Gulfpub Hp 201106

RENTECH breaks new trails in the boiler industry with its focus on custom engineering and design.

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www.HydrocarbonProcessing.com

JUNE 2011

HPIMPACT SPECIALREPORT TECHNOLOGY

PROCESS/PLANT PROCESS/PLANT OPTIMIZATIONOPTIMIZATION

Maintenance, Maintenance, operationsoperations and engineering areand engineering areall involved in better all involved in better plant performanceplant performance

Refining margins Refining margins under pressureunder pressure

Positive PVC demandPositive PVC demand

Update on lubrication Update on lubrication systemssystems

Improve energy Improve energy efficiencyefficiency in hydrotreatersin hydrotreaters

Reliability has no quitting time.

Think about ITT.

Conofl ow | Enidine | Fabri-Valve | Fiberbond | Goulds | ITT Standard | Midland-ACS | Neo-Dyn

In oil and gas facilities around the world, ITT delivers pumps, valves, composite piping, switches, regulators and vibration isolation systems that can handle harsh conditions and keep going. After all, in the 24/7/365 refi nery business, the last thing you want is a piece of equipment that fails. With ITT, your processes stay upand your total cost of ownership stays down. For more information, and to receive our Oil and Gas catalog, visit www.ittoilgas.com or call 1-800-734-7867.

Select 86 at www.HydrocarbonProcessing.com/RS


JUNE 2011 VOL. 90 NO. 6

SPECIAL REPORT: PLANT/PROCESS OPTIMIZATION

35 Why technology choice does matter B. Harkins 37 Pump rebuilding by expert non-OEMs is effectiveCommunication and competence are key in finding the best repair shop for major equipment

H. P. Bloch and B. Bluse

41 Put training back into operator training simulatorsThis five-step approach is low-cost and offers safer learning experiences D. C. Glaser

45 Update your reliability performance to meet process safety expectations Better risk assessment can identify root causes for potential catastrophes before they occur

K. Bloch, J. Bertsch and D. Dunmire

55 Rethink planning and schedulings role in refinery optimizationNew tools improve prediction of unit feed qualities and yieldsM. Swensen and C. Acuff

61 Consider closedloop oil-mist lubricationA growing trend is migrating to this new lubricating system for rotating equipmentD. Ehlert

67 Improve energy efficiency for distillate hydrotreaters retrofit optionsEnergy conservation is a complex analysis on existing units, but benefits are possibleZ. Milosevic and T. Shire

73 Fine-tune ethylene unit startupsAdvanced modeling methods provide useful information on operating main compressor system and feedsX. Yang, Q. Xu and K. Li

95 Use advanced process control to add value for your facilityOptimization programs deliver benefits to existing and new plantsR. Di Nello

101 Optimize design for distillation feedUse these steps for enhanced performanceS. H. Lee and M. J. Binkley

Cover China Blue Chemical Co. Ltd.s 2,500- metric tpd methanol plant is located at Dongfang on the west coast of Hainan Island near the port of Bausuo in the South China Sea. The facility completed successful start and performance testing in March 2011. This facility will produce chemical-grade methanol to supply both the domestic Chinese market along with product available for export. The feedstock is natural gas from the China National Offshore Oil Corp.s (CNOOCs) offshore wells. China Blue is a subsidiary of CNOOC. The plant utilizes DPTs catalytic-rich gas pre-reforming technology and a DPT steam reformer for synthesis gas production and Johnson Matthey Catalysts low-pressure methanol technology featuring DPTs proprietary steam raising converters. The plant is 1 of 13 plants that Davy Process Technology and Johnson Matthey Catalysts have licensed, globally over the past five years. Photo courtesy of Davy Process Technology.

HPIMPACT15 Refining margins under pressure to 2015

15 US PVC producers see healthy exports

17 Oil and gas supports two million jobs in Texas

COLUMNS11 HPIN RELIABILITY

How do you size expansion chambers (assuming it is needed)

13 HPINTEGRATION STRATEGIESKorean ethylene plant reaps benefits from APC

110 HPIN AUTOMATION SAFETYIs it possible to communicate risk issues successfully?

VALVES 2011SUPPLEMENT 79 Valves 2011 Update on valve technology for processing/refining facilities DEPARTMENTS 9 HPIN BRIEF 19 HPINNOVATIONS 25 HPIN CONSTRUCTION 32 HPI CONSTRUCTION BOXSCORE UPDATE 106 HPI MARKETPLACE 109 ADVERTISER INDEX

4

EDITORIAL Editor Stephany RomanowProcess Editor Tricia CrosseyReliability/Equipment Editor Heinz P. BlochTechnical Editor Billy ThinnesOnline Editor Ben DuBose

Associate Editor Helen MecheEuropean Editor Tim Lloyd WrightContributing Editor Loraine A. HuchlerContributing Editor William M. GobleContributing Editor Y. Zak FriedmanContributing Editor ARC Advisory Group

MAGAZINE PRODUCTIONDirectorProduction and Operations Sheryl StoneManager Editorial Production Angela BatheArtist/Illustrator David WeeksManagerAdvertising Production Cheryl Willis

ADVERTISING SALESSee Sales Offices page 108.

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Because Hydrocarbon Processing is edited spe-cifically to be of greatest value to people work-ing in this specialized business, subscriptions are restricted to those engaged in the hydro-carbon processing industry, or service and sup-ply company personnel connected thereto.

Hydrocarbon Processing is indexed by Applied Science & Tech nology Index, by Chemical Abstracts and by Engineering Index Inc. Microfilm copies available through University Microfilms, International, Ann Arbor, Mich. The full text of Hydrocarbon Processing is also available in electronic versions of the Business Periodicals Index.

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HYDROCARBON PROCESSING (ISSN 0018-8190) is published monthly by Gulf Publishing Co., 2 Greenway Plaza, Suite 1020, Houston, Texas 77046. Periodicals postage paid at Houston, Texas, and at additional mailing office. POSTMASTER: Send address changes to Hydrocarbon Processing, P.O. Box 2608, Houston, Texas 77252.

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GULF PUBLISHING COMPANYJohn Royall, President/CEORon Higgins, Vice President

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Other energy group titles include:World Oil

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IRPCASIA: The Conference for theGlobal Refining and Petrochemical IndustryOn 1921 July 2011 Hydrocarbon Processing will host the 2nd Annual International Refi ning & Petrochemical ConferenceAsia. Strategically located in the heart of Southeast Asias refi ning and petrochemical industry, and with easy access from all major refi ning and petrochemical centers, Singapore is home to IRPC for 2011. IRPCAsia will bring together many of the worlds leading experts in refi ning and petrochemical technologies. Like Hydrocarbon Processing, the two-day, two-track conference and exhibition will focus on presenting leading-edge technology, best practices and solutions for the global hydrocarbon processing industry.

Silver Sponsor:

For sponsorship and exhibit information, contact your local sales rep or:Bill Wageneck, Publisher for Gulf Publishing Company

Phone: +1 (713) 529-4301 / Email: [email protected]

For registration and lodging information, contact:Gwen Hood, Events Manager for Gulf Publishing Company

Phone: +1 (713) 520-4402 / Email: [email protected]

John BaricLicensing Technology ManagerShell Global Solutions International B.V.

Eric BenazziMarketing DirectorAxens

Carlos CabreraPresident & CEONICE

Dr. Charles CameronHead of Research & TechnologyBP plc

Antonio Di PasqualeVice President, Refi ning Product LineTechnip

Giacomo FossataroTechnical and Operation ManagerWalter Tosto S.p.A.

