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Petroleum Federation of India2
Governing Council
Designation Name/Organisation
Chairman : Mr. B. Ashok
ChairmanIndian Oil Corporation Limited
Vice Chairman : Mr. P. Raghavendran
President (Refinery Business)Reliance Industries Limited
Member : Mr. S.P. Gathoo
Director (HR)Bharat Petroleum Corp. Ltd.
Member : Mr. Sudhir Mathur
Chief Financial Officer
Cairn India Limited
Member : Mr. U. Venkata Ramana
Director (Technical)Chennai Petroleum Corp. Ltd.
Member : Mr. Prabhat Singh
Director (Marketing)GAIL (India) Limited
Member : Mr. Pushp Kumar Joshi
Director (HR)Hindustan Petroleum Corp. Ltd
Member : Mr. H. Kumar
Managing DirectorMangalore Refinery and Petrochemicals Ltd.
Member : Mr. P. Padmanabhan
Managing DirectorNumaligarh Refinery Limited
Member : Mr. S. K. Srivastava
Chairman & Managing DirectorOil India Limited
Member : Mr. T. K. Sengupta
Director (Offshore)Oil & Natural Gas Corp. Ltd.
Honorary Member : Mr. M. A. Pathan
Management Consultant & formerChairman, IndianOil and former ResidentDirector, Tata Group
Honorary Member : Mr. R. S. Butola
former ChairmanIndian Oil Corporation Ltd.
Member Secretary : Mr. A. K. AroraDirector GeneralPetroleum Federation of India
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Petroleum Federation of India 3
Member Organisations
S. No. Organisation CEO
1. Adani Gas Ltd. Mr. Rajeev Sharma
2. Adani Welspun Exploration Ltd. Mr. Arvind Hareendran
3. Axens India Pvt. Limited Mr. Jean Paul Margotin
4. Bharat Petroleum Corp. Ltd. Mr. S. Varadarajan
5. BP Exploration (Alpha) Ltd. Mr. Sashi Mukundan
6. BG Exploration & Production India Ltd. Mr. Shaleen Sharma
7. Bharat Heavy Electricals Ltd. Mr. B. P. Rao
8. Bharat Oman Refineries Limited Mr. R. Ramachandran
9. Cairn India Ltd. Mr. Mayank Ashar
10. Chandigarh University Mr. Satnam Singh Sandhu
11. Chennai Petroleum Corp. Ltd. Mr. Gautam Roy
12. Chemtrols Industries Limited Mr. K. Nandakumar
13. Deloitte Touche Tohmatsu India Pvt. Ltd. Mr. N. Venkatram
14. Dynamic Drilling & Services Pvt. Ltd. Mr. S. M. Malhotra
15. Engineers India Ltd. Mr. Sanjay Gupta
16. Ernst & Young LLP Mr. Rajiv Memani
17. Essar Oil Ltd. Mr. Lalit Kumar Gupta
18. ExxonMobil Gas (India) Pvt. Ltd. Mr. K. S. Kim
19. East India Petroleum Pvt. Ltd. Mr. K. Sharath Choudary
20. Fabtech Projects & Engineers Ltd. Mr. B. A. Rupnar
21. GAIL(India) Ltd. Mr. B. C. Tripathi
22. Great Eastern Energy Corporation Ltd. Mr. Yogendra Kumar Modi
23. GSPC LNG Limited Mr. D. J. Pandian
24. Gujarat State Petroleum Corporation Limited Mr. Atanu Chakraborty
25. Gujarat Power Corporation Ltd. Mr. L. Chuaungo
26. Gulf Publishing Company Mr. John T. Royall
27. Hindustan Petroleum Corp. Ltd. Ms. Nishi Vasudeva
28. HLS Asia Ltd. Mr. Rajeev Grover
29. Honeywell Automation India Ltd. Mr. Vikas Chadha
30. HPCL Mittal Energy Ltd. Mr. Prabh Das
31. Haldor Topsoe India Pvt. Ltd. Mr. Rasmus Breivik
32. IMC Ltd. Mr. A. Mallesh Rao
33. Indian Oil Corp. Ltd. Mr. B. Ashok
34. Indraprastha Gas Ltd. Mr. Narendra Kumar
35. Industrial Development Services Pvt. Ltd. Mr. R. K. Gupta
36. IHS Mr. James Burkhard
37. IOT Infrastructure & Energy Services Limited Mr. Vivek Venkatachalam
38. Jindal Drilling & Industries Limited Mr. Raghav Jindal
39. Jubilant Oil & Gas Pvt. Ltd. Mr. Rakesh Jain40. KEI-RSOS Petroleum & Energy Ltd. Lieutenant J.V. S. S. Murthy
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Petroleum Federation of India4
S. No. Organisation CEO
Mr. M. A. Pathan Management Consultant & former Chairman,IndianOil and former Resident Director, Tata Group
Mr. S. Behuria Group President, Modi Enterprises
Mr. R. S. Butola former Chairman, Indian Oil Corporation Limited
41. KPMG Mr. Richard Rekhy
42. Kellogg Brown & Root Engineering Mr. Subas C. Das
& Construction India Pvt. Ltd.
43. LanzaTech-NZ Limited Dr. Jennifer Holmgren
44. Lanco Infratech Ltd. Mr. L. Madhusudhan Rao
45. Mangalore Refinery and Petrochemicals Ltd. Mr. H. Kumar
46. Mitsui Chemicals India Private Limited Mr. Toshihiro Omura
47. Nagarjuna Oil Corp. Ltd. Mr. S. Ramasundaram
48. Niko Resources Ltd. Mr. Larry Fisher
49. Numaligarh Refinery Ltd. Mr. P. Padmanabhan
50. Oil & Natural Gas Corporation Ltd. Mr. D. K. Sarraf
51. Oil India Ltd. Mr. S. K. Srivastava
52. PCM Chemical India Pvt. Ltd. Mr. Bahrin B. Asmawi
53. Petronet LNG Ltd. Dr. A. K. Balyan
54. PMI Organization Centre Pvt Ltd. Mr. Raj Kalady
55. Praj Industries Limited Mr. Gajanan Nabar
56. PricewaterhouseCoopers Pvt. Ltd. Mr. Deepak Kapoor
57. Prize Petroleum Co. Ltd. Mr. M. K. Surana
58. Punj Lloyd Ltd. Mr. Atul Punj
59. Pandit Deendayal Petroleum University Dr. Anirbid Sircar
60. Reliance Industries Ltd. Mr. Mukesh Ambani
61. Rajiv Gandhi Institute of Petroleum Technology Dr. J. P. Gupta
62. SAP India Pvt. Ltd. Mr. Deb Deep Sengupta
63. SAS Institute (India) Pvt. Ltd. Mr. Sudipta K. Sen
64. Schlumberger Asia Services Limited Mr. S. Ramamurthy
65. Shell India Pvt. Ltd. Dr. Yasmine Hilton
66. Sud-Chemie India Pvt. Ltd. Ms. Arshia A. Lalljee
67. Shiv-Vani Oil & Gas Exploration Services Ltd. Mr. Prem Singhee
68. Tata Petrodyne Ltd. Mr. S. V. Rao
69. Tecnimont ICB Pvt. Ltd. Mr. Mario Ruzza
70. Total Oil India Pvt. Ltd. Mr. B. Vijay Kumar
71. Transocean Offshore International Ventures Ltd. Mr. Krishna Singhania
72. University of Petroleum & Energy Studies (UPES) Dr. S. J. Chopra
73. UOP India Pvt. Ltd. Mr. Steven Gimre
74. VCS Quality Services Private Ltd. Mr. Shaker Vayuvegula
75. World L. P. Gas Association Mr. James Rockall
Honorary Members
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Petroleum Federation of India 5
No part of this journal shall be reproduced in whole or in part by any means without permission fromPetroFed.
The views expressed by various authors and the information provided by them are solely from theirsources. The publishers and editors are in no way responsible for these views and may not necessarilysubscribe to these views.
Ms. Marianne Karmarkar Bharat Petroleum Corporation Ltd.
Mr. S. Vaidyanathan Chennai Petroleum Corporation Ltd.
Mr. Jignesh Vasavada GAIL (India) Ltd.
Mr. Rajeev Goel Hindustan Petroleum Corporation Ltd.
Ms. Radhika Ojha IOT Infrastructure & Energy Services Ltd.
Ms. Aarshiya Dhody Indian Oil Corporation Ltd.
Ms. Madhuchanda Adhikari Choudhury Numaligarh Refinery Ltd.
Mr. Debasish Mukherjee Oil & Natural Gas Corporation Ltd.
Dr. Rahul Dasgupta Oil India Ltd.
Mr. Deepak Mahurkar PricewaterhouseCoopers Private Ltd.
Journal Coordinators
Editorial BoardEditor : Y. Sahai
Member : A. K. Arora
S.L. Das
S.S. Ramgarhia
O.P. Thukral
Biren Das
Edited, Designed & Published by:
Petroleum Federation of IndiaPHD House, 3rd Floor, 4/2, Siri Institutional Area, August Kranti Marg, New Delhi-110 016
Phone: 2653 7483, 2653 7062, 2653 7069, Fax: 2696 4840,E-mail: [email protected], Website: www.petrofed.org
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Website: www.printempsindia.com
Designed by: Continental Advertising Services
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Petroleum Federation of India6
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Petroleum Federation of India 7
Contents
S. No. Topics Page No.
1 From the Chairman 9
2 DG's Report 10
3 Shri K. D. Tripathi is Secretary, MoP&NG 11
4 CEO Speak 12
by Mr. P. Elango, Managing Director, Hindustan Oil Exploration Company
5 Policy Options for Revenue Neutral GST for Petroleum Products and Natural Gas 14
by Prof. Sacchidananda Mukherjee, Associate Professor, National Institute of
Public Finance and Policy and Prof. R. Kavita Rao, Professor,
National Institute of Public Finance and Policy
6 Tax Holiday Relief by Gujarat High Court 18
by Ms. Neetu Vinayek, Oil & Gas Sector Expert; Mr. Hiten Sutar, Oil & Gas Sector Expert and
Mr. Jigar Haria, Oil & Gas Sector Expert
7 Managing in Times of Volatile Oil Prices 21
by Mr. Sunil Bhadu, Partner and Advisory Leader - Oil & Gas, Ernst & Young LLP
8 Water Resources Management for Sustainable Development 26
by Prof. N. Janardhana Raju, School of Environmental Sciences, Jawaharlal Nehru University
9 Role of Analytics in Security of Operation Technologies 29
by Mr. Vinayak Godse, Senior Director, Data Security Council of India (DSCI)
10 OxyMethylene Ethers: Diesel Additives for the Future 31
by Dr. Chanchal Samanta, Manager (R&D), BPCL; Dr. Ankur Bordoloi,
Scientist, IIP Dehradun; Dr. R. K. Voolapalli, Chief Manager (R&D), BPCL;
Dr. Jim Patel Scientist, CSIRO, Australia
11 Offshore Renewables 40
by Capt. D. C. Sekhar, Managing Director, AlphaMERS Private Limited
12 Job Hazard Analysis & Escalation Matrix 42
by Mr. V. V. R. Narasimhan, Head-Corp. HSE, Hindustan Petroleum Corp. Ltd.
13 Improving Corrosion Assessment and Monitoring 46
by Mr. Ulhas Deshpande, Business Leader, Advanced Solutions, Honeywell Process
Solutions and Mr. Jaideep Bhattacharya, Consultant, Advanced Solutions, Honeywell
Process Solutions
14 Pre Reformer Catalyst for Hydrogen Plant 48
by Mr. Sanjeev Mehta, General Manager - BU Syngas Catalysts,
Sud-Chemie India Pvt. Ltd. and Mr. Chetan Bhola, Assistant Manager - BU Refinery Catalysts,
Sud-Chemie India Private Limited
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Petroleum Federation of India8
Contents
15 Optimisation of Visbreaker Unit 51
by Mr. Debasis Bhattacharyya, Dy. General Manager (RT-I), IndianOil (R&D Centre);Mr. Satheesh V. K., Sr. Research Manager, IndianOil (R&D Centre); Mr. B. V. Hariprasad Gupta,
Research Manager, IndianOil (R&D Centre) and Mr. G. Saidulu, Research Manager,
IndianOil (R&D Centre)
16 Compressor Anti Surge System Trouble Shooting 57
by Mr. Mukesh K. Shivhare, Engineer, EIL; Mr. Shailendra Kumar,
Dy. Manager, EIL: Ms. R. V. Sreevidya, Dy. Manager, EIL; Mr. P. Narendra Kumar,
Dy. Manager, EIL and Mr. S. R. Singh, Dy. General Manager, EIL (R&D Centre)
17 Oxygen Enrichment for Air Oxidations in Chemical Industries: Overcoming Limitations 63
by Mr. Bernhard Schreiner, PhD, Senior Expert Chemical Process, Linde AG; Mr. Diganata Sarma,Head of Applications & Market Development, South Asia and ASEAN, Linde Gas Asia Pte. Limited
and Mr. Yogesh Desai, Manager-Application Sales (Chemical & Environmental), Linde India Limited
18 10 ppm Sulfur Gasoline Opportunity Analysis 70
by Ms. Delphine Largeteau, Senior Technologist-Mktg. Associate, Axens; Mr. Jay Ross,
Senior Technology and Mktg. Manager, Axens and Mr. Larry Wisdom, Mktg. Executive,
Heavy Oils, Axens
19 Make in India: Successful Indigenous TGTU 75
by Mr. Kaushik Ghosh Mazumdar, Deputy Manager (R&D), EIL; Mr. D. K. Sarkar,
Deputy General Manager (R&D), EIL and Ms. Vartika Shukla, General Manager (R&D), EIL
20 Overcoming Barriers to Entry into Petrochemical Markets 79
by Mr. Matthew Lippmann, UOP LLC, a Honeywell Company and
Mr. Soumendra Banerjee, UOP IPL, a Honeywell Company
21 DeNOx Technology For Refiners For a Green Footprint 86
by Mr. Sachin Panwar, Business Development Manager, Haldor Topsoe India Pvt. Ltd.
and Mr. Raman Sondhi, Vice President, Haldo Topsoe International A/S
22 Olefins Technology Options to Meet Uncertain Market Conditions 92
by Mr. Sagar Nawander, Associate Technical Professional, KBR Technology;
Mr. Sourabh Mukherjee, Chief Technical Leader, KBR Technology andMs. Tanya Aggarwal, Associate Technical Professional, KBR Technology
23 Trickle Bed and Slurry Bed Reactors in Refining Industry 96
by Ms. Megha Aggarwal, Sr. Engineer (R&D), EIL; Mr. Vijay Yalaga, Dy. Manager (R&D),
EIL; Dr. R. N. Maiti, Dy. General Manager (R&D), EIL and Ms. Vartika Shukla,
General Manager (R&D), EIL
24 Members' News in Pictures 104
25 Events 111
S. No. Topics Page No.
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Petroleum Federation of India 9
From the Chairman
For the first time, India is leading the growth
chart of major economies in the World Bank's
mid-year Global Economic Prospects report.
The World Bank has projected a growth of 7.5% this
year for the country with new reforms improving
business and investor confidence, and attracting
new capital inflows. The Vice-Chairman of the NITI
Aayog expects the growth rate to accelerate to 8%
in the current fiscal with the economy surpassingUS$ 3 Trillion in less than five years.
Global growth, however, is expected to be 2.8% in
2015, which is lower than anticipated in January this
year. It is likely to expand by 3.3% in 2016 and 3.2%
in 2017, broadly in line with the Bank's previous
forecasts. Developing countries are projected to
grow by 4.4% this year, 5.2% in 2016 and 5.4% in
2017. High-income countries are projected to growby 2.0% this year, 2.4% in 2016 and 2.2% in 2017.
According to the World Bank, lower prices of oil and
other strategic commodities have intensified the
slowdown in developing countries, many of which
are heavily dependent on commodity exports. While
commodity importers are benefiting from lower
inflation, fiscal spending pressures and import costs,
low oil prices have so far been slow to spur moreeconomic activity because many countries face
persistent shortage of electricity, transport, irrigation
and other key infrastructure services; and severe
flooding and drought caused by adverse climate.
