Refining Petrochemicals Integration

7/30/2019 Refining Petrochemicals Integration

1/23

Raza Jawad

Regional Director, Business DevelopmentUOP Middle East Company, Dubai

Refining & Petrochemicals

IntegrationBusiness Drivers & Enabling Technologies

2006 UOP LLC. All rights reserved.UOP 4698-01

SAS-AIChE MeetingFebruary 27, 2007Al-Khobar, KSA


2/23

Refining & Petrochemicals IntegrationBusiness Drivers & Enabling Technologies

Refining & petrochemicals markets

Investment strategies

Enabling technologies

Concluding remarks

UOP 4698-02


3/23

70%

75%

80%

85%

90%

1980

1985

1990

1995

2000

2005

Average

GlobalUtilisation,%

Source: BP Statistical Review 2006

Refining Situation

Refining investments potentially attractive

Refining utilisation significantly higher in 2004 - 06Margins currently above re-investment threshold

0

2

4

6

8

1990

1994

1998

2002

2006

AverageCr

ackingMargin,$/bbl

Sources: BP Statistical Review 2006IEA 2005 / 6

Investment

threshold

UOP 4698-03


4/23

Refining Investment Imperative

~ 1.5 Mb / d incrementalrefined fuels annually

- ~ 45% in M. East + China

- Clean transport fuel growth

Refining investmentsessential

- Capacity

- Conversion

- Upgrading

Global Demand Growth

0

0.5

1

1.5

2

1996

-200

1

2001

-06

2006

-11

Mb/day,a

verage

0

0.5

1

1.5

2

2.5

%p

eryear,

average

Source: IEA, J uly, 2006

$30 40billion

per year

Substantial investments essential UOP 4698-04


5/23

Investment Remuneration

Escalating fabrication and constructioncosts affecting investment returns

Investment Risk Remains Challenging

10% Internal Rate

of Return

New 200 kb/dCracking refinery

$4bn investment~ $6+/bbl average margin

for 20+ years required

UOP 4698-05


6/23

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

Leading-EdgeTechnology

UOP 4698-06


7/23

Advantages Of Integration

UOP 4698-07

Integrated refinery and petrochemical operationsminimize 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


8/23

Adding Value to Crude

$perTo

n

0100200300400500600700800

Crude

90010001200

Fuels

Gasoline

J / K

Diesel

Fuel Oil

Petrochemicals

Benzene

PropylenePP

Styrene

Petrochemicals Can Add Significant Value

p-X

UOP 4698-08


9/23

0

5

10

15

20

25

30

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Demand

Increase

over1999

-MMM

T

Other BZ BZ to CyclohexaneBZ to Phenolics BZ to Styrenics

p-Xylene6.8%

3.6%

Sources: CMAI & UOP

Aromatics Markets

AnnualGrowth

Strong Aromatics & Derivatives Growth UOP 4698-09


10/23

Refineries are main

source of xylenes supply

Future p-X demand

growth expected to

average 1.8M MTA/Yr

3 To 4 World Scale p-X Complexes Annually

p-Xylene Capacity & Demand(Committed Projects Only)