Dr. Madhukar O. GargDirectorIndian Institute of Petroleum in Dehradun

Andrea GragnaniDirector, Refi ning Product LineTechnip

Dr. Syamal PoddarDirectorPoddar & Associates

James RichardsonDirector of Southeast AsiaSd Chemie

Giacomo RispoliSenior Vice President, Research & Development eniRefi ning & Marketing Division

Stephany RomanowEditorHydrocarbon Processing

Michael StockleChief EngineerRefi ning TechnologyFoster Wheeler

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I have someone retiring after 33 years on the job.I have someone taking 33 years of experience with him.And now someone with just 3 years has to do that job.

The Emerson logo is a trademark and a service mark of Emerson Electric Co. 2011 Emerson Electric Co.

With new Human Centered Design technologies from Emerson, its like the experience never left. Using our deep insights into how your people perform their roles and tasks, Emerson is designing all of our new products based on the science of Human Centered Design. This lets us embed the same experience and understanding thats walking through your plant into our control and monitoring technologies making them the easiest and most intuitive to use. Tasks are accomplished in fewer steps, and with greater confidence, even when relying on less expertise and specialization. Its the certainty that jobs are done right, no matter whos doing them. Find the experience youve been missing at EmersonProcess.com/Experience

HYDROCARBON PROCESSING JUNE 2011 I 9

According to the US Energy Infor-mation Administration, the total of more than 22.1 trillion cubic feet of natural gas demand in 2010 was the highest-ever level in the US, exceeding the previous high point established in 2000 by more than 10%.

With 2010 setting new records for natural gas demand, Gas Technology Institute (GTI)an independent, not-for-profit R&D organization serving the natural gas industrysees the coming decade as a period of contin-ued robust growth.

The economic and clean-energy benefits of natural gas are helping to drive market demand, said David Carroll, president and CEO of GTI. The outlook for natural gas demand remains robust, thanks to the remark-able expansion of natural gas supplies in recent years and very attractive end-user prices. We believe that gas demand will likely reach 2426 trillion cubic feet by 2020, while also helping to reduce US carbon emissions.

Future growth in demand will be led by the power-generation sector, where natural gas is poised to help offset an expected wave of older coal-fired power-plant retirements. Power-generation demand in 2010 was at an all-time high, 40% higher than demand in 2000.

The natural gas industry is also experiencing growth in residential and commercial market sectors. In 2010, residential natural gas demand was the highest since 2003, while commercial customers used more gas than at any time since 1997. While muted by appliance and building energy-efficiency improvements, nat-ural gas is well positioned to continue to efficiently meet building energy needs as an environmentally friendly energy source.

Another area in which GTI antici-pates major growth in demand is in the transportation sector, where fleet own-ers are increasingly turning their atten-tion to natural gas vehicles (NGVs) for their economic benefits. Current prices of compressed natural gas for vehicle use are about $1.95/gallon. HP

[email protected]

BILLY THINNES, TECHNICAL EDITOR

HPIN BRIEF

ConocoPhillips CEO Jim Mulva appeared at a Senate Finance Committee hearing in Washington, DC, where he outlined the negative effects of proposed tax policy legislation targeting major energy companies. Other companies with CEOs testifying were BP, Shell, Chevron, ConocoPhillips and ExxonMobil. The bill, proposed by several Democratic US Senate members, would repeal tax breaks for the five largest oil companies, saving US taxpayers approximately $2 billion a year.

Our industry already has the highest effective tax rate in the US, said Mr. Mulva. Increasing these taxes would cost jobs and raise gasoline and other consumer prices, while actually unintentionally reducing the governments tax revenue by discouraging investment by the industrys largest and most financially capable companies.

According to Mr. Mulva, proposals to repeal the Section 199 domestic manufactur-ing deduction for the five largest oil companies would discriminatorily deny them a tax deduction available to every other manufacturing industry.

Statoil will withdraw from ownership and management roles with gas-to-liquids venture company GTL.F1. The Norwegian oil and gas major said it had played a key role in developing GTL.F1s technology, but, being primarily a user of technology in its own operations, Statoil does not see licensing of GTL technology as part of its core business. As a result, Statoils further partnership is no longer essential for continuing success, the venture firm said. Statoil will have access to the GTL.F1 technology on a preferential commercial basis.

Albemarle has developed a proprietary technology for lithium extraction from brine. This newly developed technology will allow the company to recover lithium that is present in the brines at its Magnolia, Arkansas, bromine facil-ity and to utilize it to produce lithium carbonate. The market for lithium chemicals is expected to grow rapidly, reaching $1.2 billion globally by 2015, primarily from increased demand for batteries in electrical vehicles. Using this new technology and brine from its bromine production facility, Albemarle has produced lithium carbon-ate in a lab setting and is currently operating a pilot plant to optimize the process. Commercial production could begin as early as 2013.

For the third consecutive year, Air Products received a Pinnacle Award for chemical transportation safety from Union Pacific Railroad. The award was recently presented to company representatives at an event held in Houston, Texas. The Pinnacle Award annually recognizes companies that have implemented successful prevention and corrective plans and have achieved a rate of zero non-acci-dent releases for shipments of regulated hazardous material. Air Products previously won this award six times between 1996 and 2006. The Union Pacific award program, which began in 1996, is open to all Union Pacific chemical and petrochemical cus-tomers. Criteria include safe loading techniques, security level of shipments and zero non-accident releases.

Unrest in North Africa and the Middle East, coupled with the disaster in Japan, threatens the sustainability of the global economic recovery, but the momentum of growth is thought to be strong enough in most regions to absorb the shocks, according to a quarterly analysis report from Ernst & Young. However, global economic growth projections are being reduced, dropping to around 4% for 2011. Despite the fact that short-term oil and gas supply and demand remains relatively balanced, oil prices have gone up in anticipation of supply shocks, the report says.

We are dealing with a new kind of oil shock, said Marcela Donadio, Americas oil and gas leader for Ernst & Young. Driven by angst over broad geopolitical concerns, markets are proactively reacting to a potential supply problem. HP

Natural gas demand

HEINZ P. BLOCH, RELIABILITY/EQUIPMENT EDITOR

HPIN RELIABILITY

[email protected]


Expansion chambers (Fig. 1) are designed to restrict pressure increase in closed volumes. From basic physics, we, of course, know that the pressure in a closed volume increases as temperature goes up. In case a shaft seal is so tight that it will no longer allow air confined in bearing hous-ings or gearboxes to flow in and out, the trapped air would be pressurized as temper-ature rises. Creating a larger volume for the trapped air would keep the pressure down. We find expansion chambers advertised for use on process pumps and gearboxes. They can replace breather vents that are com-monly found on pump-bearing housings or gear casings.

Most expansion chambers incorporate a rolling diaphragm (usually Viton and, occasionally, Teflon). The diaphragm divides the interior volume of the chamber so that ambient air can be aspirated into, or expelled from, the (up-facing) space above the diaphragm. The down-facing surface of the diaphragm is contacted by air (or an air-oil mixture) that exists in, say, a pump-bearing housing or gearbox interior.

Examining the premise is always a good first step. About two years ago, a shaft-seal supplier started discussions with a wind turbine gearbox manufacturer. The seal supplier wanted advice on calculating the size of expansion chambers for gear-boxes with dimensions in the vicinity of 3 m x 2 m x 2 m. A worst-case oil-to-ambi-ent temperature difference of 100C was anticipated by the two parties. Realistically speaking, temperature differences of 100C (180F) are rather unusual in a gearbox. We should always look at the bigger pic-ture and perhaps even challenge the basic premise.

That said, lets be certain to select the right lubricant and to accommodate ther-mal expansion which, on a 3-m-long steel gearbox, might be somewhere around 0.14 in. We obtained this number by multiply-ing the coefficient of expansion for steel, times the length, L (in.), times the antici-pated temperature, T, change:

L = 0.0000065 L TAnyway, heres the academic exercise.

We might elect to work with a base temper-ature of, say, 100F, which would be (100 + 460) = 560 Rankine. Continuing in US units, an increase of 100C (180F) is (180 + 560) = 740 Rankine.