Looking ahead, says the World Bank, the growing
importance of unconventional oil production and
technological innovation could help keep oil prices
low with substantial volatility around a new
equilibrium level.B. Ashok
Chairman
The prospects of the price of oil remaining low for a
considerable period of time bodes well for India,
which is on a new cusp of growth and a big economic
leap. In the oil & gas sector, during the past one
year, the Government has brought in a new gas
pricing formula, deregulation of diesel prices, anddirect transfer of subsidy on domestic LPG into the
bank accounts of consumers. There is also work-in-
progress on several issues in other areas such as
oil exploration & production, setting up of a national
gas grid, and development of city gas distribution
networks.
The Government's aim of a double-digit growth will
be substantially aided by the economic reforms inthe offing, particularly a comprehensive Goods &
Services Tax. According to leading economists, the
maximum benefit of GST can be derived by not
leaving out any goods or services from its ambit.
This is particularly relevant for the oil & gas sector,
which impacts a wide range of economic activities.
Non-inclusion of any group of petroleum products
would result in cascading of taxes in several sectors.
The industry is hopeful that GST, on introduction, will
comprehensively cover all goods and services,
including petroleum products.
With such reforms in the offing, we can all look
forward to accelerated economic growth.
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Petroleum Federation of India10
Asian countries are making a vital contribution
to achieving global sustainable energy goals,
according to a new World Bank report titled
Progress towards Sustainable Energy: Global
Tracking Framework 2015. Asia accounted for about
60% of the global progress on energy access and
clean energy objectives during 2010-12, says the
report, contributing well beyond its share of global
population and energy consumption. The report
highlights that, among other issues, India,
Philippines and Bangladesh were the strongestperformers on electricity front and added about four
percentage points to electricity access rates. Asia's
progress, however, on reducing the energy intensity
of its economies with a compound annual growth
rate of 1.3% annually - a commonly used measure
of energy efficiency - lagged behind the global
average of 1.7%. On expanding modern renewable
energy, from sources like solar, wind and
geothermal, Asia's performance was particularly
strong. Whereas globally, consumption of modern
renewable energy grew by 4% per annum during
2010-12, in Asia that growth was almost twice as
fast at close to 8%.
Developing countries have poured in bulk
investments of USD 63 billion for solar technologies
and USD 58 billion for wind technologies - matching
figures of investment by developed nations, says
the renewables 2015 Global Status Report, released
during the recent Asia Clean Energy Forum 2015 at
Manila. Between 2013 and 2014 nearly half of the
total USD 270 billion global investments on
renewable energy were from developing countries,
according to data from the UN Environment
Programme.
In developing Asia, two countries figured in the
global top 10 list of countries generating the most
number of jobs in the renewable energy sector: India,
with 437,000 jobs and Bangladesh, with 129,000
jobs, noted the report issued by the Renewable
Energy Policy Network for the 21st century.
Climate change, however continues to be a matter
of concern and a peak in global energy - related
DG’s Report
A. K. Arora
Director General
emissions could be achieved as early as 2020 and
at no net economic cost, according to the
International Energy Agency's new World Energy
Outlook Special Report on Energy and Climate
Change. Increasing energy efficiency in the industry,
buildings and transport sectors; reducing use of the
least efficient coal fired power plants; increasinginvestment in renewable energy technologies in the
power sector from USD 270 billion in 2014 to USD
400 billion in 2030; reducing methane emissions in
oil & gas production; and gradual phasing out of
fossil fuel subsidies to end-users by 2030 are some
of the IEA recommendations for achieving a peak in
global energy released emissions as early as 2020.
The last recommendation needs careful
consideration since the cost of energy subsidies in
2015, according to a recent IMF Working Paper, is
USD 5.3 trillion or 6.5% of global GDP. Earlier work
by IMF also shows that these subsidies have
adverse effects on economic efficiency, growth and
inequality. Emerging Asia accounts for about half
of the total energy subsidies, while advanced
economies account for about a quarter. The largest
subsidies in absolute terms, are in China (USD 2.3
trillion); United States (USD 699 billion); Russia (USD
335 billion); India (USD 277 billion), and Japan (USD
157 billion). The subsidies for the European Union
at USD 330 billion are also substantial.India has already made significant headway in
reducing energy subsidies by making diesel prices
market determined and direct benefit transfer for
domestic LPG cylinders. Measures are underway
to tackle the subsidies on PDS kerosene and further
rationalize subsidy on domestic LPG cylinders.
The determined actions by the Government in this
regard are bound to bear fruit.
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Petroleum Federation of India 11
Shri Kapil Dev Tripathi is Secretary to the Government of India in the
Ministry of Petroleum & Natural Gas. He took charge in June, 2015 on the
superannuation of Shri Saurabh Chandra.
A 1980 batch Assam-Meghalaya cadre officer of the Indian Administrative Service
(IAS), Shri Tripathi was earlier Secretary, Department of Public Enterprises. With
35 years' experience in Public Administration he has held important positions in the
Government of India in various Ministries/Departments like Rural Development; Steel
& Mines; Tourism; Chemicals, Petrochemicals and Pharmaceuticals; Public Enterprises,
etc. He also served as Secretary in the Central Vigilance Commission, which is the
premier Integrity Institution of the country.
Shri Tripathi is a post graduate in Physics from the University of Allahabad and did his
Masters in Business Administration in 1994 from the University of Ljubljana, Slovenia.
While posted in the North Eastern State of Assam, he served in different capacities in
Departments of Agriculture, Fisheries, Rural Development, Personnel and General
Administration, Home & Political, Industries, etc. In addition, in the Sub Division and
Districts, he functioned as Assistant Commissioner, Sub Divisional Officer, Project
Director of District Rural Development Agency and Deputy Commissioner.
Shri K. D. Tripathi is Secretary, MoP&NG
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Petroleum Federation of India12
CEO Speak
Transforming Through Technology
P. ElangoManaging Director
Hindustan Oil Exploration Company
When we reflect on the history of oil and
gas industry, it is clear that every major
growth in production is triggered by
breakthroughs achieved in either Discovery or
Recovery technologies. Whether it's rotary drilling
and reflection seismology of the 1940', to
development of 3D seismic in 1980's, to the fusion
of fracking with horizontal drilling that exploded in
shale revolution, technology has been the sole driver
for global oil production to grow from 5 million BOPD
in the 1940's to close to 90 million BOPD now.
Despite this, do we as a country, sector, company
or as individuals holding leadership responsibilities
pay the required attention to technology and its
adoption. The answer, to my mind is No. I am not
going to get into why we don't do it and but would
rather focus on what would happen if we do it.
In the context of India, where over 75% basins are
yet to be fully and thoroughly explored, where ~
130 billion barrels of resources fall in " yet -to - find "
category, where one third of basins are yet to be
explored by any one and where 96% discovered
resources are from just 6 of the 26 basins,
deployment of technology holds the key to unlock
the hydrocarbon potential.
Specifically, the statistics on Mesozoic rocks tell a
compelling story. While all over the world around
54% of world oil production and 44% of world gas
production is contributed by Mesozoic rocks, its
contribution in India is negligible, despite being
home to 400,000 square kilometers Mesozoic basin
area.
I often relate oil and exploration to search for sighting
a tiger. Both need passion, patience and
perseverance. And just because you saw pug marks
does not mean you will be lucky enough to sight the
tiger. It looks like our early explorers for oil went after
pug marks that were more prominent that led themto discover oil and gas in Assam, Cambay, Mumbai
High, Cauvery and KG basins, and these are mostly
from younger and shallower rocks. In that trail all
the Mesozoic pug marks seem to have been left
behind. It's time to retrace the path and take a
re-look at them with the benefit of advances in
technology. This should be done, and I would add,
on a mission mode.
The other insightful statistic is that if the global
average oil and gas recovery can be increased from
its current level of around 35% by one percent, the
increased production is sufficient to meet the global
oil demand for over one year. And increasing the
average recovery factor from 35 to 50% (which
prudently managed fields around the world are able
to deliver with application of recovery technology)
would add a whopping 1 trillion barrels to provenreserves. Such is the power of Enhanced Oil
Recovery (EOR) technology, and India still lags
behind in embracing it widely. Its heartening to note
that, both in Barmer and Cambay basins, Cairn and
ONGC have taken the lead to implement EOR in
their respective basins.
Similar to its independent foray in the world of space
technology, India was forced to develop its maiden
offshore oil and gas discovery on its own, without
partnership with any International Oil Company. The
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Petroleum Federation of India 13
engineering talent of ONGC took up the challenge
head on and developed the Mumbai High field to
world class standards. Similarly, a large oil and gas
field with a billion barrel recoverable resource (valued
over $ 100 billion) was developed in a desert region
and a deep water gas development was executedin a record discovery-to-delivery-time by the private
sector players. India is also home to the world's
longest heated crude oil pipeline system of 600 km
length that generates 32mw of power to continuously
heat and keep the waxy & high pour point crude
flowing in the pipeline.
In the sub-surface front, advanced spectral
decomposition technology (SDT) has been usedsuccessfully in a shallow water offshore filed, whose
main reservoirs middle miocene are overlaid by thin
late miocene reservoirs. These are thin and isolated
reservoirs that are difficult to map using conventional
techniques. SDT enabled computation of attributes
at different frequencies and used 3D visualisation
environment to highlight the thin channels which
were subsequently drilled to achieve incremental
production.
4D seismic is an advanced method of acquiring,
processing and interpreting repeated 3D seismic
surveys at different time stamps. 4D technology
brings fourth dimension (time) for identifying areas
of bypassed oil reserves. A 4D OBC seismic survey
was executed for the first time in India, targeting by
passed oil. This enabled Ravva oil and gas field to
achieve a recovery rate more than 50%, while theaverage for other fields in India is less than 35%.
Despite a successful 4D seismic survey in one field,
3D seismic surveys have so far been conducted only
in 15% of the total area. This indicates the scope of
opportunity to deploy such discovery technologies
in India.
All over the world, the advances in Big Data Analytics
powered by developments in Artificial Intelligence
are leading to the construction of smart wells, and
digital oil fields on a scale that our industry has never
seen before, and these are setting new bench marks
in recovery rates. Today, High Performance
Computing is aiding Geologists and Petroleum
Engineers around the world to play their game of
poker with nature from a position of strength. A Terabyte of data is being processed from a single well
on a single day!
But where are we as a Nation, Sector, Company and
Individual.
In the corporate world, for anything to happen,
everything has to begin at the top. When CEO's
make strong commitment and walk the talk on
Safety, a culture of safety gets nurtured in an
organization. And the Indian oil and gas industry has
seen significant progress in companies adopting
safe practices in their operations and improving their
track record on safety. A similar awareness about
the significance of technology and the potential it
holds to change the fortunes of companies, sector
and our country needs to be created. I firmly believe
only technology can transform our sector and ourcountry.
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Petroleum Federation of India14
Policy Options for RevenueNeutral GST for Oil & Gas
Prof. R. Kavita RaoProfessor
National Institute of Public Finance and Policy
Prof. Sacchidananda Mukherjee Associate ProfessorNational Institute of Public Finance and Policy
India is working towards the introduction of a
comprehensive Goods and Services Tax (GST)
regime covering both the Centre and the States.
The rationale for this proposed reform is twofold:one, to expand the tax base available for taxation
for each level of government, and two, to reduce
cascading prevalent within the economy. The
proposed design for GST however keeps crude
petroleum, natural gas, and some petroleum
products outside the purview of GST (The
Constitution (One Hundred and Twenty-Second
Amendment) Bill, 2014) in the initial stage. Mukherjee
and Rao (2015) explore some alternative designs
for GST, within the constraints with which
governments work, i.e., reducing cascading,
keeping prices in check and maintaining revenues.
1. The study suggests alternative design of GSTwhere tax cascading goes down and prices falland the Government revenue remainsunchanged.
2. Substantial reduction in cascading of taxes is
observed for a shift from baseline to alternativescenarios and tax system becomes cleaner.
3. Elimination of cascading of taxes will result inrising export competitiveness of Indianindustries in the international markets.
4. In all alternative designs of GST, the pricesacross the sectors either remain unchanged ordecline
5. Dismantl ing the administered pricing
mechanism for petrol and diesel along withintroduction of comprehensive GST forpetroleum products benefits both upstream anddownstream sectors.
6. Non availability or partial availability of input taxcredit will result in stranded costs for somesectors (where direct use of out of GST itemsare high) but the costs will be spread across allsectors of the economy, through sectoral inter-linkages.
If crude petroleum, natural gas, petrol, diesel, and
aviation turbine fuel are kept out of GST, it would
result in cascading. Since, petroleum products play
an important role in India's energy use, and are useddirectly and/or indirectly as inputs in most sectors,
the proposed design would result in cascading in
sectors of the economy. The study captures the
degree of cascading across 48 sectors under
different scenarios and explores alternative policy
options to phase out under-recoveries of oil market
companies on account of sales of diesel and petrol
under the administered pricing mechanism.
However, bringing these goods into the GST regime,
without any other changes in the economy, would
imply that GST has to be levied at higher rates for
revenues to be protected.1 Introducing GST at higher
rates would make the reform more difficult to
implement. The solution for this knot lies in making
reforms of pricing of petroleum products
coterminous with introduction of GST reforms.
1The provision of subsidy (or administered pricing) reduces prices of petroleum products and at lower prices a higher tax rate is required to meet a certain revenue target. Subsidy adjusted tax rate on petroleum products is expected to be lower than the nominal tax rate and the study takes into account thisdivergence by suitably adjusting the tax rate.
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Petroleum Federation of India 15
In India, crude petroleum is predominantly imported,
where imports constitute about 81 per cent of total
availability. In the absence of price control, it is
expected that volatility in international crude oil prices
as well as in exchange rate would put pressure on
domestic prices of refined petroleum products. Toprotect end users from high and fluctuating prices,
the government implements some price control
measures - the present pricing regime does not allow
full and instantaneous price pass through for a few
petroleum products (PDS kerosene, domestic LPG,
diesel and petrol). This results in under-recoveries
for oil marketing companies (OMCs).2 The
government has not been providing compensation
to OMCs for such under-recoveries in sales of diesel
and petrol.
Given that the country is working towards the
introduction of a comprehensive GST regime,
Mukherjee and Rao (2015) explore alternative
configuration of the tax regime, with specific
reference to petroleum products and evaluate the
extent of cascading under each of these. The study
also explores the configuration of revenues and
prices resultant from alternative tax/ subsidy regimes
to understand whether elimination of price control
in addition to streamlining the tax regime could be
feasible, given the multiple objectives of reducing
cascading, keeping a check on prices and
protecting revenues.
Alternative Designs of GST
The paper shows that with the proposed regime of
taxation for petroleum products and natural gas in
the GST, there will be cascading across sectors; with
the degree of cascading varying across the sectors
depending on direct and indirect uses of these out
of GST inputs. The extent of cascading is non-
negligible: some sectors with considerable export
presence are shown to be facing tax cascading of
over 2 percent of value of output which could be
detrimental for competitiveness in international
market. Sectors having substantial presence in
India's export as well as facing tax cascading are -
metallic minerals, textiles (including apparels),
rubber and plastic products, petroleum products,
chemicals, ferrous and non-ferrous basic metals,
metal products (excluding machinery), machinery
and machine tools (including tractors & agri.
implements), electronic and communication
equipments, all transport equipments (excluding
motor vehicles other than 2 wheelers).
The study presents some alternative designs of
taxation, without compromising on revenue
considerations of government. For comparing the
alternative scenarios, it is assumed government gets
the same total tax incidence as in the baseline
scenario.3 The tax rate on one or more commodities
is adjusted to ensure revenue neutrality. Here it
should be noted that revenues under all alternative
scenarios are derived under the assumptions that
all economic activity in a taxed sector will be subject
to tax, i.e., there are no turnover based exemptions
and there is full compliance. While these are strong
assumptions, the Input-Output framework adopted
for the study does not allow for further calibration to
incorporate these structural features of the tax
system. Further, this framework does not permit
calculation of revenues for Central Government and
State Governments separately.
The study considers proposed GST design as the
baseline. Since the revenue streams from the
proposed GST regime are not yet known, authors
estimate total revenues that could be derived from
the economy provided all economic activity is
subject to tax.
