 11 24 C4’s C4= 14 19 53.5 Naphtha Aromatics 28 BTX 18 Distillate 14 9.5 Fuel Oil 7 5 Coke 5 5.5 PetroFCCTM Process: BTX + Olefins The “Petrochemicals Refinery” Enabler UOP 4698-17

  18. Aromatics Processing Benzene Naphtha Sulfolane™process BT Fractionation Tatoray™ process CCR Platforming™ process Xylene Fractionation Isomar™ process Parex™ process Conversion Ring Adjustment p-Xylene Separation • Proven performance track record • State of the art technology – continuous innovation • Cost effective designs; high on-stream efficiency 90% of p-X capacity since 1970 uses Parex process UOP 4585C-11 UOP 4698-18

  19. BTX Innovation: LCO-XTM Process • FCC light cycle oil (LCO) • Distillate range intermediate product • High sulfur, high density, highly aromatic • Difficult to blend to clean transport fuel • High content of multi-ring aromatics • Unlock benzene and xylenes Low value as fuel blendstock Low cost, high value BTX feedstock • LCO-X process for converting LCO to BTX recently announced $0.75/Bbl crude increase in operating margin UOP 4698-19

  20. A Future Scenario TransportationFuels CrudeOil Refining O2, N2, CO2, S, sulfuric acid Naphtha Diesel Jet fuel Wax Gas Conversion Separation Resid Resid Gasification Hydrogen Carbon monoxide Fertilizer SNG Olefins Methanol/Ethanol Acetic acid Reforming Natural Gas Chemicals Syn Gas Production Hydrogen Power Electricity Electricity Technology Developments Key To Deeper Integration UOP 4698-20

  21. uop A Honeywell Company Innovation, Research, Development • UOP Awarded National Medal of Technology in 2005 “…over 85 years of sustained technical leadership and innovation for the worldwide petroleum refining and petrochemical industries……benefited quality of life throughout the world.” Ref: National Medal of Technology Award to UOP, 2005 Universities • Broaden the knowledge base • Leverage academic and industrial experts • Keys to success: • Collaboration / alliances • Commercialize Customers Government Labs Suppliers Startups Technology Leaders Technology Imperative – A Key Enabler UOP 4698-21

  22. Summary • Strong growth of refining and petrochemicals markets, healthy margins • Investment in additional capacity essential • Integrating petrochemicals with refining can mitigate investment risk • Continuing technology innovation key enabler for successful integration UOP 4698-22

  23. Thank You UOP 4698-23

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