Charles Law states that the volume of an ideal gas at constant pressure varies directly as the absolute temperature; thus, V2=V1 (T2 / T1 ) = Constant. For equal pressure, the new volume, V2, would have to be V1 (740/560), or 1.32 times that of the original air space (or volume) of 1. Thus, 0.32 volume units would have to be added to the original air space or volume unit of 1.

Also, the volume of an expansion chamber would have to be larger if we had assumed a lower base temperature, say, 0F. In that case, the needed volume addition would be based onV1 (640/460)1and 0.39 volume units would have to be added to an original air space or volume of 1.

Much of the 3 m-by-2-m-by-2 m overall gearbox volume will be taken up by the gears and oil. So, if the remaining air vol-ume had been 30% of the gearbox total, i.e., 0.3 12 = 3.6 m3, one would have to add an expansion chamber with a useable volume of0.32 3.6 = 1.15 m3in the first instance. In the second instance, the needed addition would be0.39 3.6 = 1.4 m3.

While this might have answered the original question, I now imagined all kinds of different scenarios, including seeing a 1.15 m3 or 1.4 m3 hump on the gearboxes of future wind turbines. Or perhaps none, because someone explained intelligent-seal-ing options to the gearbox manufacturer. An intelligent-sealing option would be a balanced seal, or a seal that can take the pressure increase that comes with a con-stant volume. Let me explain.

Pressure increase with constant volume. Suppose we didnt add an expanding volume to the wind turbine gearbox and the temperature rose from 0F

(18C) to 180F (83C). What would be the pressure increase? Well, we might just google gas law and observe the before vs. after conditions indicated by the sub-1 and sub-2 characters:

P1V1 / n1T1 = P2V2 / n2T2The molecular masses, n, probably will

not change, and neither will the volume. We assume that our installation is at sea level and atmospheric pressure is 14.7 psia. Therefore, the absolute pressure will change in direct proportion to the absolute tem-perature:

P2 = P1T2 / T1 = 14.7 psia 740R / 560R = 19.4 psia

The P across the seal would be 19.4 14.7 = 4.7 psi. Now, we could design a seal for that, even if we needed to divert a slip stream of bearing lubricant to provide a bit of cooling for the seal. So, we might not need the expansion chamber, after all? HP

How do you size expansion chambers (assuming it is needed)

The author is Hydrocarbon Processings Reliability/Equipment Editor. A practicing consulting engineer with close to 50 years of applicable experience, he advises process plants worldwide on failure analysis, reliability improvement and maintenance cost. He has authored or co-authored 18 textbooks on machinery reliability improvement and close to 500 papers or articles. For more, read his book, PUMP WISDOM, Problem Solving for Operators and Specialists, John Wiley & Sons, 2011.

A threaded-type expansion chamber is sometimes used at the location where the bearing housing vent had been installed originally.

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DICK HILL, CONTRIBUTING EDITOR

HPINTEGRATION STRATEGIES

[email protected]


LG Chem is Koreas first and largest vertically integrated chemical company. Founded in 1947, the company has emerged as one of the worlds top 30 chemical makers. LG Chem produces a variety of chemical products ranging from petrochemicals to specialty chemicals, as well as electronic materials.

Last year, ARC interviewed Mr. Chang-Hoon Kang, project manager at the Petrochemicals Divisions Daesan ethylene plant. Mr. Kang told us that, previously, the plant had problems meet-ing corporate goals due to a variety of issues such as variability of feedstock quality. However, using an advanced process control-based (APC) solution, the engineering team solved the problem to achieve plant operational stability, increase production, and decrease energy consumption. In doing so, the benefits more than paid for the investment.

Plant operations needed stability. LG Chems Daesan ethylene plant is an important asset in LG Chems Petrochemi-cals unit. The plant was experiencing difficulty in meeting its corporate operations goals due to a variety of issues. The naphtha feed typically varies considerably in quality, and the plant has issues related to furnace decoking, and tank and dryer swings. Since ethylene crackers are major energy-consuming units, the dynamics of the process further prohibited any attempts at com-prehensive energy management. This all contributed to a process that was seldom in steady state.

Through a quality improvement program called gaisen, the company had previously improved the process, more than dou-bling the capacity from 350,000 tpy to the current world-class capacity of 760,000 tpy. The underlying problems, however, continued to cause plant upsets, resulting in total productivity well below corporate expectations.

To have a chance at meeting corporate goals, the company realized that it must stabilize operations before it could concen-trate on maximizing plant throughput, which is why the com-pany invested to increase the plants capacity in the first place. Another LG Chem objective was to minimize energy consump-tion to produce ethylene.

LG Chem realized there was only so much improvement that could achieved with process and procedure changes. The company had some success at its Yosu plant using multivariable control, and the plant manager at Daesan was keen on trying to adopt this approach. LG Chem chose to work with AspenTech. Together, the two companies decided that the plant needed to go further than just applying multivariable control to the 11 ethylene cracker furnaces. The solution needed to be integrated with the ethylene and propylene recovery areas downstream of the furnaces. Due to the plantwide scope, inherent feedstock variations and other disturbances, they decided to incorporate the Composite Linear Program (CLP) tools with Aspen DMCplus. LG Chems LGSim ethylene furnace model was used to create

an online model for composition and severity for the CLP and multivariable controllers.

Since this was the plants first experience at such a compre-hensive change in automation, it had to be established through proper leadership to help people understand the coming changes. For example, the changes in the way the operators managed the process required quick adoption of new methods. Getting the employees, from operators to engineers, to work together as a team was an important challenge to overcome early on.

This was to be an integrated approach to automation; so they had to establish effective connectivity between the existing distributed control systems (DCSs) and the new APC and opti-mization solution. In addition, since success relied on accurate and highly available instrumentation, they had to incorporate strategies to deal with any instrument failures quickly.

Lessons learned and overall benefits. LG Chem learned that it was possible to do such a large scope project in a short period (eight months) and within budget. This was possible partly due to the team had secured senior managements backing early in the project scope and partly because the project team included three members from the supplier and three LG Chem employees. Including LG Chem personnel on the team continues to help, as these team members can make the necessary minor adjustments themselves over the course of the year. If a big issue arises, then they can organize a task force quickly and, if necessary, call in AspenTech under their annual maintenance agreement.

LG Chem is very satisfied with the stable operation provided by the advanced automation. The APC has a 90% service factor and drives the unit operations to the appropriate constraints. Management and operating personnel alike are now armed with key performance indicators and other performance information to help everyone stay on the productivity path.

LG Chems eight-month effort and $400,000 expenditure resulted in a 2% increase in ethylene and propylene production. The stabilization of the plant reduced total energy consumption by 1.5%. Combined, this represents the equivalent of about $4 million in annual benefits. HP

Korean ethylene plant reaps benefits from APC

The author is vice president of ARC Advisory Group, Dedham, Massachusetts, responsible for developing the strategic direction for ARC products, services and geographical expansion. He is responsible for covering advanced software business worldwide. In addition, he provides leadership for support of ARC's automation team and clients. Mr. Hill has over 30 years of experience in manufacturing and automation. He has broad international experience with The Foxboro Company. Prior to Foxboro, Mr. Hill was a senior process control engineer with BP Oil, develop-ing and implementing advanced process control applications. Prior to joining ARC, he was the US general manager of Walsh Automation, a major engineering con-sulting firm and supplier of CIM solutions to the pulp and paper, petrochemicals, pharmaceutical, and other process and manufacturing industries. He is a graduate from Lowell Technological Institute with a BS degree in chemical engineering.

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HPIMPACT

Refining margins under pressure to 2015

KBC Advanced Technologies recently published its refining outlook, a report that analyzes issues facing the global oil refin-ing sector and discusses their impact on the crude-oil and refined-products markets. KBC foresees global refining margins con-tinuing under pressure in the medium term as recovering global demand is met by a con-tinuing wave of new refining capacity con-struction that will see global refining utiliza-tion rates remain around 85% of nameplate capacity at least through 2015.