2
Gradual increase in price of diesel, allowing full price pass through of petrol (since 26 June 2010) and continuous fall in crude oil prices in international market, helped government to wipe out under recoveries of OMCs on account of sales in petrol as well as diesel (since 19 October 2014). Unlike petrol, policy option for diesel subsidy is still open.
3Total Tax Incidence = Direct Tax Incidence + Tax Cascading
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Petroleum Federation of India16
Baseline and alternative policy scenarios are as
follows:
Baseline Scenario (Proposed Design of GST):
Natural Gas, Crude Petroleum and Petroleum
Products are out of GST. Goods as well as services
sectors attract harmonized tax rate of 20 percent
and there are some exempted goods and services.
Partial input tax credit (ITC) is available for petroleum
product sector and for other sectors which use
petroleum products and are under GST regime.
There are under-recoveries of OMCs on account of
sales of diesel and petrol below the desired market
prices and the Government provides full
compensation.
Scenario 1 - Proposed Design of GST with no
under-recoveries in petroleum sector: The tax
structure remains same as baseline. However, it is
assumed that OMCs charge the desired market
price and there are no under-recoveries on account
of sales in diesel and petrol. In other words, in this
scenario government allows full price pass through
for diesel and petrol.
Scenario 2 - GST covering petroleum refineries
with subsidy in place: In this scenario, natural gas,
crude petroleum and petroleum products are
brought under the GST system. This would mean
that both for natural gas and crude petroleum, the
taxes on inputs would be set off and similarly other
sectors will get full ITC for purchase of natural gas
and crude petroleum as inputs. Further, for refineries,
there will be full ITC available. Full ITC for purchase
of petroleum products as inputs by other activities
however is not allowed. Goods as well as services
sectors attract harmonized standard GST rate of 20
percent (including natural gas and crude petroleum)
and there are some exempted goods and services.
Petroleum products attract a differential tax rate
(higher than the standard GST rate). Compensation
on account of under-recoveries of OMCs is providedby the Government.
Scenario 3 - GST for Petroleum Refineries without
petroleum subsidy: The conditions of this scenario
remain same as Scenario 2, except that there is no
under-recovery of OMCs on account of sales in
diesel and petrol. The present input tax credit (ITC)
rules for use of refinery products continues.
Scenario 4 - GST for Petroleum Refineries with
Additional Regulatory Levy on Petroleum
Products without Petroleum Subsidy: This is an
extension of Scenario 3, except that full ITC is allowed
up to standard GST rate for purchase of petroleum
products as inputs. In other words, the tax on
petroleum products is assumed to have two
components, a GST and a non-rebatable levy. Inthis scenario, the non-rebatable levy is calibrated to
satisfy revenue neutrality.
Scenario 5 - Comprehensive GST with uniform
rates of tax and with no petroleum subsidy: The
conditions of this scenario are similar to Scenario 3,
except that full ITC is allowed for purchase of
petroleum products as inputs for sectors subject to
GST. In this scenario, instead of a special tax on
petroleum products we estimate a standard GST
rate that will maintain revenue neutrality of the
governments.
The Revenue Neutral Rates (RNRs) for the alternative
scenarios are the rates which yield the same
computed revenues as the baseline scenario for the
study, i.e., the revenue subsequent to introduction
of proposed GST. It should be noted that these would
correspond to the total revenues for Centre and
States put together, but would not incorporate the
effects of specific features such as exemptions,
thresholds, differential tax rates, and less than full
compliance etc. In all of the policy options explored
in the study, the estimated RNR is within the realm
of reasonable and feasible, especially when
compared to the present rates of tax which are
considered as the benchmark (Table 1).
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Petroleum Federation of India 17
Subsidy Scenario Natural Crude Petroleum Electricity Tax exempted Other
Gas (%) Petroleum (%) Products* (%) (%) Goods Goods &
& Services(%) Services (%)
With Baseline 17.00 2.00 40.00 5.00 0.00 20.00
Subsidy Scenario
Scenario 2 20.00 20.00 48.00 (RNR) 10.00 0.00 20.00
Without Scenario 1 17.00 2.00 29.00 (RNR) 5.00 0.00 20.00
Subsidy
Scenario 3 20.00 20.00 36.00 (RNR) 10.00 0.00 20.00
Scenario 4 20.00 20.00 47.00 (RNR) 10.00 0.00 20.00
Scenario 5 23.00 23.00 (RNR) 23.00 (RNR) 10.00 0.00 23.00 (RNR)
(RNR)
Notes: *-Petroleum Products includes Motor Spirit (also known as Gasoline/ Petrol), High Speed Diesel and Aviation Turbine Fuel and all other Petroleum Products. Separate Revenue Neutral Tax Rates are not calculated for the following two baskets - a) MS, HSD& ATF and b) other petroleum products. Input tax credit availed by refineries are taken into consideration in this analysis.
Source: Mukherjee and Rao (2015)
Table 1: Alternative Scenarios and Revenue Neutral Rates
The study suggests two alternative designs of GST
(Scenario 3 and 4) where there is no price regulation
for petrol and diesel, and petroleum products,
including natural gas, crude petroleum and electricity
are brought under the GST. In scenario 3, the presentinput tax credit (ITC) rules for use of refinery products
continues, and in scenario 4, on these products, full
ITC upto standard GST rate is allowed, beyond which
it attracts a non-rebatable levy.
The results also show that in all the alternatives
considered, the prices across the sectors either
remain unchanged or decline (except for tax
exempted sectors). In one of the scenarios, the
announced rate of tax on petroleum products is even
lower than the rates considered in the baseline
scenario (Scenario 3). These results suggest that
there is little ground for separating out petroleum
products for special treatment by keeping them out
of the base for GST. GST reforms implemented
alongside decontrolling product prices would
provide an interesting opportunity to reform without
worries about price rise.
References
Mukherjee, Sacchidananda and R. Kavita Rao (2015), "Policy options for including petroleum, natural gas and electricityin the Goods and Services Tax", Economic and Political Weekly, Vol. 50, No. 9, pp. 98-107 (28 February 2015).
The Constitution (One Hundred and Twenty-Second Amendment) Bill, 2014, Bill No. Bill No. 192-C of 2014, As Passedby Lok Sabha on 6-5-2015. Available at: http://www.prsindia.org/uploads/media/Constitution%2012
2nd /Constitution%20(122)%20as%20passed%20by%20LS.pdf
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Petroleum Federation of India18
Neetu VinayekOil & Gas Sector Expert
Hiten SutarOil & Gas Sector Expert
Tax Holiday Relief by Gujarat High Court
Jigar HariaOil & Gas Sector Expert
1Niko Resources Limited vs Union of India [ 2015 ] 55 taxmann.com 455 (Guj)
This tax holiday benefit was extended by the Finance
Act (No.2), 2009 to the undertakings engaged incommercial production of natural gas in blocks
licenced under the VII round of bidding under NELP
and under IV round of bidding for award of
exploration contracts for Coal Bed Methane blocks,
if these undertakings began commercial production
on or after 1 April 2009.
Further, an explanation was added to Section 80IB(9)
of the Act by the Finance (No. 2) Act, 2009 statingthat all blocks licensed under a single contract, which
have been awarded under the NELP or in any other
prescribed manner, shall be treated as a single
'undertaking' for claiming tax holiday.
Controversy and the Decision of
the High Court
Whether the term 'mineral oil' includes 'natural
gas'
The taxpayers producing natural gas claimed a tax
holiday by treating the production of natural gas as
production of 'mineral oil'. It was contended by the
taxpayer that the Production Sharing Contracts
('PSCs') entered into by the Government of India
provide for benefit under Section 80IB(9) of the Act
for the production and refinement of petroleum.
Recently, the Gujarat High Court1 dealt with
important issues in connection with taxholiday claimed by the exploration and
production companies in the oil and gas sector
under Section 80IB(9) of the Income-Tax Act, 1961
('the Act') and has provided major relief to these
companies. The High Court has provided much
needed clarity on the long disputed matters relating
to the interpretation of the term 'mineral oil' and effect
of the retrospective amendment brought by the
Finance Act (No. 2), 2009 relating to the meaning ofan undertaking.
Before we discuss the decision and its implications,
it will be relevant to summarise provisions of Section
80IB(9) of the Act.
Provisions of Section 80IB(9) and
amendments brought by the
Finance (No.2) Act, 2009
As per Section 80IB(9) of the Act, an undertaking of
a company can claim a tax holiday in respect of
production of mineral oil in India for a period of seven
consecutive years if it has commenced commercial
production of mineral oil, on or after 1 April 1997.
The term 'mineral oil' has not been defined in this
Section. The taxpayers were claiming tax holiday
benefits on production of crude oil and natural gas.
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Petroleum Federation of India 19
2 Association of Natural Gas and others vs Union of India and others, (2004) 4 SCC 4893 Textile Machinery Corporation Limited vs Commissioner of Income Tax (1997) 2 SCC 368
Petroleum has been defined to mean 'crude oil'
including 'natural gas', under the PSC. Therefore,
the intent of the government is to provide a tax
holiday under Section 80IB(9) of the Act to every
entity with which it enters into a PSC, irrespective of
the fact whether it produces 'mineral oil' or 'naturalgas' or both.
However, the tax authorities took a view that the term
'mineral oil' referred in Section 80IB(9) of the Act does
not include natural gas and denied the taxpayers
claim for a tax holiday under Section 80IB(9) of the
Act. The author ities contended that whenever
legislature decided to include 'natural gas' within the
meaning of a Section, it has done so explicitly (fore.g. under Section 42 and 293 of the Act) and by
not defining the term mineral oil under Section
80IB(9), the legislature has not intended to give this
benefit to the production of natural gas.
Decision of the High Court
The High Court, relying on the Supreme Court2, held
that in absence of any specific definition of mineral
oil, any reference to mineral oil in its natural,
commercial and technical sense will include
petroleum products and natural gas. The High Court
also placed reliance on the allied enactments
passed by the Parliament where natural gas is
considered as mineral oil. It was observed that when
one deals with the provisions of the PSC or any
taxing statue, mineral oil is the genus and contains
within its ambit petroleum products and natural gasas its species.
Whether each well or cluster of oilwells will constitute a separate
undertaking for claiming tax benefit
Taxpayers engaged in the business of prospecting
for, exploration and production of mineral oil in India,
enter into a PSC with the Government of India to
develop specified oilfields. The taxpayers based on
the PSC developed a well or cluster of wells over a
period of the contract and claimed tax holiday under
Section 80IB(9) of the Act by treating each well or
clusters of well as a separate undertaking.
Subsequently, an explanation was introduced vide
Finance (No. 2) Act, 2009 stating that all blocks
licenced under a single contract, shall be treated as
a single 'undertaking' and hence the tax authorities
were denying the claim of the taxpayer based on
this explanation which was entered retrospectively.
Decision of the High Court
The High Court relied on the decision of the Supreme
Court 3 for interpreting the definition of the term
'undertaking' and held that commercial production
of mineral oil is carried out from each development
field consisting of a well or cluster of wells thereby
making each field an independent economic unit,
hence is a separate 'undertaking'.
Whether the explanation introduced with
retrospective effect stating that all blocks licenced
under a single contract, shall be treated as a single
'undertaking' is unconstitutional and ultra vires
The High Court observed that the right given to the
taxpayer for claiming 100per cent tax holiday for
seven years was an accrued and vested right and
the said vested right could not have been taken away
expressly or by necessary implication. A person
cannot be derived of the vested right without
following the rule of law. In the case of the taxpayer,
the claim of tax holiday was allowed considering
each well as a separate undertaking by the Income
Tax Tribunal (in the taxpayers own case), and hence
the vested right to claim the tax holiday arose .
Further, it was held that though the legislature is
entitled to depart from the meaning and can define,
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Petroleum Federation of India20
and gas sector. The ruling has brought clarity with
respect to the dispute over claiming a tax holiday
under Section 80IB(9) of the Act for companies
engaged in the business of production of natural
gas.
Further, it has struck down the explanation to the
Section wherein the term undertaking was defined
to include each well within the development field as
single undertaking. Thus, the exploration and
production companies who obtained contracts
before 31 March 2011 can explore the possibility of
claiming a tax holiday on the new wells or cluster of
wells.
Considering the recent outlook of the government
for reducing litigation and getting stability with
respect to tax issues, one will have to wait and watch
to see whether the Tax Department files an appeal
before the Supreme Court against the Gujarat High
Court order.
(The information contained herein is of a general nature and is not intended to address the specific circumstancesof any particular individual or entity. The views and opinionsexpressed herein are those of the authors.)
it has to follow the known process which is approved
by law. The explanation introduced has departed
from the settled interpretation given by various courts
to the term 'undertaking' and is sought to be clarifying
an existing ambiguity. The High Court held that there
is no ambiguity or doubt which needed to beexplained by this explanation. Settled meaning
needs to be altered only through the process of
validation and not through insertion of an explanation
which is not in the nature of validation.
In view of the above, the High Court concluded that
the amendment made in Section 80IB(9) of the Act
by adding an explanation was not clarificatory, but it
takes away the accrued and vested right of thetaxpayer which had matured after the order of the
Income Tax Tribunal and therefore, the explanation
was a substantive law.
The High Court held that this explanation is
unconstitutional and is ultra vires to Article 14 of the
Constitution of India and is liable to be struck down.
Conclusion
The ruling of the Gujarat High Court has given
substantial relief to a company operating in the oil
Do not dwell in the past, do not dream of the future,
concentrate the mind on the present moment.“ “
~Buddha
Very little is needed to make a happy life; it is all within yourself,
in your way of thinking.“ “
~Marcus Aurelius
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Petroleum Federation of India 21
Managing in Times of Volatile Oil Prices
Sunil BhaduPartner and Advisory Leader - Oil & Gas
Ernst & Young LLP
Crude oil prices witnessed a downfall after a
relatively steady period at level above
US$100 per barrel. In fact, very few
predicted such prices when Brent Crude was trading
around US$42 per barrel in January 2009 - following
the collapse of global stock markets just a few
months earlier. However, within a span of two years
prices recovered to US$100 per barrel, reaching the
levels of US$125 per barrel in early May, 2011. Apart
from a few short-term dips witnessed in mid-2012
and early 2013, Brent prices were largely trading
above US$100 per barrel until September 2014.
High prices boosted activities around production of
Shale or Light Tight Oil (LTO) in the US, with US oil
production growing by more than 1 million barrel
per day in each of the last three years. These were
complemented by the geopolitical tensions and
uncertainties in Middle East and North Africa. There
were also unplanned supply outages which
compensated for the modest demand growth of oil
through early 2011 to mid-2014.
However, post June 2014, production outages were
restored in Libya and Iraq. With oil demand facing
weak growth, there was an oversupply of oil, and
soon oil prices began to fall. In times like these, the
role of OPEC has been vital in controlling the oil
prices. However, OPEC voted in late November 2014to maintain production levels, owing to the stand
taken by Saudi Arabia to maintain its market share.
This further accelerated fall in crude prices and by
late January 2015, Brent crude prices had dropped
below US$50 per barrel, more than 60% below their
most recent peak in mid-June 2014. Oil prices have
somewhat recovered and was trading around US$
60 in the end of May 2015.1
As expected, the industry reacted sharply to this fall
in crude prices. There were cuts in Capital budgets
and many companies announced substantial staff
layoffs in early 2015. According to Wood Mackenzie,
oil and gas companies have cumulatively slashed
their 2015 upstream budgets by 24% y-o-y, i.e. by
US$120 billion based on announcements from 116companies. Independents have embarked on
significant spending cuts (around 33%), followed by
NOCs (27%) and Majors (12%). In other words, this
raises the question -is a world where oil is plentiful
and relatively inexpensive - the new normal?
Going Forward - Key Considerations
OPEC supply has exceeded the market demand
since early 2014. OPEC members have resolved to
maintain their production at 30 million barrel per day
and have been successful in doing so till Q1 of 2015
which resulted in an oversupply by around 2.43
million barrels per day2. This situation brings an
interesting perspective for the rest of 2015 and early
2016. It will be interesting to know who will cut the
production first- US LTO producers or the OPEC.