0

5

10

15

20

25

30

35

40

45

50

1992

1996

2000

2004

2008

2012

2016

p-Xylene,

MMTA

Global Demand

ProductionCapacity

Futuresupplydeficit

Sources: PCI & UOP

UOP 4698-10


11/23

Propylene Market

MT Propylene / MT Ethylene

0.59

2004 2006 2008 2010 2012 2014

Supply fromsteam crackers

~18MM

T

A

0.40

0.35

0.45

S

team

Cracker

Production

0.54

0.64

Demand

Source: CMAI 2005

Demand

0.62

0.36

Propylenedemand

increasing

faster thansupply fromconventional

sources

Growing Demand For On-Purpose PropyleneUOP 4698-11


12/23

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

+ PetrochemicalsRefining

UOP 4698-12


13/23

Integration Strategies

LightOlefins

BTX

Detergents

Chemicals

Hydrogen

Power

Technology Provides Link

Crude

Oil

Naphtha

Reformate

FCC Intermediates LPG Cracked Naphtha

Light Cycle Oil

Residues

Kerosene

Refinery

UOP 4698-13


14/23

Crude

Oil

Naphtha

Reformate

FCC Intermediates LPG Cracked Naphtha

Light Cycle Oil

Residues

Kerosene

Refinery

Integration Strategies

LightOlefins

BTX

Detergents

Chemicals

Hydrogen

Power

Technology Provides Link UOP 4698-14


15/23

AGO / VGO

Refinery Light Olefins Integration

Gasoline

Fuel oil

C3=

FCC

PropyleneRecovery

OlefinCracking

UOP 4698-15

Olefin Cracking: Developed by Total Petrochemicals & UOPDoubles Propylene Production & Reduces C4/C5 Olefins

LPG

AGO / VGO

Fuel oil

Gasoline

C3=

Lt. OlefinRecovery

FCC

C2=Lt. Olefin

Recovery

FCC


16/23

Olefin Cracking EnhancesGas To Olefins

Ethylene &Propylene

Gas UOP / HydroMTO Process

MethanolSynthesis

OlefinCracking

20% increase in light olefin yields

Nearly 80% reduction in C4+ by-products

2:1 propylene/ethylene productionratio

UOP 4698-16


17/23

PetroFCCTM Process: BTX + Olefins

Naphtha

DistillateFuel OilCoke

53.5

14

75

28

9.5

5.55

C4s

11

1914C4

=

Traditional FCC PetroFCC Process Light Olefins

C3s6.5

24

22C3=

C2-

9

6C2

=

3

18

Aromatics

BTX

The

Petrochemicals Refinery

Enabler UOP 4698-17


18/23

Tatorayprocess

Aromatics Processing

p-Xylene

XyleneFractionation

Parexprocess

Benzene

CCRPlatforming

process

Naphtha

Conversion

Ring Adjustment

Separation

UOP 4585C-11

Proven performance track record

State of the art technology continuous innovation

Cost effective designs; high on-stream efficiency

90% ofp-X capacity since 1970 uses Parex process

BTFractionation

Sulfolane

process

Isomarprocess

UOP 4698-18


19/23

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 asfuel blendstock

Low cost,high

value BTXfeedstock

$0.75/Bbl crude increase in operating margin

LCO-X process for converting LCO to BTX recentlyannounced

UOP 4698-19


20/23

Refining

Gasification

Syn Gas Production

HydrogenCarbon monoxideFertilizerSNGOlefinsMethanol/Ethanol

Acetic acid

NaphthaDieselJet fuelWax

Electricity

Separation

O2, N2, CO2, S, sulfuric acid

TransportationFuels

Resid

Natural Gas Reforming

Electricity

Hydrogen

A Future Scenario

Chemicals

GasConversion

Power

CrudeOil

Resid

Technology Developments Key To Deeper IntegrationUOP 4698-20


21/23

Innovation, Research, Development

Broaden the knowledgebase

Leverage academic andindustrial experts

Keys to success: Collaboration / alliances

Commercialize

Technology ImperativeA Key Enabler

UOP Awarded National Medal of Technology in 2005

over 85 years of sustained technical leadership and innovationfor the worldwide petroleum refining and petrochemical

industriesbenefited quality of life throughout the world.

Universities

GovernmentLabs

Startups

TechnologyLeaders

Customers

Suppliers

uop

A Honeywell Company

UOP 4698-21

Ref: National Medal of Technology Award to UOP, 2005


22/23

Summary

Strong growth of refining and petrochemicalsmarkets, healthy margins

- Investment in additional capacity essential

Integrating petrochemicals with refining canmitigate investment risk

Continuing technology innovation key enablerfor successful integration

UOP 4698-22


23/23

Thank You

UOP 4698-23

Refining Petrochemicals Integration

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