The report highlights the key pres-sures that face refiners, including declining demand in mature economies; tightening global standards for marine fuel quality; increased taxation and regulation of carbon dioxide emissions; and competition from biofuels and natural gas liquids (NGLs) from export-oriented refining countries like India, Russia and, increasingly, Brazil.

In the Americas, major investment in a number of Latin American countries, coupled with increased distillate production capability in US Gulf Coast refineries, will see a rise in the export of finished products to Europe and Africa. Brazil alone is set to add over 1.2 million bpd of new refining capac-ity by 2020 as it aims to process most of its expanding crude-oil production domesti-cally and to export the products.

In Asia, KBC sees both China and India continuing to add refining capacity. China is expected to build new capacity in line with its surging domestic demand for transport fuels and petrochemical feedstock, driving

global demand for crude oil while still hav-ing only a limited impact on product mar-kets. Indias refinersboth public sector and privatecontinue to advance plans that will keep the country in strong surplus, eagerly eyeing export markets in other Asian coun-tries and further abroad.

Middle Eastern refiners are also expected to add refining capacity above their domestic requirements, with 1.6 million bpd of firm new capacity expected by 2016 in Saudi Ara-bia and the UAE, and more than 1 million further bpd of potential capacity to be built elsewhere on the Arabian Peninsula. Iran and Iraq both continue to plan significant new additions as well, though geopolitical realities suggest no clear timeline for these additions. Surplus output from Middle Eastern refineries will compete with Asian products for markets in Asia and Europe, making operational efficiency, freight costs and crude-oil pricing key parameters in a highly competitive market.

European refiners face rising clean-fuels import competition from the Americas, Asia and Russia. KBC anticipates a significant wave of Russian refining upgrading invest-ment driven by recent reforms in Russias export tariff structure. These upgrades could see Russias exports swing from relatively low-quality intermediates, like vacuum gasoil and M-100 fuel oil, to higher-quality finished products that meet European standards. With declining export markets for surplus gasoline, a functioning carbon market from 2013 and a swing to distillate bunker fuels in the North Sea/Baltic corridor, Europes refin-ers face the greatest pressure in the global scenario, although unlike some more bearish

analysts, KBC anticipates only limited future closures, instead anticipating a prolonged period of relatively low utilization rates.

With over 2 million bpd of refining capacity earmarked for closure and around 8 million bpd announced for sale, or sold, since 2009, the refining industry faces an anxious period of transition over the next five years, with new entrants attempting to profit where experienced operators have chosen to exit. KBC sounds a note of caution in this years annual refining outlookundoubt-edly the refining market is better now than it was a year ago, but this is not necessarily an upward trend. Refining will remain a tough business over the next few years.

US PVC producers see healthy exports

PVC demand returned to positive growth in 2010 following the collapse in consump-tion experienced in 2008 and 2009, accord-ing to a new report on market dynamics in the vinyls chain, published by Nexant.

The global economic slowdown has taken its toll on the construction sector, and building activity in Europe and North America has been dramatically reduced. China has become the main driver of global growth. After a decline in Chinese demand during 2008, the Chinese governments economic stimulus packages have buoyed consumption and underpinned positive growth for the time period of 20092010. Producers in Western regions have been able to maintain operating rates due to a large volume of exports. US producers benefitted from reduced ethylene feedstock costs, large

BILLY THINNES, TECHNICAL EDITOR

[email protected]

02008

North AmericaSouth AmericaWestern EuropeCentral Europe

Eastern EuropeMiddle EastAfricaAsia-Pacific

2009 2010 2011 2012 2013 2015 2020 2025

10,000

Thou

sand

, ton

s

20,000

30,000

40,000

50,000

60,000

70,000

80,000

Regional PVC consumption, 20082025.FIG. 1

-1,000

0

1,000

2,000

3,000

4,000

5,000

2008 2009 2010 2011 2012 2013

North AmericaSouth AmericaWestern EuropeCentral Europe

Eastern EuropeMiddle EastAfricaAsia-Pacific

Thou

sand

, ton

s

Regional PVC capacity additions, 20082013. FIG. 2

16 I JUNE 2011 HydrocarbonProcessing.com

HPIMPACT

integrated plants and a weak dollar with the country responsible for over 60% of global trade in 2010.

Operating rates remained at historical lows in 2010, with the output of large sec-tions of acetylene-based Chinese capacity limited in the second half of the year as government policy on energy conservation reduced supply of calcium-carbide feedstock.

PVC demand growth is forecast to con-tinue in 2011, but the start-up of additional capacity in China will see global operating rates remaining low.

Consumption. In recent years, envi-ronmental and safety issues, as well as substitution by polyethylene, have nega-tively affected PVC consumption. Several countries have legislated against the use of plasticized PVC in childrens toys. PVC consumption in food packaging has also declined, although more as a result of bet-ter cost-performance of other polymers than its poor environmental and health perception. In addition, substitution by polyolefins in cable and wire applications and certain construction applications have eased growth in some segments. How-

ever, the cost competitiveness of PVC is expected to maintain support for consump-tion growth in the key construction sector once that industry recovers.

High consumption growth in populous nations such as China and India will make Asia the major driver of global PVC con-sumption growth. While consumption in the United States has been declining since 2004, growth in Mexico and an expected recovery in demand in the United States will support future growth rates in North America. Western Europe will show the low-est growth, due to the already high per-capita consumption rate, and low GDP growth outlook. Growth in Eastern Europe and the Middle East is running at very high rates due to oil wealth, while demand in South America will benefit from high GDP growth and infrastructure development (Fig. 1).

Supply. Regional capacity development shows considerable variation due to the sharply differing consumption outlook and cost of production in different regions. Low growth and high energy prices make investment in North America and Western Europe unattractive, while the opposite is

true in the Middle East. Capacity develop-ment in China is proceeding rapidly due to the massive demand growth and the relative attractiveness of coal-based production there. Other parts of Asia show minimal develop-ment due to the lack of competitively priced feedstock and the abundance of capac-ity already installed. Some major capacity developments already underway in North America have proceeded despite the ongoing contraction in domestic demand. Much of this new supply will go to foreign markets.

The capacity development that is under-way in China is unprecedented. Capacity has expanded from 5 million tpy in 2003 to over 15 million tpy in 2009, almost 90% of total global capacity expansion over the period (Fig. 2). Despite legitimate environ-mental concerns, relating both to massive carbon emissions and mercury pollution, the development of acetylene-based capacity in China shows no sign of slowing. The govern-ments effort to restrict the construction and expansion of less efficient, environmentally hazardous plants has had little impact on the overall pace of development, although it has perhaps prevented some sub-scale projects from moving ahead.

While coal/acetylene technology has been progressively replaced by ethylene-based pro-duction in other regions, coal-based pro-duction in China has been encouraged, as it does not require imported feedstock or compete for the limited supplies of ethylene. The required feedstocks (coal and limestone) are concentrated in the Western part of the country, which is comparatively underde-veloped. Industrial activity there is subse-quently inexpensive, and provides economic growth in otherwise isolated areas.

The pace of capacity development in the Middle East has been slow because of the lack of local consumers for the caustic soda byproduct from chlorine production, and the availability of more attractive investment opportunities in olefins. The higher long-term global energy pricing environment has however brought the focus back onto the ethylene and power cost advantages in the region, leading to new interest in projects. Regional demand growth has also consider-ably outpaced previous expectations, provid-ing a much larger domestic market for new entrants to sell into.

Demand and trade. Operating rates have fallen sharply in recent years as capac-ity has increased while demand has fallen. Further capacity additions in Asia, Eastern Europe and the Middle East will see rates

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HPIMPACT

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fall through 2011, before beginning to recover in 2012.