Key considerations for the road ahead are as follows:
1 Source: EIA Report (www.eia.gov)2 Source: OPEC Monthly Oil Market Report, June 10, 2015
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Petroleum Federation of India22
Economic stimulus on various countries
While Oil & Gas industry generally bleeds from the
low oil price scenarios, it has varying impact on the
economies around the world. These can be
categorized in the four broad buckets:
The Big Winners Big winners are countries which have heavy demand for Oil. Countries such as India,
China, Indonesia etc., which are battling high inflation and large oil subsidy bills, will benefit
most from a lower price environment.
Oil Importers Countries which import oil but their demand for oil is not so significant fall into this
category. e.g., Emerging economies and advanced economies with lower oil
demand.
Most advanced economies also gain significantly, although as they have less
dependence on oil for every dollar of gross domestic product their proportionate
gains are smaller.
Oil Exporters Countries where oil export is the key source of income but capital reserves are not
so high. e.g., Russia, Venezuela.
For oil exporters, however, the outlook is darker. Moody's estimates that Russia
and Venezuela will be the hardest hit, since they have "large recurring expenditure
that may be politically challenging to cut".
Large Oil Countries which are dependent on oil production and have huge capital reserves
Producers fall into this category. A large oil producer such as Saudi Arabia, has much greater
fiscal buffers since it saved more than it spent. However, they still may be exposed
if the scenario continues.
The graphic below shows the annualized value of those gains and losses expected in percent of GDP3
3 Source: The Wall Street Journal research
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Petroleum Federation of India 23
Substantial reduction in upstream spending,possibly 20-25%
Conventional: cutbacks in exploration;postponement/deferral of project sanctioningparticularly for high risk high cost projects butlittle impact on short-term production
Unconventional: large cutbacks indevelopment drilling; increasing high-grading ofdevelopment ("sweet spot" focus) - somereductions to production growth
Increased pressure to reduce/control costs-pressure particularly focused on OFScompanies
With increased pressure to reduce and control
costs, Oil Field service providers are the mostaffected. However, this also presents anopportunity to innovate for efficiency and cutdown unnecessary costs.
Tightened access to capital - highly-
leveraged companies may find it difficult to
fund drilling; rising default risks
Due to lower cash flows, lenders will tighten thescrew on such companies and this may lead tolower investments
Increasing consolidation/transaction activity
Large acquisitions like Shell acquiring BritishGas has already kicked off the possibility ofmore such acquisitions being planned in thefuture.
Rising political instability risks in countries
with high fiscal break-even prices and limited
fiscal reserves (e.g., Venezuela, Libya, Iraq,
Nigeria, Russia and Iran)
Such countries may find it difficult to meet thesocial costs which can cause political or civilunrest leading to increased risk of oil supplies.
Iranian nuclear negotiations - possible removalof sanctions could increase supply surplus inthe absence of OPEC/Saudi accommodations
Lifting of sanctions could lead to additionalsupply of 2 million bpd of oil from Iran which
may cause slump in oil prices in case OPEC/ Saudi do not accommodate such rise inproduction.
Given the current oversupply, lower prices will mean
that many projects, which are no longer economic,
may close down or may be deferred. So, while
today's environment may be volatile and far from
'normal', we may once again see a gradual increase
in prices.
After 2015, the medium-term price of crude should
settle into a range that is driven by both
fundamentals and expectations. We see three
possible price paths or scenarios.
1. OPEC adheres to its production ceiling of 30Million barrels per day and there is only modestgrowth in demand. There are no majordisruptions in supply owing to Geopolitical
reasons. Also, US LTO observes only moderateslow down in a production. As a result, thegradual tightening of markets will be drawn-out.These factors would mean that Oil prices willremain in the range of $60 -75 per barrel for thenext several years - US $70 world.
2. In a medium-price scenario, the markettightness becomes apparent sooner and moresharply. Although Demand growth is not so fast,OPEC responds to cut down production slightly.US unconventional oil production faces a
decline due to lower investments. Under thisscenario, oil could be in a range of US$75 toUS$85 per barrel for the next several years - US$80 world.
3. In higher-price scenario, the global economystrengthens and the global oil demandincreases. Geopolitical tensions would meanthat OPEC cuts down production significantly.Growth in US LTO production cannot surpassthe increased demand. These factors couldtrigger oil prices back into the US$85 to US$95per barrel range - US $90 world.
So, while today's environment may not exactly be a
new normal and we may once again see a gradual
increase in prices, the uncertainty is still creating
significant instability.
What it means for companies?
For companies operating in different segments it
would have different implications. The figure belowsummarizes the impact on key segments within the
Oil & Gas industry due to the oil prices.
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Petroleum Federation of India24
possible, and raising equity. Apart from capital
structure the Company should also have a
strong working capital performance. If
necessary, the company could divest assets orbusiness units to generate cash. Additionally,
understanding and managing possible
impairment risks can also be beneficial.
2. Operational Resilience
Companies should understand marginal and
break-even costs and use that knowledge to
challenge operational assumptions. In the
current environment, it is more critical than ever
to deliver capital projects on time and on
Being Resilient
For energy executives managing in this uncertain
world, there are three major areas of focus that canprovide the strength and resilience needed to
weather an extended period of lower prices.
1. Financial Resilience
With the low price scenario, the Companies will
need to manage the balance between lower
cash generation and the obligations/liabilities.
Financial resiliency includes optimizing the
company's capital structure, restructuring the
balance sheet, refinancing certain loans, if
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Petroleum Federation of India 25
budget. Leadership teams must be willing to
take bold action - such as re-scoping, deferring
or stopping outright - any projects that are not
on track. In addition, companies should be
working to re-engineer their business models
to lower their cost base, as well as renegotiatingtheir supply chain and supplier arrangements
to reduce expenses and collaboratively drive
efficiency.
3. Portfolio Resilience
What are the strategic implications and risk
exposures when investment assumptions no
longer hold true? Which assets are
underperforming or are distressed and could
be carved out or divested? Now is a good time
to optimize the company's overall portfolio by
restructuring capital allocations away from high-
cost, lower-return projects. For companies with
stronger balance sheets, it may also be time to
seek out opportunistic acquisitions of challenged
businesses or expand into growth markets. Joint
ventures to share risk capital could also beexplored.
No one really knows how long the conditions we see
today will be "the new normal" in an industry known
for its volatility and cyclicality. Energy markets are
more diversified and complex today and as a result
uncertainty is heightened. But regardless of where
the price of crude settles, energy executives should
strengthen their companies by focusing on financial,operational and portfolio resilience.
(Views expressed are his personal.)
Life isn't about finding yourself. Life is about creating yourself.
“
“
~George Bernard Shaw
Life is not a problem to be solved, but a reality to be experienced.
“
“
~Soren Kierkegaard
Nobody made a greater mistake than he who did nothing
because he could do only a little.“ “~Edmund Burke
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Petroleum Federation of India26
Water Resources Management for Sustainable Development
Prof. N. Janardhana RajuSchool of Environmental Sciences
Jawaharlal Nehru University
The fundamental right to freshwater is not
exercised by about 3.5 billion women and
men across the world according to the UN
World Water Development Report 2014. They often
also lack access to reliable energy, especially
electricity. Water management is therefore, a major
challenge for city planners, builders, architects today,
not just in terms of availability of water but most
importantly its quality. The well-being of humanity,environment and economics ultimately depends on
the management of planet's natural resources. Direct
use of water is concentrated in major sectors of the
economy, which include agriculture, forestry, mining,
energy resource extraction, manufacturing, electric
power production and public water supply. The
demand for water has already increased
tremendously over the years due to an increasing
population, expanding agriculture, rapidindustrialization, urbanization and economic
development and this led to water scarcity in many
parts of the world. Simultaneously, unplanned
development of surface and groundwater resources,
haphazard disposal of municipal and industrial
wastes and application of agricultural inputs has led
to the problem of water quality deterioration/pollution
presenting new challenges on water management
and conservation front.
In most river drainage basins the hydrological cycle
is being modified quantitatively and qualitatively by
human activities such as changes in cropping
pattern, land use pattern, overexploitation of water
storage, irrigation, drainage patterns and industrial
uses. Hence, sustainable management of water and
surrounding environment for a better future has
gained considerable importance in recent years.
Drought, floods and a lack of fresh water may cause
significant global instability and conflict in coming
decades, as developing countries scramble to meet
the demand from exploding populations while
dealing with the effects of climate change. There is
risk of water issues causing wars in coming years
as they create tensions within and between states
and threaten to disrupt national and global food
markets.
Groundwater crisis is not the result of natural factors;
it has been caused by human actions. During the
past two decades, the water level in several parts of
the world has been falling rapidly due to an increase
in extraction by intense competition among userssuch as agriculture, industry and domestic sectors.
The number of wells drilled for domestic and
irrigation (both food and cash crops) have rapidly
and indiscriminately increased. The water
requirement for the industry also shows an overall
increase. Besides, discharge of untreated
wastewater through bores and leachate from
unscientific disposal of solid wastes also
contaminates groundwater, thereby reducing thequality of fresh water resources.
The collection, transport and treatment of water
require energy, while water is used in energy
production and for the extraction of fossil fuels. In
2013, water shortages shut down thermal power
plants in India, decreased energy production in
power plants in USA, and threatened hydropower
generation in many countries, including Sri Lanka,
China and Brazil. The present world's population is
around seven billion and by 2050 it reaches nine
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Petroleum Federation of India 27
billion which requires a 50% increase in agricultural
production and a 15% increase in the already
strained water withdrawals. By 2035, the world's
energy consumption will increase by 35% which in
turn will increase water consumption by 85%
according to the "International Energy Agency". Anaverage of 95 litres of water is required to produce
1 kilowatt-hour of electricity. Vast quantities of water
are being used to develop unconventional fossil fuel
resources (e.g. oil/tar sands and gas production by
fracking) which consume 0.8 to 2.4 barrels of fresh
water for every barrel of oil produced. Hydraulic
fracturing (i.e. fracking) involves the injection of fluids
(fresh water, proppant (i.e. sand) and chemicals)
under pressures great enough to fracture the oil andgas producing formations. Hydraulic fracturing
activities have potential impacts on the quality and
quantity of drinking water resources and competition
for water with other water users sectors (especially
in drought areas) and the disposal of wastewater
generated from hydraulic fracturing.
The decline of water levels and drying up of shallow
wells due to overexploitation, diminishing of waterbodies and increasing number of well structures are
the present day scenario in many parts of India. Due
to urbanization, the soil surface exposed to recharge
gets drastically reduced and therefore natural
recharge gets diminished. Water crisis, created by
declining of water, is further aggravated by the
pollution of water resources. Therefore, the greater
stress is on the remaining available sources of fresh
water resources. India is heading towards a freshwater crisis mainly due to improper management of
water resources and environmental degradation,
which has lead to a lack of access to safe water
supply to millions of people. The reasons for
groundwater depletion are uncertain or erratic
rainfall, reduction of recharge area due to
urbanization, diminishing of surface water bodies,
over-exploitation of groundwater resources and
increase in number of groundwater structures
annually.
Artificial Recharge and
Rainwater Harvesting
Rainwater harvesting and artificial recharge are
made compulsory in the areas where groundwater
development has increased over the annual
replenishment. The most widely practiced methods
of artificial recharge of groundwater employ different
techniques of increasing the contact area and
resident time of surface water with the soil so that
maximum quantity of water can infiltrate and
augment the groundwater storage. The choice and
effectiveness of a particular method is governed by
local hydrogeological (topography and geology) soil
condition and ultimate use.
Rainwater Harvesting Structures in
Urban Areas
Roof-top water collection and recharge: Availability
of rainwater from rooftop is so high in urban areas
and if properly diverted and used, artificial recharge
will not only increase the groundwater but also help
in reducing the water scarcity problems in cities and
towns. Commonly runoff water from rooftop is letoff into the drains. Instead of this, the outlets can be
connected through a pipe to a storage tank and let
into gravel filled trenches, pits or existing wells to
serve as recharge pits.
Storm runoff collection and recharge: Instead of
letting out street or road runoff into drainage canals,
it can be diverted into suitably designed recharge
structures near pavements, parking lots, municipal
parks, play grounds, stadium, airports etc.
earmarking some open spaces exclusively for the
storm runoff collection. Porous pavements can be
utilized for collected road runoff for recharge
groundwater.
Recycling of household water: All the water from
wash basins and bathrooms (other than sewage)
can be let out into the garden or backyard and
excess water can be let into soak pits that canregenerate the groundwater. Thus wastewater can
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Petroleum Federation of India28
be effectively recycled and reused in facilitating
ecological activities.
Rainwater Harvesting Structures in
Rural Areas (Runoff conservation
structures)In areas receiving low to moderate rainfall, mostly
during a single monsoon season, the entire effort of
water conservation of in situ rainfall is required.
Different measures applicable in runoff zone,
recharge zone and storage zone of a watershed
basin are available.
Gully plugs: These are smallest runoff conservation
structures built across small gullies and streamsrushing down the hill slopes carrying drainage of
tiny catchments during rainy season.
Bench terraces: Sloping land with adequate soil
cover can be levelled through bench terracing for
bringing under cultivation. It helps in soil
conservation and holding water on terraced areas
for longer duration giving rise to increased infiltration
recharge.
Contour trenches and bunds: This technique is
adopted generally in low rainfall areas where the
monsoon runoff impounded by putting trenches and
bunds on the sloping ground all along the contour
of equal elevations. The water is intercepted before
it attains the erosive velocity by keeping suitable
spacing between two bunds. The spacing between
two contour trenches and bunds depends on the
slope of the area and the permeability of the soil.Lesser the permeability of soil the closer spacing of
bunds is desired.
Rock-fill dams or nala bunds: A series of small bunds
or weirs are made across selected nala sections
such that the flow of surface water in the stream
channel is impeded and water is retained on
pervious soil/rock surface for longer period of time.
As compared to gully plugs, nala bunds are
constructed across bigger nalas of second order
streams in areas having gentle slopes.
Check dams: It is masonry structure of small length
and low height constructed across a stream to arrest
surface runoff of the stream. The check dam not
only provides surface water for irrigation by gravity
flow but also is useful for artificial recharge for
groundwater development.
Subsurface dams: It is constructed below ground
level in the permeable river beds by digging a trench
across the valley reaching down to bed rock to
harness the base flow in a natural aquifer. An
impervious wall is constructed in the trench and then
the trench is filled with the excavated material. It is
eco-friendly, no submergence of fertile land and no
evaporation losses.
Conclusions
It is essential to promote community and
household involvement in urban (i.e. rooftopcollection) and in rural by undertaking watershed
development program (i.e. improving local waterharvesting systems and afforestation).
Drip and sprinkler irrigation systems are highly
advisable in water scarce areas to conservewater resources.
Change of cropping patterns in water scarcity
areas and cultivating high value but low waterrequiring crops such as pulses (beans, lentils
and peas) and oil seeds.
Recycling and reusing of sewage and industrialwastewater is valuable alternate source of water
supply in urban areas for specific uses such astoilet flushing and gardening.
Strict groundwater legislation to preventoverexploitation of groundwater resourcesi.e. maintaining spacing between wells
Maximizing the water efficiency of power plant
cooling systems and increasing the capacity ofwind, solar power and geothermal energy will
be a key determinant in achieving a sustainablewater future.
Large amount of surplus water in certain river
basins can be diverted to deficit river basins(inter-basin transfer) to meet the water demandin the water scarcity regions.
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Petroleum Federation of India 29
Role of Analytics in Security of OperationTechnologies
Vinayak GodseSenior Director
Data Security Council of India (DSCI)
According to the technology consulting firm,
Gartner, Operation Technology (OT) is a
hardware and software that can detect or
cause a change through the direct monitoring and/
or control of physical devices, processes and events
in an enterprise. Supervisory Control and Data
Acquisition (SCADA) and Industrial Control System
(ICS), build a layer of Programmable Logic Controller
(PLC) and/or Remote Telemetry Units (RTU), whichafter communication networks host a software
typically referred to as OT. Apart from PLC and RTUs
the following protocols/ services are on the internet.
Energy Management Systems (EMS)
DNP3 (Distributed Network Protocol)
Many used form of communication between the
components in process automation systems
serial communication protocol ModBus
Open Platform Communications (OPC) used forexchange of data between multi-vendor devices
and control applications
Distributed Control System (DCS)
Human Machine Interface (HMI/MMI)
Industrial computer network protocol FieldBus
Inter-Control Center Communications Protocol
(ICCP TASE 2)
These technologies were destined to generate
information, which would become relevant in the age
driven by trends such as Big Data. Cost reduction
of sensors and communication, storages and
increasing processing speed using technologies
such as Hadoop, make it practically possible to
experiment with information generated by OTs. Due
to this enormous trove of OT, data available lies atdisposal of many purposes. Security is evolving as
a critical purpose, as more targeted and advanced
attacks, striving to exploit instrumentation systems,
are being witnessed.
OT is different from Information Technology, both, in
application and architectural characteristics. The
data science in Operation Technologies has different
connotations than data science talked in the
contemporary world. Less has been researched in
this area, and as a result, limited expertise is
available. Data from operation technology sensors
would be critical in understanding behavior of
instruments, recording their normal behavior, and
analyzing the pattern during the course of time and
identify abnormalities, if any. These abnormalities
may be due to the exploitation from targeted attacks,
as SCADA systems are becoming a target of security
attacks.
As per a Dell report, Sonicwall saw increase in global
SCADA attacks from 91,676 in 2012,163,228 in 2013,
and 675,186 in 2014. Buffer overflow vulnerabilities
were the primary point of attack against SCADA systems, which control remote equipment and
collect data on equipment performance, accounting
for 25% of the attacks witnessed by Dell. A report of
Industrial Control Systems Cyber Emergency
Response Team (ICS-CERT) reveals that well over
half of the incidents affected the energy (32%) and
the critical manufacturing (27%) sectors. Other
sectors are also climbing the ladder. Transportation,
healthcare, and government facilities sectors eachaccounted for 5-6% of the total number of ICS
incidents. A senior threat researcher with Trend
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Petroleum Federation of India30
Micro, recently found 13 different types of crime ware
versions disguised as Human Machine Interface
(HMI) products such as Siemens Simatic WinCC,
GE Cimplicity, and Advantech device drivers and
other files. Quite interestingly, the attacks appear to
be coming from traditional cybercriminals rather than
nation-state attackers, and are not using cyber
espionage-type malware. On the one hand, SCADA
systems are vulnerable to targeted attacks from
both, state and non-state actors, as witnessed by
malware such as Havex and BlackEnergy. On the
other hand, increasing instances of crime ware -
based attacks are also emerging against the SCADA
system, the intent of which is money making.
These attacks reveal that there would be diverse
vectors used to exploit the systems that find gaps
in engineering operations, sensor network,
communication network, interfaces and command/
host software. At present, OT systems may not have
much visibility in data exchanges across OT
networks and platforms that are vulnerable to cyber-
attacks. Even if the systems have been exploited, it
may remain hidden for a long time. On the other
hand, if IT systems interfacing with the OT systems
get compromised, it would have a cascading effect
on OT systems. There would be 'n' number of
contexts that would come out in play to cause
exploitation. These contexts may remain hidden or
isolated from the system that helps identify security
incidents. Typically, the OT systems are vendor-specific and most likely built on proprietary
technologies. Even if one builds systems to compile
relevant context that is important to take a security
decision, OT systems may not be ready to provide
contextual information required for this decision
making.
The security market is evolving to address these
challenges, with technologies such as content-
aware security appliances that can serve IT and OT
use cases. They support inspection of industrialcontrol system network protocols. They can inspect
network traffic at a granular level, down to the
machine transaction level. The alerts and information
generated by these solutions can be fed to take
decisions apart from the information collected from
sensors and other communication devices. Security
decision making is now critically dependent on the
intelligence gathered from information generating
devices and the solutions that provide context and
content specific information. Relying on internal
intelligence wouldn't serve much of the purpose,
unless it is integrated with external intelligence.
Information collected from thousands of sources
scattered across web, organized and analyzed on
leading indicators of compromises, adds critical
value to security decision making. The security
market is now equipped to provide focused
intelligence involving Operational Technologies.
Together, internal and external intelligence would
help give four type of analytics namely: Descriptive,
Diagnostic, Predictive and Prescriptive. These
pieces would improve security decision making
rather significantly and help manage security
incidents in a predictable manner. Moreover,
intelligence available real-time would help automateresponse to the incidents, thereby reducing impact
of the attack and avoiding exploitations to new
attacks.
(Views expressed here are personal.)
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Petroleum Federation of India 31
The rapid growth of the global economy and
increasing use of transportation fuels has
brought energy security and environmental
issues to the fore. Transportation fuels are currently
produced primarily from crude oil, with alternative
sources viz. natural gas, coal and biomass
contributing only a small share. According to the
Petroleum Planning and Analysis Cell (PPAC), India
is expected to consume 166.9 million tonnes (mt)
of refined fuels in 2015-16 compared with 161.6 mt
in financial year 2014-2015.
Diesel is one of the most widely used transportation
fuels, accounting for more than 40% of India's refined
fuel consumption. The demand for diesel is set to
rise 4.1% in 2015-16 to 71.3 mt, while that of petrol
is expected to increase by 7.2% to 19.7 mt.
Estimates by IHS Automotive predict that by 2019
India will become the world's third-largest passenger
vehicle market, jumping three places from sixthplace in 2015. As a result, the demand for refined
fuels, in particular diesel, will also increase assuming
that global oil prices remain stable at the current
level of between USD 65-70 per barrel.
Unfortunately, an increase in the use of diesel
vehicles does pose significant challenges. The
combustion of diesel in compression ignition
engines produces a range of undesirable pollutants,
which is clearly evident when driving behind a diesel
bus or truck. The particulate emissions we see in
the form of smoke are a particular problem, but otherpollutants, such as NOx, polyaromatic
hydrocarbons and other unburnt hydrocarbons are
also problematic. Particulate matter (PM), smaller
than 10 m, PM10, is emerging as a problem of
particular concern as they penetrate deeper into
human lungs and very small particles can cross
easily into the blood stream. Such particles can carry
toxic PAHs, and are classified as human
carcinogens by the World Health Organisation.Numerous technologies, such as diesel particle
filters and catalytic converters, have been developed
to tackle this problem, however, such devices have
become highly complex and energy intensive and
it is becoming increasingly difficult to make small
improvements in the technology. With the current
engine management and exhaust gas treatment
technologies there is a trade-off between particulate
and NOx emissions, and it is difficult to reduce both
simultaneously, In this context, changing the nature
of the fuel provides an opportunity to break this
trade-off and oxygenated fuels are particularly
promising in this context. Moreover, the production
of oxygenated fuels from locally available alternative
resources, such as coal and natural gas, as well as
from renewable feedstock's, such as biomass, could
play an important role in providing energy security
while simultaneously addressing problems
associated with air pollution.
Dr. Chanchal SamantaManager (R&D)
BPCL
Dr. Ankur BordoloiScientist
IIP, Dehradun
Dr. R. K. VoolapalliChief Manager (R&D)
BPCL
Dr. Jim PatelScientist
CSIRO, Australia
OxyMethylene Ethers: Diesel Additives for the Future
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Petroleum Federation of India32
Fig 1: OMEs are promising diesel additives capable of reducing diesel exhaust emissions
diesel is a major source of air pollution, especially
particulate matter (PM) emissions through soot
formation. Diesel exhaust consists of gaseous, liquid
and solid emissions. Gaseous emission consist of
N2, CO
2, CO, H
2, NO/NO
2, SO
2 /SO
3, HC (C
2-C
15),
oxygenates and organic nitrogen and sulphur
compounds. Liquid emissions include H2O, H
2SO
4,
HC (C15
-C40
) and polyaromatics. Solid emissions are
made up of dry soot, metals, inorganic oxides,
sulphates and solid hydrocarbons. The World Health
Organization has labelled the polar fraction of diesel
particulates as carcinogenic and hence a health
hazard.
Diesel quality in India has improved significantly in
recent years. Diesel sulfur content has been reduced
from 10,000 ppm in most of the country in 1999 to a
maximum content of 350 ppm in 2012. In thirteen
major metropolitan areas the level has fallen from
2500 ppm to 50 ppm in the same time period.
Another factor that has improved over the sameperiod is the cetane number, which has increased
from 45 to 51 nationwide. At present, a total of 63
cities are receiving 50 ppm sulfur diesel. The recent
outcry over worsening air quality in Indian cities has
prompted the government to urge automakers to
move to the advanced Bharat Stage V (10 ppm sulfur
diesel) and VI emission (5 ppm sulfur diesel) norms
a year ahead of schedule, in 2019 and 2023,
respectively. The current diesel specificationsrequired for meeting Bharat Stage IV Emission
norms listed in Table 1.
Diesel and Oxygenates for Diesel
Since its invention by Rudolf Diesel in 1893, the
diesel engine has revolutionized the transportation
sector, due, in part, to its high thermal efficiency.
The fuel efficiency of a diesel engine is generally
between 30-50% higher than that of a gasoline
engine with comparable power output. In other
words, CO2 emissions will be 30 to 50% lower for
the diesel engine for the same amount of power
produced. Since CO2 is a greenhouse gas, a
transition from gasoline-powered engines to diesel-
powered engines seems to be a logical choice to
reduce emissions in the transport sector. However,
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Petroleum Federation of India 33
Table 1: Diesel specifications required for meeting Bharat Stage IV emission norms
Characteristics Unit Specification
Density @ 15°C, kg/m3
kg/m3 820 to 845
Flash Point (Abel) °C Min. 35
Viscosity (Kinematic)@ 40°C cSt 2.0 to 4.5
Pour Point, °C Max. 3 (Winter)
Max. 15 (Summer)
Total Sulphur mg/Kg Max. 50
Polycyclic Aromatic Hydrocarbon (PAH) %wt Max. 11
Cetane Number (CN) Min. 51
Distillation Recovery @ 360°C %v Min. 95
Oxidation stability g/m3
Max. 25
Lubricity wsd @ 60°C, microns Max. 460
Although stringent regulations and fuel quality norms
have improved the diesel quality, with associated
reductions in CO2 emissions, there is still an urgent
need to improve the quality further, especially with
respect to particulate matter emissions. A reduction
in particulate matter emissions is achievable by
modifying the hydrocarbon component of fuels and
also by introducing oxygenates as additives.
Oxygenates are particularly attractive as diesel fuel
additives, as they are capable of reducing exhaustemissions of particulate matter (PM). Examples of
typical oxygenates considered to be suitable as
diesel additives are listed in Table 2.
Table 2: Various types of oxygenates explored as diesel additives
Types of oxygenates General Chemical structure
Alcohols R-OH
Ethers R-O-R
Glycol ethers R-O-R-O-R
Acetals R-O-C-O-R
Esters R-C(=O)-O-R
Carbonates R-O-C(=O)-O-R
Poly(oxymethylene) dimethyl ethers (POMDMEs) CH3-O-(CH2-O)n-CH3
R= hydrocarbon chain, C = Carbon and O =Oxygen
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Petroleum Federation of India34
The following important fuel characteristics need to
be considered when oxygenated substances are
evaluated as diesel additives:
Miscibility with diesel fuel - oxygenates aregenerally polar in nature, which may lead to
compatibility problems when blended withdiesel;
Energy density - the energy content ofoxygenates is lower than that of hydrocarbonfuels resulting in modifications to fuel injectionsystems, larger fuel tanks or reduced range;
Viscosity - low viscosity of fuels may causeleakages, while high viscosity may over-load theinjection system;
Lubricity - some oxygenates require the additionof lubricity agents;
Cetane number - high cetane numbers generallylead to decreased ignition delays and highercombustion temperatures, consequentlyincreasing particulate matter emission andproducts of incomplete combustion, whereasNOx emission may increase;
Particulate matter emissions - such emissionscan be reduced when fuel contains oxygen, but
this is not a linear phenomenon and the natureof functional groups may overrule the effect ofthe oxygen content;
Engine load and emission controlcharacteristics are also important parameters
In short, the optimum diesel oxygenate would be
compatible with unmodified compression-ignition
engines and infrastructure.
Some fundamental factors that promote favourable
oxygenate chemistry include:
Short carbon chains;
Linear carbon chains are better than their non-linear counterparts;
Symmetrical position of oxygen in ethers;
Cetane number, density, viscosity, boiling pointetc. are also important factors.
Low molecular weight oxygenates such as methanol,
ethanol, C4-alcohols, Dimethyl ether (DME), Diethyl
Ether (DEE), MTBE, Dimethoxymethane (DMM)
although explored widely are found not to be suitable
as diesel additives because of their low boiling and
flash points. For example the boiling points of
butanol isomers are in the range of 82-1180C,
significantly lower than the distillation range of diesel
fuel. With butanol addition, the cetane number,
lubricity, viscosity and flash point of diesel fuel may
fall below the mandated requirements as listed in
Table 1.
Dimethyl ether (DME), Diethyl Ether (DEE), MTBE,
Dimethoxymethane (DMM) have been widely
studied as diesel fuel extenders. However, due to
their low boiling points (DEE, 35 0C; DMM, 420C),
these ethers are not used as diesel additives. Acetal
or 1,1-diethoxyethane is a light compound with a
boiling point of 1030C and flash point of only -20 0C.
The best- known diesel oxygenates are fatty acid
methyl esters, FAMEs. Glycerol is formed as a side-
product in FAME production from triglycerdes, and
some glycerol derivatives are potential candidates
as diesel fuel components. However, this aspect is
not under consideration in the present paper.
High molecular weight oxygenates (listed in Table
3) have been explored as potential diesel fuel
additives. Di n-butyl ether (DBE) has a boiling point
of 141 0C, which is almost within the distillation range
of diesel fuel, whereas its flash point is only 25 0C.
Diethoxy butane, which could be produced from
ethanol and butadiene, has a cetane number of 97,
but a flash point of only 45 0C. Diglyme is a good
candidate and it has been reported that a
14.4 vol-% diglyme blend resulted in a 20-40%
reduction in PM emission with a light-duty truck. In
addition, HC and CO emissions reduced without an
increase in NOx, benzene, butadiene, formaldehyde
and PAH emissions. Di-n-pentyl ether (DNPE) has
high cetane number 103-153 and other properties
are diesel-like. DNPE is fully soluble in diesel fuel,whereas solubility in water is low.
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Petroleum Federation of India 35
Table 3: Various types of high molecular weight oxygenates and their properties
Poly ethers with higher molecular weight are
reported as better fuel additives than mono-ethers.
For example, Dibutoxymethane (butylal) is solublewith diesel fuel has boiling point 180 0C and flash
point 620C. The cetane number of butylal is also high
> 74, but a lubricity additive is needed. Diesel-butyl
mixtures reduce engine exhaust opacity without
increasing NOx emission when compared with
diesel fuel. Di-pentoxy methane (DNPM), boiling
point of 2180C and cetane number 97, has also been
reported to be a favourable diesel fuel component.
Particulate matter emissions reduced with fuelcontaining DNPM when compared to diesel fuel.
Tripropylene glycol monomethyl ether (TPGME) is
also one of promising oxygenates from those having
more than 35 wt-% oxygen content. TPGME ismiscible in aromatic diesel and only upto 30 vol%
miscible in paraffinic diesel fuel, but the presence
of water may lead to phase separation.
OMEs: Promising Diesel Additives
Many promising oxygenates reported in the literature
have encountered end-use problems e.g. poor
miscibility with diesel fuel or safety concerns. Inaddition, the economic feasibility of oxygenates may
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Petroleum Federation of India36
be challenging. In order to become an effective
diesel fuel component, an oxygenated compound
must satisfy the following five basic requirements:
Ignition quality: cetane number min 51
Flash point : above 550
C
Boiling point: close to range of 118-340 0C
Solubility in diesel fuel : soluble in diesel fuel
Production : Should be produced from low-cost
widely available feedstock and with simple process
steps
Oxymethylene ethers (OME) or Poly (oxymethylene)
dimethyl ethers (POMDMEs), having the chemicalstructure of CH
3-O-(CH
2-O-)
n-CH
3, are attractive
components for tailoring diesel fuels. OMEs belong
to the group of oxygenates which can reduce soot
formation in the combustion process when added
to diesel fuels. Moreover, OMEs can be produced
from methanol or DME as a basic feedstock.