The arrival of large volumes of acetylene-based PVC production has changed many aspects of the global market. The massive development in capacity has offset imports of PVC into China, which had been run-ning in excess of 2 million tons per year over 20012004. As the acetylene-based product set the price in the Chinese market, ethyl-ene-based operators had difficulty selling into the domestic market due to the rapid increase in their cost of production, which was fundamentally based on crude oil as in other regions. Chinese product was there-fore aggressively marketed around the world, while China continued to import from more competitive integrated operators in neigh-boring countries in East Asia. The temporary reduction in oil prices between 2008 and 2010 eroded the advantage seen by acety-lene-based producers, leading to a marked increase in imports into China. As the capac-ity build continues, China is expected to increase production and move to a balanced position forcing its East Asian counterparts to look further afield once more.

Exports from North America have risen sharply in recent years, driven higher by a combination of large capacity additions, declining domestic demand and the benefit of ethane-based ethylene supply. The major effect has come from the US, where exports increased from 650,000 tons in 2005 to 2.7 million tons in 2010. The US is forecast to remain a net exporter but the overall level of exports will decline as the local construction market recovers.

The rapid growth of demand in the Mid-dle East has outpaced new capacity devel-opment. The current slate of projects will not be sufficient to meet demand growth, and therefore the region will remain a net importer for much of the outlook period. Most of the import growth to date has been from East Asia.

Oil and gas supports two million jobs in Texas

The US oil and natural gas industry sup-ports two million jobs in Texas and 24% of the states economy, according to a new study commissioned by API and conducted by PricewaterhouseCoopers.

API President Jack Gerard said that Pres-ident Obama and Congress should keep the studys findings in mind as they debate greater access to domestic oil and natural gas, along with higher taxes on energy.

Increasing energy taxes raises costs for businesses, which may impact consumers, and it threatens the two million jobs our industry supports in Texas, Mr. Gerard said. Higher taxes would also depress energy production over the longer term, reducing royalties and income taxes col-lected by the government.

The new report updates data from a previous report and shows that, between 2007 and 2009, the economic activity sup-

ported by the industry nationwide actually increased in size as a percentage of US GDP, from 7.5% to 7.7%. The industry supports 9.2 million jobs in the US.

The people of the US oil and natural gas industry are the backbone of our economy, Mr. Gerard said. They provide most of the nations energy, spurring job growth across America. Even during times of economic recession, the oil and natural gas industry stands strong. HP


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SELECTED BY HYDROCARBON PROCESSING EDITORS

[email protected]

Foam provides effective thermal insulation

BASFs specialty foam Basotect is now used for the first time to insulate pipes in a liquefied natural gas (LNG) tank termi-nal in Gwangyang, Korea. The pipe cover with Basotect provides energy-efficient thermal insulation, easy handling and flame retardancy. LNG is natural gas that is temporarily liquefied at very low tem-peratures, to transport or store it more easily. As the temperature of LNG must be kept below 162C, efficient insulation for the pipes is necessary.

According to SKI Insulation, the sys-tem supplier of the removable insulation cover, the pipe cover made from Baso-tect is more energy efficient as it is 20% thinner and provides up to 50% better thermal insulation than conventional foam insulation. Basotect shows a high degree of stability at low temperatures, said Dr. Peter Wolf, Head of Global Busi-ness Management Basotect at BASF. In laboratory tests even at temperatures of around 200C the material retains its properties. The high degree of elasticity and the thermal insulation capacity of the foam remain unaffected, in contrast to conventional foam insulation, which becomes brittle when exposed to such extreme cold.

Basotect can be installed and handled in an easy and cost-effective way. SKI Insulation discovered that the system material with the lightweight and flex-ible BASF foam can be easily removed for regular inspection of pipe integrity and later reused, unlike rigid conven-tional foams that are hard to replace. This translates into reduced maintenance costs. Additionally, Basotect is a highly flame-retardant materialanother key consid-eration for SKI Insulation as natural gas burns easily.Select 1 at www.HydrocarbonProcessing.com/RS

Ultra-low NOx burner eliminates need for ignitor fuel train

Hamworthy Peabody Combustion announced the introduction of its new ECOjet ultra-low nitrous oxides (NOx ) burner (Fig. 1). After almost three years of research and development, including

the use of Hamworthy Peabody Combus-tions SMARTflow flow modeling, and the resources of Hamworthy Peabody Com-bustions World-Leading Advanced Tech-nology Center (14 test furnaces/testing burner capacities to 300 MMBtu/hr), the ECOjet emerged, offering ultra-low emis-sions with little or no flue-gas recirculation. Every aspect of the burner from air entry to gas and oil nozzles to swirler was strategi-cally designed, developed and tested.

Ignition is achieved using the highly reliable, self-cleaning and low maintenance Chentronics (a Hamworthy Combustion Group company) high energy direct-spark ignitor. The burst-mode ignition with flashing indicator allows the operator to observe the ignitor condition during oper-ation. This also eliminates the need for an ignitor fuel train. Gas-electric ignitors are also available for firing natural gas, pro-pane, coke oven gas, etc.

Easy to install, operate and maintain Reliable and virtually mainten-

ance-free, self-cleaning high-energy spark ignition.

Staged gas design provides extremely stable flames, up to 20:1 burner turndown, hot standby, available continuous pilot and precise furnace warmup.

Ultra-low NOx on a full range of gas-eous fuels (natural gas, propane, refinery gas, landfill gas, off-gases)

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Applicable to package, industrial, and utility boilers ranging from single to multi-burner wall-fired, turbo, and other boiler types

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Burner ramp rates not limited by speed

Does not require complicated control systems

Does not require special fuel or com-bustion air filtration or straining

Capacities to 400 MMBtu/hr.Select 2 at www.HydrocarbonProcessing.com/RS

Differential pressure sensor measures up to 2,000 psi

American Sensor Technologies, Inc. offers the AST5400 wet/wet differential pressure sensor to measure line pressures up to 2,000 psi with a turndown ratio of 15:1. This cost-effective sensor brings the features of differential pressure sensors to the process industry market at an eco-nomical price. The AST5400 differential pressure sensor can be used to measure differential pressure across a filter, monitor level in a sealed or vented tank, or calcu-late flow across an orifice plate.

Using Krystal Bond Technology, the AST5400 pressure sensors contain no sili-cone oil, O-rings or welds. This micro-electro mechanical systems (MEMS) pressure-sensor technology completely isolates the media to the pressure ports, thus eliminating contamination risk. The low strain level on the diaphragm results in accurate, repeatable measure-ments. This differential pressure sensor, with its high line pressure capability, can be installed into systems without five-way

As HP editors, we hear about new products, patents, software, processes, services, etc., that are true industry innovationsa cut above the typical product offerings. This section enables us to highlight these significant developments. For more information from these companies, please go to our website at www.HydrocarbonProcessing.com/rs and select the reader service number.

Hamworthy Peabody Combustion ECOjet ultra-low NOx burner.

FIG. 1

HPINNOVATIONS

20

equalization valves, saving users hundreds of dollars per installation.

The AST5400 sensor replaces systems that use two gauge pressure sensors to calculate differential pressure, saving on installation time and cost. Since the accu-racy or inaccuracy of two-sensor systems is additive, the AST5400 system can easily increase performance over temperature.

With the advancements in electron-ics, users of differential pressure switches

can now use a sensor to monitor system performance and trends in applications requiring a high turn-down and high cycle performance. Alarm functions can be added through most controllers, mak-ing the switch obsolete.