Methanol can be produced from various non-
renewable and renewable sources, thus offering
attractive flexibility w.r.t feedstocks.
The simplest OME is dimethoxymethane (DMM)
having molecular formula of CH3-O-CH
2-O-CH
3. It
has very low boiling point (42 0C) and cetane number
and is thus not suitable as "drop-in-fuel" diesel
additive. It is, however, a potential additive for
gasoline. A comparison of the properties Bharatstage IV diesel, DME and OMEs is listed in Table 4.
Table 4: Physical characteristics of diesel fuel, DME and OMEs (n =1- 4)
Characteristics Units Bharat Stage IV DME OME OME OME OME
diesel (n=1) (n=2) (n=3) (n=4)
Boiling point 0C 180-390 -25 42 105 156 201
Density, liquid at 150C Kg/m3 820-845 668 867 961 1021 1059
Kinetic Viscosity
at 400 C mm2 /s 2-4.5 < 0.1 0.64 1.05 1.75
Cetane No > 51 55 50 63 70 90
O-content (%) wt % 1.2 34.7 42.1 45.3 47.1 48.2
Volumetric Calorific
Value HU at 150C MJ/I 35-36 18 20 - 19 19
Source: MTZ vol 72, 03/2011
The optimal OME chain length for combustion in a
diesel engine is n=3-5 while the cetane number
should be between 70 and100, higher than that of
conventional diesel which is ca. 55. OMEs have an
oxygen content of between 42-53 wt% and a higher
density as compared to DME and DMM. Therefore,
less volume (to be blended into diesel fuel) is
required to reach a certain oxygen content, resulting
in fuel saving. In addition, OMEs can be used without
changing the engine's infrastructure. It is also
reported that OMEs are not corrosive towards seals
or other polymeric components of the fuel system.
Therefore, OMEs are very attractive as additives for
diesel engines.
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Petroleum Federation of India 37
methylal are converted to POMDMEs. Other
methodologies have also been applied to develop
a commercial process for PODME production. One
example is the production of PODMEs by reaction
of DME and trioxane over an acidic catalyst. Another
process consists of synthesis of methylal by reacting
methanol and formaldehyde followed by reaction
with additional formaldehyde to form POMDME. This
process show poor selectivity due to the production
which reacts to form side-products.
Recently a number of redox catalyst systems based
on Ag, Fe, Re V, Ti Mo and metal oxides have been
explored for the syntheses of POMDME on
laboratory scale. The process involves the oxidationof methanol to formaldehyde followed by acidic
condensation reactions.
OME: Chemistry and Catalysis
OMEs can be obtained from methanol as illustrated
in Fig 2. In this synthetic sequence the intermediates
are methylal (Dimethoxymethane, DMM) and cyclic
trimer metaformaldehyde or 1,3,5-trioxane with theformula (CH
2O)
3. In the first step formaldehyde is
obtained by dehydrogenation of methanol. Various
catalyst systems have been explored for the
conversion of methanol to formaldehyde (Table 5).
The trioxane process consists of the trimerisation of
formaldehyde, generally catalyzed by H2SO
4, and
separation of the product, for example by a pressure-
swing distillation sequence. The preferred
production method for methylal from formaldehydeand methanol is by a heterogeneously catalyzed
reactive distillation. Subsequently, trioxane and
Fig 2: Block flow diagram of the POMDME process chain
Zeolites and acidic ion exchange resins were
exploited as catalyst by British Petroleum for
POMDME production. A range of pre-cursors canbe used, such as methanol, formaldehyde, dimethyl
ether, and methylal, however, the process suffers
from low yields of POMDE3-8 (<10%), and process
complexity. Brønsted acid catalyst such as H2SO
4
or CF3SO
3H has been used by BASF to synthesis of
POMDMEn from DMM and trioxymethylene.
Moreover, they also tried other starting materials,
such as DMM and dimethyl ether. However, product
selectivity was reported to be very low. Recently,researchers from the Lanzhou Institute of Chemical
Physics have developed a new process for the
production of POMDE3-8 based on ionic liquid base
as catalyst and raw material like methanol andtrioxymethylene. In this process, high yield of
POMDMEs (50%) were obtained with good
selectivity for POMDMEs(n=3-8) 70-80%. However,
the process has limitations for higher scale
production due to a complicated purification process
and the expensive and corrosive nature of the
catalyst system. Therefore, it is important to develop
a solid catalyst for the efficient and environmentally
benign process to synthesis POMDMEs atcommercial level.
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Petroleum Federation of India38
Table 5: Reactions and catalysts for OMEs production process chain
publications and patents on OMEs in the last five
years, revealing a renewed interest in OMEs. This is
mainly because of the stringent environmental
regulations worldwide to reduce exhaust emissions.
China's proactive energy policy combined with the
scale of its economy and infrastructure development
is promoting regional as well as global clean energy
related research. As evidence, China's oil companiesand research institutes are very active in this area
as evident by the fact that more than 70% of research
outputs are coming from China. BASF and BP are
also active in the research and development on
OMEs.
Fig 3: Publications/patents trends OMEs (Source: KIT, Germany)
OMEs: Global R&D Scenario
Stringent climate change protection legislation
requires second generation fuel components to
reduce emissions from the combustion of fossil
fuels. The European Union and China have each
made great efforts to reduce emissions from
vehicles. Publications and patents trends with
respect to OMEs from the 1990's to 2014 ispresented in Fig.3 and the R&D contribution of
various institutes on the development of OME
process technologies is presented in Fig 4.
There has been steady increase in the number of
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Petroleum Federation of India 39
compared to DME and DMM. OMEs blended with
diesel fuel can be applied directly in existing diesel
engines without any technological changes and
allow an introduction to the market without
installation of new logistic infrastructure. OME
production based on the renewable feedstocks also
would help to deal with climate change and energy
security challenges. The optimum diesel oxygenate
would be compatible with unmodified compression-
ignition engines and infrastructure. OMEs blended
diesel fuels have the potential of significantly
reducing local emissions as well as global CO2
emissions.
Fig 4: R&D contributions of various companies/institutes on OMEs (Source: KIT, Germany)
Summary
Limited fossil fuels resources, climatic and human
health issues are promoting a shift from conventional
towards more renewable fuels and fuel additives.
The polyoxymethylene dimethyl ethers (POMDMEs)
or OMEs with a chain length of n=3,4, are an
attractive clean alternative to crude oil derived diesel.
OMEs can be easily produced via syn-gas and
methanol from waste biomass or from th recycling
of CO2 by H2. POMDMEs are capable of reducing
exhaust emissions, especially particulate matter
emissions. The low vapour pressure of high
molecular weight of POMDMEs (of n=3-5) and their
miscibility with diesel fuel are a clear advantage
Our prime purpose in this life is to help others.
And if you can't help them, at least don't hurt them.“ “
~Dalai Lama
Help others achieve their dreams and you will achieve yours.
“
“
~Les Brown
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Petroleum Federation of India40
Offshore Renewables
Capt. D. C. SekharManaging Director
AlphaMERS Pvt. Ltd.
Tidal Energy
The maximum tidal range in Gulf of Khambat
at locations like Bhavnagar is almost 10 m.
This is nature's bountiful gift of energy, given
to us day after day, year after year. We can harness
the energy or let it go. Unlike fossil fuels today's
unused resource does not remain for another day.
Much like the empty seats of an aircraft or empty
hotel rooms, today's resource is wasted, tomorrow
is a fresh supply.
The good news is - tides are as predictable as the
rise of the sun or moon. The power yield can be
reliably estimated today, for any given day, few years
later and an assurance given to the utility years in
advance. Unfortunately the tidal cycle, dominated
by lunar forces, does not exactly coincide with the
earth's solar day cycle. Thus the tidal power cycle
does not coincide with our work and demand cycle.
Tidal streams represent a different type of energy
from the tidal rise. This is kinetic energy in a tidal
current, and as the name implies, caused by the
tidal forces. A simplistic solution is placing turbine
in way of the water to convert water stream into
electrical power. It may be emphasized that the
current strength varies in magnitude and changes
direction as per the change of tide. This presents a
challenge to provide a steady power output.
A good optimum is a hybrid system of stored head
of water from rise of tide, supplemented by a turbineplaced in the tide induced currents. The power
output can be smoothened and matched to meet
the demand cycles. It may be important to note that
the plant's rated output will be limited by rise of water
in neap tides even though the generation capacity
during spring tides may be much substantially
higher. The neap tides will see reduced storage head
as well as the reduced strength of the tidal currents.
Most turbines placed in tidal streams must operate
in both directions to cater for flood and ebb flows. Alternatively, they must be able to vary their pitch
(CPP).
Rivers on the other hand present different
opportunities. The flow is unidirectional and the
changes are seasonal rather than daily. The change
in water levels can be large in rivers, adding to the
micro-siting challenges. There is notable benefit in
placing the turbine close to communities on the river
bank to avoid long transmission lines. The siltation
and accretion will present challenges to the stability
of the turbine foundation and flow of water through
such turbines. These are analyzed in detail through
CFD modelling software.
Wave Power
Wave created by wind, is as unpredictable as thewind itself. The 'swell' on the other hand, has its
origins from a disturbance much further and not due
to local winds. Both the wave and swell have a large
energy and can toss a large ship around effortlessly.
Simply put, any object floating on water and
anchored, will move with the waves. The energy of
these movements needs to be converted to usable
forms of energy. There are dozens of possibilities
and models. Most of the models start producingabove a threshold wavelength and have optimum
performance on a certain range of wave length.
These parameters can be configured to the
significant wavelength at the location.
The energy is obviously abundant and is right there.
If not today, mankind will learn in the decades to
come, how to smartly harness this energy. The
energy can be used to power - remote buoys,
unmanned oil platforms, Islands, coastal resorts,coastal communities, lighting requirements of fishing
boats etc. The author's firm has patent applied three
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Petroleum Federation of India 41
designs for harnessing energy from waves, suitable
for different applications.
One of the high profile wave energy converter
models deployed for technology demonstration is
P2 by Edinburgh-based Pelamis. The capacity of
this plant is 750 KW.
'Penguin' is another model for wave power
conversion developed by Wello. This device weighs
1600 tons, is 30 m long, 9 m tall with a draft of 7 m.
This converter produces a continuous output of 160
to 180 kW and peak power outputs of up to 700 kW.
Offshore Wind Farm
The recent developments take the traditional mono
pile fixed (to seabed) turbine to the more futuristic
floating turbines. These floating turbines have few
advantages. One distinct advantage is they take the
theatre of action from 50 m depths to between 150
and 200 m depths, often offering more sea room for
development away from the near shore shipping
traffic and CRZ issues. They also avoid the issues
of visual pollution and turbine noise, close to
communities. They are assembled in ports and wet
towed to location, saving the need for expensive
offshore floating crane operations.
However, the floating turbine designs have to
develop further to limit the wear and tear on the
turbine parts when moving in a seaway. The Author's
firm is working on a particular design aspect of
floating turbine, enabling the conversion to electrical
power at sea level, instead of the nacelle. The
purpose is to reduce weight on top and more
importantly bring maintenance issues to sea level.
This will result in enhanced weather windows formaintenance.
There are two notable projects in floating turbines in
the world. One is 2.3 MW Hywind assembled in
Norway. The turbine draft is very high i.e. 100 m.
The second project is the 2 MW Windfloat from
Principal Power, which is moored off the coast of
Portugal. The floating turbine sizes are large and is
expected to go up to 6MW turbines in the years
to come.
Typically of wind, the resource availability varies and
is unpredictable over short timescales. Thus the
power supply and demand cycles are mismatched
and beg for a buffer or storage capacity that wouldbridge these gaps. This is one area with need for
technology development, i.e. storage of harnessed
energy. Water lift and storage is a popular model
and is more environment friendly than banks of
chemical batteries. The storage capacities can be
increased by increasing water storage capacities.
State policies are the gatekeepers of development
in any sector. Resource assessment studies in this
sector are expensive and at the same time, the
results are very site specific. This begs the question
of what comes first for private investment? Resource
assessment or securing rights to a resource bloc?
Would one invest in detailed study of the site specific
resource without assurance of the right to use? Or
would one apply or bid for the bloc without reliable
data of resource availability. Swiss challenge
proposals are a good answer for such situations.
Besides the obvious competencies in turbines and
electrical systems, some of the other competenciesrequired for offshore energy development are
resource assessments, geotechnical assessment,
offshore logistics, environmental impact
assessments, maritime security etc. The concerns
or objections can come from radar stations, fishing
traffic, shipping traffic, sensitive species habitat,
potential for other resources etc.
It can be safely summarized that the future of energy
is in renewables and a lot of that will come fromoffshore wind and waves, of course, in addition to
our abundant sunshine overland. The economy of
scale and the scale of offshore projects will continue
to get bigger. The development technology and
costs per unit will continue to decrease and compete
with other types of renewables. With our large
coastline, we have something to cheer about in our
not too distant future.
The author's firm (www.alphamers.com) assists resource assessments, provides consultancy in offshore renewable
energy sector and has filed patents in wave energy harnessing devices.
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Petroleum Federation of India42
Job Hazard Analysis & Escalation Matrix
V. V. R. NarasimhamHead-Corporate HSE
Hindustan Petroleum Corporation Limited
In hazardous process industry, the last precursoract to an incident, in most cases, is executed by
the frontline lower echelon person who interfaces
with the work-front. It could be a technician, a skilled
or unskilled worker. This makes it necessary for the
managements to ensure that "the frontline" carries
out its work in a well-established framework of work
planning, adequate knowledge, the right procedures
and that they are kept alive to the safety requirements
of every job. The onus of ensuring that he is provided
with the right tools, right procedures, safe workplace, safe circumstances and right instructions is
on the "Management". The responsibility of
"enforcing" is again on the "Management". The work
processes need to be embedded with safety.
For maintenance and project works in an operating
Refinery, the location hazards are enormous. Every
Plant and offsite location has different scale of
hazards which are encountered as the job activity
interfaces with them. Then there are a set of hazards
which are inherent to the type of work. Hot work,
excavation, elevation work themselves require
trained and well indoctrinated personnel who not
only are proficient but also know what can go wrong.
Next, the equipment they use must be suitable, safe
and fit for use. In addition, the methodology of
execution must be reviewed to be safe and suitable
to the site. For the Management, the challenge is
how all this is to be "ensured"?
The most effective approach is to have a clearlywritten down "management process". However, this
is only the first step. The crucial part is to ensure
that such process is actually implemented as
envisaged. The personnel need to be made well
versed with it. At the same time, while designing the
management processes, it is necessary to identify
the key requirements to ensure safe decision making
at every level, assurance of their planning and
monitoring during the execution. Based on this
identification, appropriate features should be
incorporated in the management process.
Embedding such features enhances the "preventive"
approach and delegates the responsibilities of
performing the specific tasks to the appropriate
different levels in the Management. Making iteffective in implementation could be quite
challenging. However, with indoctrination and
relentless pursuit it can be fully achieved. For the
context of this narrative, the reference is to the "Work
Permit Manual".
Two such features which should be incorporated in
a "Work Permit Manual" are Job Hazard Analysis
and Escalation Matrix. They can make a significant
contribution to the safety of job execution.
Job Hazard Analysis
Why a job is being started if its safety requirements
are not known? Who is responsible to ensure that
the precautions are known? Who is responsible to
identify them? Who is responsible to disseminate
them? Who is responsible to ensure that they are
actually implemented before the work is started?
Who is responsible to advise the safety requirementsduring the job execution? These are logical
questions for any field execution. "Good Leaders ask
Great questions". Asking these questions in peace
time, with no incident at hand and using the answers
to design appropriate management processes is
helpful. The leadership needs to ensure that
frameworks are created to fulfil the safety
requirements before the job is started.