With digital compensation, the AST5400 series offers excellent linearity and performance over temperature. The electronics offer a fail-safe condition on the output signal. If the transducer were

to experience a fault condition, the trans-ducer can be programmed to rail the out-put signal to 10% below the minimum or 10% above the maximumoutput signal to notify the user of an issue and protect the system from undesirable conditions. The AST5400 series also offers excellent flexibility, allowing for a variety of wetted materials and pressure ports.Select 3 at www.HydrocarbonProcessing.com/RS

BEM technology identifies structural defects

InfraMetrix LLC announced a new bur-ied infrastructure diagnostic service that utilizes broadband electromagnetic (BEM) eddy current technology. InfraMetrix is the only US firm licensed to offer BEM for water, sewer and gas utilities. Unlike ultrasonic and magnetic flux leakage test-ing, BEM is truly a non-invasive technol-ogy. BEM will identify evidence of fer-rous pipeline wall loss or other structural defects, enabling fast remedial action.

BEM, first developed in Australia, is a technology that can be used internally or externally, and will provide an accurate profile of the pipe wall and detect metal loss down to 125 in. BEM produces wall-thickness contour maps that illustrate remaining wall thickness at surveyed sec-tions. Estimates of annual rate of wall-thickness loss and remaining useful life are easily determined with BEM data.

BEM offers two major advantages over other pipeline inspection technologies. First, it does not require direct contact with the metal, and can determine the thickness of the surveyed pipeline through coatings and linings without their removal. Second, it eliminates service disruptions because pipes can be inspected without disrupting service.

Bill DiTullio, president of InfraMetrix, stated, The rate of deterioration of bur-ied ferrous water, sewer and gas pressure pipelines is not solely a function of age and material, but rather the cumulative effect of the environment that surrounds these assets. As a result, desktop studies alone are insufficient for making capital expenditure decisions. At the opposite end of the spec-trum, it is not practical or even necessary to perform an internal inspection of the entire network to locate where the greatest risk of failure exists. I believe that BEM provides the most cost-effective solution for planning capital investments, espe-cially when capital resources are limited. BEM provides a quick and cost-effective

Experience is in Mustangs DNA.To say that Mustang has automation and control experience is anunderstatement. Most of its management team has worked in the industryfor more than 30 years. They are supported by specialists, managers andengineers averaging close to 20 years of systems expertise and industryproject knowledge. Mustang offers vendor independence, alliances with themost recognized technology producers and global experience in:

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assessment of the risk of failure of buried metal pipelines, and a program of desktop investigations and making the best use of funds for assessing the risk of failure and threat to public health and safety.

InfraMetrix was recently awarded a number of BEM survey contracts in the US and abroad. The owner and utility companies are now able to save thou-sands of dollars using BEM technology, they will be able to assess the condition

of the pipeline while it remains in service.Select 4 at www.HydrocarbonProcessing.com/RS

Module facilitates optimal management for gas turbines

Dresser-Rand, a global supplier of rotating equipment solutions to the oil, gas, petrochemical, and process industries announced the availability of its Envision Gas Turbine (GT) Performance Module.

The module is designed to assist opera-

tors and field service personnel in their day-to-day operation of General Electric aero derivative gas turbines. This is accomplished by gathering and analyzing real-time data to calculate thermodynamic performance. The outputs of the GT Performance Module are ISO reference corrected and humidity cor-rected, specifically for the General Electric LM series gas turbines.

The GT Performance Module facili-tates the optimal management of gas turbines. Its development was based on decades of packaging experience with the GE LM2500 to accurately calculate tur-bine performance as if it were on a Dresser-Rand factory test stand, said Dan Levin, general manager, Dresser-Rand Control Systems. It facilitates the effective plan-ning for operational and maintenance activities ahead of a planned shutdown.

Dresser-Rands GT Performance Mod-ule provides two direct benefits to the GE LM2500 gas turbine generator set. First, it lowers operating costs. The real-time monitoring of gas turbine performance can help ensure a generator set operates at peak efficiency. Recognizing indications of performance degradation early allows for prompt corrective action to prevent excessive energy/fuel usage and reduced turbine life. Second, it provides predictive maintenance capabilities that are crucial in identifying performance degradation from irregularities like turbine compres-sor fouling, imbalanced fuel nozzles, com-pressor rotating stall, expander efficiency degradation and exhaust pressure drop.

Users can assess the engines perfor-mance relative to OEM-determined pre-dictions, Levin said. With this informa-tion, operational and maintenance activities can be planned in advance of a scheduled shutdown. Users can also reduce the impact on production and decide what corrective actions are needed before servicing the tur-bine. This is crucial for the optimal func-tioning of General Electric aero derivatives.

The GT Performance Module also adds value by allowing for the optimization of an engines maintenance schedule. With lower costs from fewer maintenance intervals and the increased turbine runtime, the total cost savings from maintenance optimiza-tion could be significant.

One of the modules key advantages is providing comprehensive information in various forms when and where its needed. Users can select from multiple graph for-mats or create trends from stored data. Select 5 at www.HydrocarbonProcessing.com/RS

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HPIN CONSTRUCTIONHELEN MECHE, ASSOCIATE EDITOR

[email protected]

North AmericaKBR has been awarded a $65 million

contract by Chevron Products Co. to exe-cute a base-oil expansion project at Chev-rons refinery in Pascagoula, Mississippi. The construction project includes building a new lubes hydrocracker and a lube dewaxing/hydrofinishing unit. Work is expected to begin in May 2011, and upon completion, the facility is expected to be one of the larg-est premium base-oil plants in the world.

Shell has successfully started produc-tion from its Scotford Upgrader Expan-sion project in Canada. The 100,000-bpd expansion takes upgrading capacity at Scot-ford to 255,000 bpd of heavy oil from the Athabasca oil sands. This marks the first commercial production from the upgrader expansion. The Scotford Upgrader pro-cesses oil sands bitumenheavy oilfrom the Muskeg River Mine and Jackpine Mine for use in refined oil products.

Westlake Chemical Corp. has an expansion program that includes increasing the ethane-based ethylene capacity at Lake Charles, Louisiana, and evaluating expan-sion options and the upgrading of ethylene production facilities at Calvert City, Ken-tucky, to capitalize on new low-cost ethane and other light feedstocks being devel-oped in North America.

Each of the companys two light feed-stock ethylene crackers in Lake Charles will be expanded as part of this program. These expansions will commence as planned maintenance turnarounds occur in order to provide ethylene for existing internal deriva-tives units and the merchant market. The first cracker expansion will increase capacity by approximately 230240 million lb/yr, while also increasing feedstock flexibility. It is expected that this project will be com-pleted by late 2012 and a second expansion concluded by the end of 2014.

PetroAlgae Inc. has an agreement with Haldor Topse and its US subsidiary, Hal-dor Topse, Inc., to provide technology and catalysts to upgrade oils produced from PetroAlgaes biomass through refinery coking processes and pyrolysis into drop-in renew-able fuels, including diesel and jet fuels.

Under the agreement, the two compa-nies will work together to apply Haldor Topse catalysts, equipment and licensed technology to upgrade oils derived from PetroAlgaes biocrude.

URS Corp. has been awarded a contract by BP Products North America Inc. to provide construction and maintenance ser-vices, including electrical, mechanical, pip-ing, instrumentation and civil works to the Whiting Refinery in Whiting, Indiana. The three-year contract has a maximum value of $150 million for URS.

CB&I has a project, valued in excess of $45 million, for storage tanks at an oil sands project near Fort McMurray, Alberta, Canada. CB&Is scope of work includes the engineering, procurement, fabrication and construction of 12 cone-roof tanks at the oil sands project. CB&Is contract is scheduled for completion in 2013.

Technip has an engineering, pro-curement and construction-support ser-vices contract with Canadian Natural Resources Ltd., worth approximately 100 million, for the Horizon project in Fort McMurray, Alberta, Canada. The contract covers the expansion of the existing delayed coking unit, completed by Technip in 2008. It confirms Technips leading position in the refining of nonconventional hydrocarbons such as refining bitumen.

Technips operating center in Rome, Italy, will execute the contract which is scheduled to be completed in 2013. Detail engineering, procurement and supply of materials and equipment will be delivered on a lump-sum basis, while the construc-tion management will be charged on a reimbursable basis.

Bayer MaterialScience is set to invest some $120 million into its Baytown, Texas, site. The Baytown site, which cel-ebrates 40 years of manufacturing success this year, is the companys largest man-ufacturing facility in the US, and it is a keystone of Bayer MaterialSciences global manufacturing strategy.

The planned $120 million investment includes:

Methylene diphenyl diisocya-nate (MDI)environmental upgrades, reliability improvements and minor debottlenecking

Toluene diisocyanate (TDI)improved process technology, environ-mental upgrades, and energy-efficiency and reliability improvements that will increase productivity

Polycarbonatereliability upgrades and quality improvements for advanced optical applications.

South AmericaTechnip, in consortium with Tom

Engenharia, was awarded a lump-sum turnkey EPC contract by Petrobras for five new units at the Presidente Bernardes Refinery in Cubato, state of So Paulo, Brazil. This contract covers EPC, commis-sioning, pre-operation and assisted opera-tion of five new process units, including a diesel hydrotreater and a hydrogen plant, as well as all associated utilities.

The project, which is scheduled to be completed by the end of 2013, will produce low-sulfur-content diesel to comply with new Brazilian environmental regulations.

Oxford Catalysts Group PLCs gas-to-liquids (GTL) demonstration plant has arrived in Fortaleza, Brazil, following the timely completion of its construction in Asia last year. The integrated GTL dem-

Trend analysis forecastingHydrocarbon Processing maintains an

extensive database of historical HPI proj-ect information. The Boxscore Database is a 35-year compilation of projects by type, oper-ating company, licensor, engineering/construc-tor, location, etc. Many companies use the his-torical data for trending or sales forecasting.

The historical information is available in comma-delimited or Excel and can be custom sorted to suit your needs. The cost depends on the size and complexity of the sort requested. You can focus on a narrow request, such as the history of a particular type of project, or you can obtain the entire 35-year Boxscore database or portions thereof. Simply send a clear description of the data needed and receive a prompt cost quotation.

Contact: Drew Combs P.O. Box 2608, Houston, Texas, 77252-2608713-520-4409 [email protected]


HPIN CONSTRUCTION

onstration plant incorporates the Groups proprietary microchannel reactor and catalyst technologies for the key steam methane reforming and Fischer-Tropsch steps of the GTL process. The demonstra-tion is fully funded and managed by the Groups partners Toyo Engineering Corp. and MODEC, Inc., in collaboration with Petrobras, which is hosting the demonstra-tion at its Lubnor refinery in Fortaleza.

The GTL plant will be reassembled at the demonstration site, and will then progress to the pre-commissioning and commissioning stages. These are expected to be completed within four months. The demonstration plant is scheduled to start up in September, subject to successful com-missioning and availability of the required utilities from Petrobras. Following startup, the demonstration will operate for approxi-mately nine months.

Braskem has launched the corner-stone of its new PVC plant located in Marechal Deodoro in the state of Alagoas, Brazil. Construction of the new plant has already begun and should create around 2,500 direct jobs until completed. With an investment estimated at R$1 billion,

which is the highest ever made by Braskem in a single project, the new industrial unit is scheduled to start operations in the first half of 2012.

The new plant will have an annual pro-duction capacity of 200 kilotons. Braskem already has a PVC unit in Alagoas, and this project will bring its annual PVC produc-tion capacity in the state to 460 kilotons. The new plant will reportedly make Ala-goas the largest producer of PVC in Latin America, which should help strengthen the PVC manufacturing complex that already exists in the state.

EuropeEvonik Industries has started up a new

facility to produce high-purity isobutene at its site in Antwerp, Belgium. The new plant, which involved investment of tens of mil-lions of euros, can produce up to 110,000 metric tpy of isobutene, and it forms part of the sites integrated C4 production platform. The investment has tripled Evoniks produc-tion capacity for isobutene.

A subsidiary of Foster Wheeler AGs Global Engineering and Construction Group has received a pre-FEED con-

tract from Statoil Petroleum AS for the Snhvit Future Development Project at Statoils Melkya-based liquefied natu-ral gas (LNG) facility on Melkya Island approximately 450 km north of the Arc-tic Circle, Hammerfest, Norway. Statoil has informed Foster Wheeler that further releases of pre-front-end engineering and design (pre-FEED) work to Foster Wheeler under the existing contract are likely to be made during 2011, depending upon the development option(s) selected by Statoil.

Foster Wheelers scope of work will include concept design activities to sup-port the finalization of the development concept and the plant capacity for the expansion of LNG production at the Melkya LNG facility, as well as energy optimization investigations. Foster Wheel-ers involvement through this contract will continue through 2011.

Bayer Material Science is to expand production of polycarbonate at its Krefeld-Uerdingen site in Germany through an investment of about 90 mil-lion. The plants annual capacity is to gradually reach 400,000 tons over the

China Blue Chemical Co. Ltd. and Davy Process Technology (DPT), a Johnson Matthey Co., announced the successful startup, performance test and plant acceptance of a 2,500-metric ton/day methanol plant in Hainan Island in the South China Sea in March 2011. The methanol facility is located at Dong-fang. It is the worlds largest operating coal-based methanol plant, and the methanol is used for olefin production.

This facility will produce chemical-grade methanolUS AA grade and the Chinese GB388 standard methanolto supply both the domestic Chinese market along with product available for export. The feedstock is natural gas from the China National Offshore Oil Corp.s (CNOOC) offshore wells. China Blue is a subsidiary of CNOOC.

The plant utilizes DPTs catalytic-rich gas pre-reforming technology and a DPT steam reformer for synthesis gas produc-tion and Johnson Matthey Catalysts low-pressure methanol technology featuring DPTs proprietary steam-raising converters.

The success of this plant, which was completed in 31 months from start of the contract, is due to the excellent team work and cooperation between Davy Process Technology and Johnson Matthey Catalysts as technology licensors and cata-lysts suppliers, China Blue Chemical Co. Ltd., the owner and operator, and Chengda the Chinese Design Institute, which performed the detailed engineering and construction manage-ment. The plant is 1 of 13 plants that Davy Process Technology and Johnson Matthey Catalysts have licensed globally over the past five years. HP

New methanol facility online in China

Davys Radial Flow Steam-Raising Converters.

HPIN CONSTRUCTIONnext four years in stepped increases. The current nameplate capacity is 330,000 tpy.

In addition to the polycarbonate expansion at the site, Bayer Materi-alScience is also rebuilding chlorine-production facilities to increase energy efficiency. The new facilities will utilize state-of-the-art membrane technology and the innovative companys oxygen depolarized cathode (ODC) technology. Compared with the membrane technol-ogy, ODC will reportedly reduce both electricity use and indirect CO2 emissions up to 30%.

Japan Far East Gas Co., Ltd., a com-pany newly established by ITOCHU Corp., Japan Petroleum Exploration Co., Ltd. (JAPEX), Marubeni Corp., INPEX Corp. and ITOCHU Oil Exploration Co., Ltd. (CIECO) has signed an agree-ment on the implementation of a joint study for the natural gas utilization project in the Vladivostok area with Russias state-owned gas company Gazprom.

The joint study consists of pre-front-end engineering and design (pre-FEED) for the construction of a liquefied natural gas (LNG) plant with production capacity of 10 million tpy, a preliminary feasibil-ity study on the compressed natural gas (CNG) pilot project, and a preliminary study on a gas chemical complex project. The joint study is scheduled to be com-pleted by the end of 2011.

Middle EastMerichem Co. has a licensing and

equipment-supply agreement with a lead-ing supplier of direct reduced iron (DRI) facilities to install a LO-CAT hydrogen sul-fide treatment system at a new grassroots facility in the Mideast. The 1.43 metric-tpd LO-CAT unit, provided through the Meri-chem Gas Technologies business unit, will be integrated into the overall DRI process-ing facility, with a proposed startup date during the fourth quarter of 2012.