Experience of various near-misses incidents
would show that the first step of proper
identification of the safety precautions itself could
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Petroleum Federation of India 43
be either missing or assumed or were
unstructured in many cases. A proper back-office
engagement to review (with field visit) prior to the
actual execution could be the gap. This is to be done
by the supervisory personnel who will be actually
piloting the execution. Unless there is a framework
in place to facilitate such a review, how can it be
expected that this will happen? The responsibility
to ensure that such framework is in place, that
there is such opportunity of planning and such
planning is compulsorily done for every field job,
rests with the senior management. Creating this
framework is essential. These requirements must be
embedded in the job planning. I have come across
arguments like: that these could cause delay in the
job, these are mere documentation… etc. These are
misplaced. An abnormal event will actually upset
execution schedule apart from handling other
eventualities. Once a job is taken up, there should
be a reasonable assurance that all hazards are
already known and they are addressed. The
execution schedule must include safety
requirements and their planning. Otherwise planning
is incomplete. Re-visit the narrative of the past
incidents and we will find gaps in such processes.
The choice could be between "we control the events"
or "events control us".
The assessment process of the possible hazards
prior to actually executing the job is termed "Job
Hazard Analysis" or JHA. OSHA-3071 gives
guidance on JHA in a simplified manner. The
compulsory "gateway" for carrying out the JHA
should be incorporated in the Work Permit Manual
and should be part of the planning process. This
can be termed as "Planning for Receipt of the Work
Permit" and is by the executor. "OSHA-PSM" standard
mandates that "process conditions" associated with
the work location must be communicated to the
executor of the job. With this input and domain
knowledge, the JHA should be conducted. The
framework provided should address the jobs of
"maintenance" nature as well as "project" nature. This
needs to be separately configured because the
workflow in each case will be slightly different due
to the involvement of different entities of the
organisation.
Across the organisation, it is required that a uniform
methodology for JHA should be followed. This will
ensure certain minimum datum in the approach. That
would mean appropriate templates should be
designed and adopted. Simple templates of
classical JBS can be adopted and converted intothe JHA templates. Making in two steps improves
clarity. In the first step the "Job" should be broken
down in "Activities". In the second, the likely Hazards
associated with the "Activities" should be identified
with control (or mitigation) measure for each. And
based on this the measures should be taken before
the permit is received. These measures may include:
the features to be ensured at the worksite, key
features of work procedures, tool-Box talk content,
monitoring requirements, administrative controls and
other precautions. Knowledge, awareness are good
words but the challenge always is to "bring alive"
the workers at the site to the issues in hand regularly
through the tool Box talk. Configuring administrative
gateways at each stage also helps. The JHA should
help in identifying such inputs which should be
regularly given to the workers.
This part of the process for maintenance can be
represented as:
Fig:1 Part flow chart of Work Permit Receipt planning
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Petroleum Federation of India44
For performing the JHA, the personnel must be
experienced in the field engagement. The overall
Work requirement is divided into smaller "Jobs". And,
each "Job" is to be divided into "Activity". The extent
of detail of this breakdown is experience based and
the extent of hazards of each "job" element should
determine whether it is to be considered as one "job"
element or is required to be broken down into further
"Job" elements. This is a qualitative process and
surely the significant problems will get identified and
thus get their due attention. The templates which
can be used to achieve such breakdown analysis
are shown in Fig-2.
"spiced curry" which is ready for consumption. There
is never a perfect day and the learning curve is to
be continually travelled. A level of proficiency and
confidence of sustainability can be achieved in a
few months. It makes significant contribution to the
job safety management.
The more this process is strengthened, better the
safety at the work place. The experience of JHA
outcomes is also useful for improving the Work
Procedures of field execution. Over a period of time
which is no more than a year, there will be a
perceptible upward shift in the performance datum.
The personnel will learn how to do JHA in advance
and how to plan safe execution. This will be by the
same personnel who would have been sceptical of
its practicality at the time of its inception! To judgethe benefits, organisation should have what it takes
to perceive and recognise "prevention".
Escalation Matrix
The authorisation to "issue" the work permit in a
Petroleum Refinery is normally with the "Plant Shift
in-Charge" who is a frontline officer. There are
arrangements in some companies which require him
to take concurrence of the Shift Manager in case ofHot work permits.
Questions do remain whether we are differentiating
between the Hazards of a Water treatment plant and
the Hazards of e.g. a Hydrogen Plant, hazards of a
Boiler House & Hazards of LPG storage, hazards of
a Class A product tank and Hazards of a Class C or
a Water storage tank. Similarly are we distinguishing
between the hazards of various operational-
situations e,g. whether a normal operating plant, a
Plant under turnaround Or a Plant undercommissioning can be treated same? A Class- A
product tank, can authorisation for a spark causing
work be given by a Shift incharge? Should we not
distinguish between them? In all these cases, will
the shift in-charge be the issuer without any
additional pre-authorisation?
Administratively it is more appropriate to configure
additional pre-authorisation layers based on the
perceived scale of hazards. This layer of pre-
authorisation is required to "enforce" the adequatedue-diligence in planning based on the scale of the
hazards.
Fig-2: Templates for JHA
A question always crops up in organisational
workflow as to whether it is possible to do this for
every job? The answer to this question is the question
"Is it appropriate to start a job without knowing the
hazards and the mitigation measures?" And answer
to this question cannot be "Yes". Safety gaps are
not tolerable. The question only is how we
achieve this.
Methodologies can be adopted to make this simple,
e.g. even though no two jobs are the same, but there
are areas of similarly. It is this part which should be
used. As more and more JHA's are done, they
become a good information bank. This should be
stored in a properly indexed manner. This is the
"boiled vegetable" and should be made accessible
to all the personnel. And for each job these should
be the starting point and can be used for carryingout the customised JHA for that specific job.
Experienced personnel can easily achieve this
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Petroleum Federation of India 45
Similarly, is the management permitting more than
one concurrent job at a location? That too when they
are hot jobs. And when it is so, are the scaled up
hazards addressed? What is that systemic
arrangement which prevents lower echelons from
taking such decision without the knowledge of senior
management? Is there a written down arrangementand which makes the personnel aware as to what
they can do and what they cannot? How high we go
in such layers of concurrence is left to the
management. But existence of such layers is
essential. In Safety, the good old principle is "No
need to kill a fly with a hammer, fly swatter is enough.
Don't try to drive a nail with a fly swatter, it won't go
in. Must use hammer". Balance needs to be
maintained while at the same time distinguish
between a lamb and a lion.
An "Escalation Matrix" can be inserted in the "Work
Permit Manual" to address this requirement. While
preparing this, there are three variables which can
be considered. These are:
Plant Group in which a Plant should be
considered. The Plants can be grouped based
on consideration of High Pressure, Hydrogen,
Utilities, High inventory of flammable material
etc.
Operational situation whether normal operation,commissioning, decommissioning, turnaround,
non-turnaround shutdown, partial shutdown.
Type of Permit whether cold work, hot work,
confined space entry, excavation etc.
Based on these variables, the Escalation matrix can
be prepared. A truncated example of such
Escalation Matrix is shown below :
Fig-3 Sample Escalation Matrix
A switchover from an open to an Escalation matrix
based system needs to be done with across the
board awareness and training. The personnel need
to be trained and feedback based iterative
improvements are required to be made over a period
of time. A gradual stabilisation once achieved, bringsabout a number of benefits. See Box.
The objective of such Work Permit Escalation Matrix
can be summarised as:
1. To ensure adequate review of the Safety
requirements
before a
h i g h e r
h a z a r d
work-front is
engaged.
2. To control the number of activities in high hazard area
and during high risk operations to minimise risk.
In a big facility, such a matrix could appear complex
for regular reference. This can be overcome by a
clear reference block diagram and refresher training.
How complex or simple it should be, is a decision
by the management. But its presence enhances
control and improves safety management.
These two features of JHA and Escalation Matrix can
add significant systemic safety in the Work Permit
management. However, like every other
management system, the implementation is the key.
In small steps, with training programs,
refreshers, feedbacks and iterative
improvements, full buy-in can be
achieved.
These will contribute to better control
on the activity, improved awareness of
hazards among the personnel and
establish a systemic framework to
control the hazards in job execution.
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Petroleum Federation of India46
Improving Corrosion
Assessment and Monitoring
Jaideep BhattacharyaConsultant, Advanced Solutions
Honeywell Process Solutions
Ulhas DeshpandeBusiness Leader, Advanced SolutionsHoneywell Process Solutions
Process industries are under increasing
pressure for improving margins and
reducing costs in the current economic
scenario. A way to achieve this has been investingand deploying certain productivity enhancement
tools and practices across various business
functions. Though these tools and practices help
operating companies cut costs to some extent, they
fail to take into account few of the most critical and
complex problems that if understood and handled
well can help the plant to reduce operating and
capital expenditure to a great extent.
Corrosion is one of the challenging problems in the
industry often resulting in losses to the tune of billions
of dollars. Reports around the world have confirmed
that some oil companies had their pipeline ruptured
due to corrosion and that oil spillages have resulted
in large scale ecological damage. The control of
corrosion in the oil field can be a complex problem
requiring detailed analysis and a thorough
understanding of the range of conditions expected
during the life of the system prior to the development
of a corrosion management plan.
Corrosion is one of the most significant issues
affecting asset integrity management in the oil and
gas, refining and petrochemical industries today.
Over the last few decades, these industries have
recognized the magnitude of corrosion and the
challenges that exist in the ability to detect and
mitigate its consequences.
To be specific, aged and water-absorbent insulation
is most often the culprit behind corrosion because
it is installed on carbon steel (CS) surfaces, which
are not effectively protected. While small diameter
piping has historically been the most vulnerable tocorrosion, heat exchangers, pressure vessels and
storage tanks also have been affected. This has led
to a substantial acceptance of new direct
assessment and pipeline integrity focused work by
the industry.
Current Challenges
The primary assumption of most oil and gas
operators is that corrosion does not exist in their
pipelines. This is a difficult contention to corroborate
without a detailed assessment and evaluation. On
the contrary, internal corrosion is very likely to exist
in measurable quantities where there is a presence
of liquid water and acid gases.
Furthermore, the actual areas that are affected by
corrosion in dry gas pipelines are small compared
to the lengths of pipeline transporting gas, makingit difficult to locate and mitigate corrosion. Using the
correct corrosion solving techniques, it provides the
operator with tools to inspect resources where
needed and helps make integrity assessments on
the entire pipeline.
Detecting Corrosion
The detection of existing corrosion is normally
attempted through various inspection techniques,
some of which focus on detecting and measuring
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Petroleum Federation of India 47
wall loss while others merely focus on detecting wet
insulation. Industry standards and guidelines such
as NACE SP0198, EFC 55, and API RP 580 have
attempted to provide more comprehensive systems
approaches and risk-based strategies to address
corrosion. These are largely reactive and qualitativemeasures leading to broad categorization of assets
for susceptibility ranking, which may not be very
useful in quantifying and mitigating corrosion before
the damage occurs.
Oil field corrosion challenges are very common. Fluid
characteristics change overtime resulting in systems
becoming less responsive to established corrosion.
Within the sphere of corrosion control and prevention
in the oil and gas industry, there are technical options
such as cathodic and anodic protection, material
selection, chemical dosing and application of
internal and external coatings. It is widely recognized
within the oil and gas industry that effective
management of corrosion will continue towards the
maintenance of asset integrity and achieve
optimization of mitigation, monitoring and inspection
costs.
Ideal Solution
Corrosion assessment has been widely
implemented across the oil and gas industry by
many plant operators. As per feedback from some
plants, the process has been found to be highly
effective for evaluating integrity of the plant process
with respect to the corrosion threat. The overall effort
required to implement any kind of internal or externalcorrosion is not significantly more or less than any
other integrity assessment processes. A corrosion
assessment solution should provide a robust
framework for performing cost-effective integrity
assessments. Advanced technology based flow and
corrosion models vastly enhance this process to
avoid the possibility of unnecessary digging or
random inspection at the site of corrosion.
The ideal solution should incorporate four broad
technologies: Multiphase flow modelling, corrosion
prediction, current corrosion assessment
methodology and real-time corrosion monitoring.
These types of technologies are capable of not only
determining propensity for water retention but also
the corrosivity of the environment in the presence of
the aqueous medium for the identified critical
segment.
This type of system integrates a number of key
functionalities including water-phase behavior
determination, pH computation, corrosion modeling,
flow modelling and comprehensive pipelineanalyses based on lab and field data.
Real-time corrosion measurement technology can
collect corrosion rate data every minute and save
the data on the device where it will be available for
retrieval during operator rounds. If available, this
corrosion data could be routed through existing
wireless or radio communications as well. Locating
the corrosion monitors at key points along an oil and
gas plant can provide continuous reliable information
to the operator.
Conclusion
Corrosion is a phenomenon that requires
interdisciplinary concepts that incorporate
metallurgy and materials science. For an industry
like oil and gas, which spends billions of dollars for
treatment costs every year, it is worth noting that the
damage caused by corrosion is not only at the plant
level but also other areas like building construction,
transportation, production, manufacturing and so on.
Thus corrosion is an industry wide problem, which
should be addressed proactively by respective
vertical markets.
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Petroleum Federation of India48
Pre Reformer Catalyst for
Hydrogen Plant
Chetan Bhola Asst. Manager - BU Refinery Catalysts
Süd-Chemie India Private Limited
Sanjeev MehtaGeneral Manager - BU Syngas CatalystsSüd-Chemie India Private Limited
Hydrogen is produced in large quantities
both as a principal product and as a by-
product. Globally, an estimated 76.6-78
million metric tons of hydrogen is expected to be
consumed in 2018. The largest volumes of on
purpose or merchant hydrogen are consumed at
refineries, ammonia and methanol production.
(Source: IHS)'
Hydrogen for Hydro processing to meet:
Transportation fuel specification and stringent
environmental regulations
Increased use of sour and heavier crudes which
generate less by-product hydrogen during crude
processing
Hydrogen Production by SMR Route
Most hydrogen produced in the Refineries is via
steam-methane reforming (SMR) where in
hydrocarbon reforms with steam under pressure in
the presence of a catalyst to produce hydrogen and
carbon oxides. Subsequently, it involves water gas
shift reaction and in final process step, pressure
swing adsorption, to remove all impurities leaving
essentially pure hydrogen.
Benefits of Pre Reforming
Pre-reforming is the term that has been applied to
the low temperature steam-reforming of
hydrocarbons in a simple fixed bed adiabatic
reactor filled with Highly Active Catalyst. The
Pre-Reformer utilises the heat content of the
feed stream to drive the steam-reforming
reaction and resulting in a equilibrium gas mixture
containing hydrogen, carbon oxides, methane and
steam.
Counting on Life of Pre Reformer
Catalyst
Life of a Pre Reformer Catalyst majorly depends on
designed Liquid Hourly Space Velocity (LHSV) &
Sulphur poisoning (Other poisons include alkali
metals, arsenic, & silica).
Using Deep Desulphurization Catalyst ActiSorb S6 which removes sulphur to ppb level can enhance
life of Pre Reformer Catalyst by up to 20%.
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Petroleum Federation of India 49
Can be Steamed for Carbon & Sulphur removal
and can be in-situ re-reduced for activation.
High activity and stability at high liquid hourly
space velocity (LHSV).
High thermal stability at elevated temperature
Lower differential pressure drop due to optimize
catalyst size and its robust structure.
Here below, we summarise two performance case
studies of ReforMax 100 pre-reforming catalyst:
Case Study 1 : Outstanding
Performance at very High Space
Velocity
At one of the Hydrogen Plant in Indian Refineries
with design feedstock as Straight Run C5-140
Naphtha & FCC Gasoline has two Pre Reformer
reactors (one online + one standby) operating at
very high LHSV of 5.5 hr-1. ReforMax 100 RS was
placed in service in June, 2014 and is currently in
operation about 12 months and expected to achieve
life of 24 months against the guaranteed life of
12 months. Present steep temperature profile
indicates rapid conversion to equilibrium presented
as below with progression caused by gradual
poisoning and can be extrapolated for accurate
prediction of residual life.
Guaranteed Life, months 12
Achieved Life, months >11
Expected Life, months >24
Due to the growing demand for Hydrogen,
application of pre-reformer has gained universal
acceptance in SMR Plants due to following key
drivers:
Feed stock flexibility since various feeds like
Naphtha/ LPG/Natural Gas/Refinery off gasescan be used.
Due to absence of higher hydrocarbons C2+,
it allows higher inlet temperature (~650°C) at
Reformer Inlet leading to reduction in radiant
heat requirement by 5-15% at Reformer Section.