The LO-CAT unit will be treating 70,000 Nm3/hr of natural gas with a H2S removal efficiency of 99.9%, far exceeding current environmental standards. This will be the seventh LO-CAT unit to be installed in a DRI facility worldwide.

Saudi Organometallic Chemicals Co. (SOCC), a joint venture equally owned by SABIC affiliate Saudi Spe-cialty Chemical Co. (Specialty Chem) and Albemarle Netherlands B.V. (a

wholly owned subsidiary of Albemarle Corp.), have selected Samsung Engi-neering to provide engineering, procure-ment and construction services for the SOCC aluminum alkyls manufacturing facility in Jubail, Saudi Arabia.

Samsung will immediately begin the detailed engineering in Seoul, Korea. The manufacturing facility will be con-structed in Jubail Industrial City, Saudi Arabia, at the Specialty Chem site, with

a mechanical completion date projected for the third quarter of 2012. The SOCC facility will initially manufacture 6,000 metric tpy of tri-ethyl aluminum, the key co-catalyst used in polyolefin production.

International Petroleum Investment Co. (IPIC) is proceeding with the imple-mentation of a 200,000-bpd refinery at Fujairah, UAE, at an estimated cost of $3 billion.

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HPIN CONSTRUCTIONThe Fujairah Refinery project, a stra-

tegic initiative of the government, will be located near the new Abu Dhabi crude-oil pipeline Main Oil Terminal and the UAE deepwater export terminals in Fujairah. It will be designed to process UAE crudes such as Murban, Upper Zakum and Dubai. A number of financing optionsinclud-ing, but not limited to, project financingare under consideration.

The project management consultancy (PMC) contract for the front-end engineer-ing and design (FEED) phase of the Fujai-rah Refinery was awarded to Shaw Stone & Webster in April 2011. The project is now in pre-FEED, with project completion anticipated to occur by mid 2016.

A subsidiary of Foster Wheeler AGs Global Engineering and Construc-tion Group has a contract with Bahrain National Gas Co. (BANAGAS) to under-take a feasibility study for the modifica-tions and expansion of the BANAGAS liquefied petroleum gas (LPG) facilities in Bahrain. The expansion will allow the plant to increase its gas throughput, which is planned to reach 285 million scfd of

associated gas and 18 million scfd of refin-ery offgas by 2014.

Foster Wheeler will develop options for modifications to, and expansion of, the existing facilities in line with the new throughput objectives. Foster Wheeler will then undertake a techno-economic evaluation to select the preferred option(s) for implementation. The study is sched-uled for completion in the third quarter of 2011.

Badger Licensing LLC has a contract to provide proprietary technology and basic engineering for a 300,000 metric-tpy ethylbenzene/styrene monomer (EBSM) plant for Egyptian Polystyrene Produc-tion Co. (EStyrenics). The plant will be located within the El Dekila port site in Alexandria, Egypt. The contract covers technology licensing and the front-end engineering and design (FEED) package, along with operations training and com-missioning support.

Badgers technology and engineer-ing services will provide the foundation for this EBSM plant, representing the second phase of a larger styrenics com-

plex that will support economic growth and job creation in Egypt through the development of the countrys petro-chemical master plan, said Mohamed Hafez, chairman and chief executive officer of Egyptian Polystyrene Produc-tion Co. The construction of the first phase of the styrenics complex, including a 200,000 metric-tpy polystyrene unit, is nearing completion.

Asia-PacificLummus Technology, a CB&I com-

pany, has a contract from Kazakhstan Pet-rochemical Industries Inc. LLP (KPI) for the license and basic engineering of a propane dehydrogenation unit and a poly-propylene plant. The two units, each with a design capacity of 500,000 metric tpy, are planned as part of KPIs gas-processing complex to be built in the western Atyrau region, Kazakhstan.

The propane dehydrogenation unit will make use of the CATOFIN technology for converting propane to propylene. The polypropylene plant will use the Novolen advanced gas-phase polypropylene tech-nology. This will enable KPI to produce


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a broad range of polypropylene products to meet the needs of both local and export markets. Both technologies provide high reliability and easy operability.

Haldor Topse has been awarded the contract for the second out of four substitute natural gas (SNG) projects approved by Chinas National Devel-opment and Reform Commission. The plant will be commissioned by the Hui

Neng Group, a major coal mining com-pany in the Inner Mongolia region. The plant will produce SNG based on syngas from coal gasification, and, onsite the SNG will be converted into liquefied natural gas (LNG). Topse will be the licensor for the methanation section and will supply license, engineering design, catalyst and service.

The Hui Neng SNG plant has a total planned capacity of 1.6 billion Nm3 per

year of SNG production to LNG, and the first execution phase is 400 million Nm3 of SNG per year. The plant will be opera-tional by the end of 2013.

Air Products has signed an agreement with JGC Corp. to supply its proprietary propane pre-cooled mixed-refrigerant pro-cess and MCR main heat exchanger for a two-million-tpy LNG project in Luwuk, Central Sulawesi, Indonesia. The Donggi-Senoro LNG project, a joint venture between Indonesias state-owned oil and gas company, Pertamina, along with Mit-subishi Corp., Korea Gas Corp. and PT Medco Energi Internasional, is targeted for a 2014 startup.

Supporting Chinas efforts to increase the use of biogas for renewable energy production and in motor vehicles, GE is supplying its ecomagination-approved Jen-bacher biogas engine technology to power Chinas largest ethanol production plant under construction in the city of NanYang, Henan Province. Owned by Henan Tian-guan Group, China, the new ethanol pro-duction plant will produce 500,000 m3/d of biogas, based on organic material from cassava plants.

A 36-MW onsite power plant, featur-ing GEs Jenbacher engines, is being built in multiple phases to support the etha-nol plants operations. Both new facilities are being built adjacent to the companys existing ethanol production facility, which uses a biomass digester system to convert cassavainstead of graininto ethanol in China.

GEs Jenbacher engines and associated equipment were scheduled to be delivered to the project site starting in April 2011. After completion of engine installation and commissioning, the biogas power plant is scheduled to begin operating in July 2011.

Axens and The Shaw Group Inc. have been selected to license a next-gen-eration catalytic cracking technology that will reportedly help refiners maximize propylene production and other high-value refinery products. The advanced technol-ogy, High Severity Fluidized Catalytic Cracking (HS-FCC), will reportedly pro-duce higher yields of propylene and other light valuable products than conventional FCC units. The technology developers selected Shaw and Axens to promote and license the technology worldwide.

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The HS-FCC technology has evolved during a 15-year development effort that combines the innovation of five separate entities. During Phase 1, Japans JX Nip-pon Oil & Energy Corp. (JX) and Saudi Arabias King Fahd University of Petro-leum and Minerals (KFUPM) formed a research venture. JX, which leads the technology developers, provided techni-cal research and KFUPM provided the location for initial laboratory testing facilities.

During Phase 2, Saudi Aramco joined JX and KFUPM to continue develop-ing the technology. The expanded team designed, built and operated a 30-bpd demonstration unit at Saudi Aramcos Ras Tanura refinery. JX has embarked on the third phase of development includ-ing scaling-up of a demonstration unit to a 3,000-bpd pre-commercial demon-stration unit that is being built at JXs refinery in Mizushima, Japan. Shaw and Axens provided engineering services for the unit, which is expected to be opera-tional in 2011.

The Linde Group will build and oper-ate a large hydrogen and synthesis gas plant in the Chongqing Chemical Park in Western China in a joint enterprise with Chongqing Chemical & Pharma-ceutical Holding Co. (CCPHC). The project has a total investment value of around 200 million. Linde holds 60% of the shares in the joint enterprise with CCPHC.

In future, the new onsite plant will provide the production facilities

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