Provides fuel savings against reduced export
steam, hence overall improved net thermal
efficiency of hydrogen production.
Reduces downtime due to quick start up sincecatalyst is supplied in Pre Reduced Form.
No special start up (like reduction of Reformer
Catalyst) & ease of overall plant operation and
eliminating problems (Potash Leaching)
associated with direct reforming process.
Enhanced lifetime of Steam Reformer and Shift
Catalysts as sulphur and other poisons are
arrested by pre reforming catalyst.
Süd-Chemie offers ReforMax® 100
ReforMax® 100 pre-
reforming catalysts are highly
respected amongst users and
installed in several operating
hydrogen, ammonia and
methanol plants worldwide. It
has demonstrated continual
robust operation at low steam to carbon ratios andwith various feed stocks over many years and has
proven its supremacy and potential to withstand
plant upsets and trips. ReforMax 100 series are
delivered in Pre Reduced & Stabilised form which
ensures a quick and smooth start-up.
Key advantages of ReforMax® 100
Exposure of operation with feeds like as
Naphtha (Coker Naphtha, SRN, HydrocrackerNaphtha, FCC Gasoline)/ LPG, Natural Gas and
Refinery off gases.
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Petroleum Federation of India50
Case Study 2 : Thermal Stability at
High Temperature
During Start Up activities, Naphtha passed over to
Pre Reformer Catalyst in absence of steam and bed
temperatures went to ~700°C and remained above
recommended limit (520°C) for more than 8 hours.
Post incident, catalyst was steamed for 4 hours and
re-reduced by maintaining S/H ratio as 8-10 mol/
mol to remove coke deposition on the catalyst.
As per the temperature profiles, before and after the
incident, there was no visible activity loss and
currently operating with excellent performance.
New Shape Development
ReforMax 100 is now available
in "5 Hole Rings" shape which
combines outstanding activity
of existing catalyst with lower
pressure drop.
Catalyst Size, mm Shape Relative, Dp
4.7 X 4.7 Tablets 1.00
11 X 5 X 2 5 Hole Rings 0.38
Conclusion with User's Interface
At present, ReforMax 100 is ho ld ing 59% of
installed market share in pre-reformer across
Hydrogen Units in Indian Refineries and outshines
with its performance at various operating conditions
like S/C ratio, Feed stocks, LHSV & poisoning
rates.
Most people have never learned that one of the main aims in life is to enjoy it.
“
“
~Samuel Butler
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Petroleum Federation of India 51
Debasis BhattacharyyaDy. General Manager (RT-I)
IndianOil (R&D Centre)
Satheesh V.K.Sr. Research ManagerIndianOil (R&D Centre)
B.V. Hariprasad GuptaResearch Manager
IndianOil (R&D Centre)
G. SaiduluResearch Manager
IndianOil (R&D Centre)
Optimisation of Visbreaker Unit
Owing to deterioration of average quality ofcrude and declining demand of fuel oil,
there is an increasing pressure for
improving the Visbreaker unit operation for
minimizing the fuel oil production. The major
component of fuel oil in a refinery is either Visbroken
tar (VB tar) or heavier fractions from Delayed coker
and FCC. In order to meet the specifications, various
cutter stocks like Decant oil, Heavy gas oil, Light
gas oil, Kerosene, etc. are added. The mostfrequently faced problems associated with fuel oils
are its 'stability' and its 'incompatibility' with the cutter-
stocks The stability of the fuel oil is mainly dependent
on the composition of VB tar with respect to
asphaltene, resin, aromatics, paraffin, etc., which in
turn depends on the properties of resid feed as well
as Visbreaker unit severity
Visbreaking is a mild thermal cracking of heavy
petroleum residues. The basic objective of this
process is to reduce the viscosity of the residue so
that amount of valuable cutter stock requirement and
also the fuel oil production is minimized. The main
operating variables in Visbreaking are temperature
and residence time. Earlier, the combination of high
temperature and low residence time was adopted
in coil Visbreaking. In the concept of soaker
Visbreaking, similar conversion is obtained at
relatively lower temperature but at higher residence
time resulting in energy savings. An increase in yields
of distillates and gaseous hydrocarbons productsand viscosity cutting ratio could be achieved through
increase in operating severity. However, beyond
certain severity / unit conversion, VB tar becomes
unstable and also there will be excessive coke
formation both in coil and soaker drum reducing the
cycle length.
The present paper focuses on the importance of the
VB tar stability and the compatibility of fuel oil
components for optimization of Visbreaker unitconversion and evaluation of the same through pilot
plant study.
Stability of Heavy Oils
The heavy oil can be considered as colloidal solution
of oil (such as saturates, aromatics), resins and
asphaltenes. The stability of the heavy oil is governed
by the concentration of these components. Among
these components, asphaltene and resin play the
most important role in stability of the system. The
stability of a dispersion system in colloid science
refers to the resistance of the particles to
aggregation. The degree of this resistance is a
measure of stability. The behavior of asphaltene in
oil depends on the attractive and repulsive forces
between adjacent particles. The interactions involved
include van der Waals forces, steric effects and
possibly electric double layer forces arising from the
charge at the interfaces.
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Petroleum Federation of India52
one drop of the sample is placed on
Chromatographic paper at 100 C for 1 hr. Based on
the rings formed, the fuel oil is rated as No.1, 2, 3, 4
and 5. If the spot is homogeneous (no inner ring) or
poorly defined inner ring, then the sample is
considered as compatible. If there is any definedring or dark solid area at the center, the sample is
incompatible. Potential Sediment Test (IP 390) is
another test usually carried out to check the storage
stability of fuel oil. The total sediment is determined
by ageing a sample of residual fuel for 24 hr at
100 C under prescribed conditions.
Experimental
Experiments were conducted in a Visbreaker pilot
plant having soaker configuration using short residue
as the feedstock. The characterization of feedstock
is given in Table-1. In the pilot plant, feed is gradually
heated in an electrical furnace to the desired coil
outlet temperature (COT). Turbulizing water is added
to the coil in a location corresponding to the entry of
radiation zone in commercial furnace. The water flow
rate was kept 1 wt% of feed rate in all the runs.
Heated feed is then fed to the bottom of the
Visbreaker reactor (equivalent to a soaker drum in
commercial plant) through a transfer line whose skin
temperature is maintained the same as that of
desired COT to minimize the heat loss. There is one
backpressure control valve (BPCV) at the outlet of
soaker, which is operated to control the soaker outlet
pressure (SOP). The reactor products are separated
in batch separators into lighter and heavier fractions.The lighter liquid fraction is separated from the non-
condensable product employing a water-cooled
heat exchanger and a cold catch pot. The gas flow
is measured using wet test meter after removal of
H2S through caustic and water scrubbers.
Asphaltenes having complex structures involving
carbon, hydrogen, nitrogen, oxygen and sulfur are
essentially condensed aromatic nuclei associated
with alicyclic groups. These fractions are often
surrounded by resins and heavy aromatics, which
are considered to improve dispersion stability. In anyprocess, if the concentration of asphaltenes
increases while that of resin decreases, beyond
certain point of asphaltene-resin concentration,
asphaltene gets precipitated out of the system
making the resultant mixture as unstable. The
'stability' of VB tar or fuel oil is normally expressed in
terms of 'peptization value' (P-value) and
'compatibility' of fuel oil is determined by 'spot test'.
P-Value
P-value is the method to determine the state of
peptization of asphaltenes in heavy oil. Asphaltenes
are defined as n-heptane insoluble and aromatic
soluble. So, peptization of asphaltene can be
affected by the addition of paraffin to the heavy oil.
In this method, n-cetane is considered as the paraffin
oil to be added to the heavy oil. The p-value of a
heavy oil sample is determined using the relation,
p = 1 + X, where X is the maximum dilution of the
sample with n-cetane at which the asphaltenes are
just not flocculated, which is expressed as the
number of milliliters of n-cetane used for the dilution
of one gram of the sample. If one gram of sample
takes less than 0.3 ml of n-cetane, i.e. p-value
< 1.3, the sample is considered to be 'unstable'.
Spot Test (ASTM D 4740)
Spot test actually indicates the compatibility among
the different streams added into the fuel oil and
normally carried out using the finished fuel oil
product and not the VB tar alone. In this method,
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Petroleum Federation of India 53
Table-1: Characterization of vacuum residue feedstock
Density @ 15oC, gm/cc 1.0316
CCR, wt% 20.78
S, wt% 5.38
Viscosity, cSt @135oC 202
Aromatics, wt% 56
Saturates, wt% 44
Asphaltenes, wt% 6.57
The main products from the pilot plant are gas
(C5-), light oil (C5-180 0C) and Heavy oil (180 0C+),
which are characterized using chromatography. The
material balance of all the runs were calculated and
only the experiments having material balance of
(100 + 3)% have been considered. The stability of
VB tar was measured in terms of peptization value.
Tests were conducted with varying quantity of
different cutter stocks for getting fuel oil of required
viscosity and flash point. After addition of these
cutter stocks, the compatibility of fuel oil was also
measured using spot test.
Results & Discussions
For experimental study, it is important to simulate
the pilot plant with the operation of the targeted
commercial unit. Accordingly, the base case data
as well as the product samples from the commercial
Visbreaking unit was collected. The liquid products
were analyzed for boiling point distribution and the
yield pattern was calculated considering the product
overlap. Experiments were conducted at different
temperatures (around the COT normally maintained
in the commercial unit) and 10 kg/cm2(g) SOP.
The yields of individual products were plotted against
3800C- conversion and the yield pattern was found
out as base conversion. Here, 3800C- conversion is
defined as sum of the yields of the products boiling
up to 3800C. The product yield data along with theimportant process variables of commercial and pilot
plant are compared in Table-2. It is seen that pilot
plant results are closely simulating the commercial
operation.
Table-2: Base case simulation of the pilot plant
Base Case Pilot Plant
3800C- Conversion, wt% 17.6 17.6
COT, 0C 444 445
SIT, 0C - 407
SOP, Kg/cm2 10 10
Product yields, wt%
Gas (C5 -) 1.1 1.6
VB Naphtha (C5 -180 0C) 5.2 5.5
VB Gas oil (180 -3800
C) 11.2 10.5
VB Tar (3800 C+) 82.4 82.4
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Petroleum Federation of India54
In pilot plant, after the feed furnace, the transfer line
as well as soaker drum is equipped with electrical
heaters since adiabatic operation is difficult. Since
major amount of reactions take place in the soaker
drum, soaker internal temperature (SIT) could be
considered as realistic yardstick of the reactionseverity. The 3800C- conversion is plotted against
SIT in Figure-1, from which it is seen that the
conversion increases with increase in SIT. In
commercial Visbreaker unit, COT is considered as
the main severity parameter. In order to find out the
COT from the pilot study, a correlation between COT
and SIT was established which is shown inFigure-2.
Figure-3 shows change in VB tar viscosity with
increasing conversion. It is seen that the viscosity of
VB tar decreases with increase in conversion. The
Analysis of VB tar corresponding to di fferent
conversions are summarized in Table-3. Since the
base case simulation of the commercial unit is at
SIT of 407oC, two sets of experiments were
conducted at this temperature to check the
repeatability of the result. It is evident from Table-3
that within the conversion range tested, the saturates
(paraffins & naphthenes) concentration in the VB tar
is reducing with increase in conversion while that of
the aromatics is increasing. Thermal cracking
reactions enable dissociation of various carbon and
hydrogen bonds to form free radical intermediates.
These free radicals then enter into other reactions
and thus result into wide spectrum of products. For
a given molecular weight, the ease of cracking of
different type of hydrocarbons, follows the order:
parrafins > olefins> naphthenes > aromatics.
Among the same type of hydrocarbons, the greater
Figure-1: Conversion vs Soaker internal
TemperatureFigure-2: COT vs SIT
the molecular weight, the higher is the crackability.
Therefore, as cracking proceeds, the concentration
of paraffins and naphthenes will reduce while that
of the aromatics will likely to build up. This is the
primary reason for reduction in viscosity of the VB
tar with increase in conversion. But this phenomenon
does not extend all along the conversion curve.
Figure-3: Viscosity of VB tar @ 1000C vs conversion
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Petroleum Federation of India 55
Table-3: Properties of VB tar at different unit conversions
Expt. No. 1 2 3 4
SIT, C 407 407 415 424
Conversion, wt% 14.42 13.55 24.67 32.5
Sulfur, wt% 5.17 5.12 5.36 5.43
Aromatics, wt% 58.3 56.4 62.1 63.7
Saturates, wt% 41.7 43.6 37.9 36.3
CCR, wt% 23.8 23.3 25.3 26.5
In Figure-4, the asphaltene content of the VB tar
product is plotted against the conversion. Unlike theviscosity, the asphaltene in VB tar is increasing with
increase in conversion. When heavy oil is thermally
processed, side chains of asphaltenes, resin and
heavy aromatics will get chopped off and long chain
paraffins will be cracked into lighter one or olefins.
This will lead to polarization of the molecules and
polarized resins will immediately polymerize to form
more asphaltenes. Beyond certain conversion or
reaction severity, the decrease in viscosity due to
decrease of paraffin content will be lower than theincrease in viscosity resulted from formation of
asphaltene. So the reduction of viscosity of VB tar is
not a linear function of conversion in Visbreaking
process and viscosity reversal will occur beyond a
particular conversion. Further, if the severity is higher
than this, the asphaltenes will get precipitate as liquid
crystalline phase (or carbonaceous mesophases)
and quickly polymerized to form coke.
Figure-4: Asphaltene vs Conversion
As mentioned earlier, P-value is the measure of the
state of peptization of asphaltenes in heavy oil. With
increasing operation severity, the concentration of
asphaltenes increases while that of resin decreases
resulting in the precipitation of asphaltenes. This
precipitation phenomenon is not a reversible one.So even if some aromatic rich stream is added to
the unstable VB tar, stability cannot be regained
back. Therefore, in a commercial Visbreaker, it is
very much important to monitor the P-value of VB
tar while optimization of the unit conversion. The unit
conversion should never exceed the threshold
conversion at which the VB tar P-value is less than
1.3. Owing to such significance, the P-value of theVB tar samples was measured which is reported in
the Table-4.
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Petroleum Federation of India56
Table-4: Stability tests of VB tar at different unit conversions
Expt. No. 1 2 3 4
P-value >1.5 >1.5 1.2 1.0
Spot test No.1 No.1 No.4 No.4
It is seen that at 13.5 to 14.5 wt% conversion, the
P-value of the VB tar is more than 1.5 indicating that
the corresponding VB tar sample is stable. While
the VB tar samples corresponding to 24.67 and
32.5 % conversions are found to be unstable. In such
case, it is important to find out the optimum
conversion and always operate the unit below this.
Another important point is to note that in a stable
system, asphaltene gets peptized in the oily phase
comprising paraffins and light aromatics. As soon
as this peptized condition is disturbed, asphaltene
gets precipitated in the oily phase and causes the
'instability' of the system. Therefore, the absolute
P-value is also a guiding parameter for selecting the
cutter stock components.
The properties and the quantity of the cutter stocks
added to the VB tar have significant role on finished
fuel oil properties. In the commercial unit, Decant
oil, Heavy gas oil and Kerosene are normally used
as the cutter stocks for meeting the fuel oil
specifications. The same cutter stocks were added
to the VB tar samples generated in the pilot plant
following the philosophy as adopted in the
commercial unit to meet the specifications ofviscosity and flash point (40 cSt @ 100 C and 66 C
respectively). The compatibility of the components
in fuel oil blend prepared as above was checked
through spot test. The result of the spot test is shown
in Table-4. It is seen that spot test of the fuel oil blend
corresponding to stable VB tar as confirmed through
P-value measurement pass while the others fail.
Therefore, if VB tar sample is itself unstable, the
corresponding fuel oil blend is going to unstable
since it is quite difficult to bring back the precipitated
asphaltene into the solution even by addition of
aromatic rich stream. However, if VB tar sample is
stable, excess of paraffinic cutter stock beyond the
threshold value can make the final fuel oil unstable.
Conclusions
Under the scenario of declining refining profit margin,
optimal operation of existing Visbreaking unit is of
paramount importance. However, there is a tradeoff
between the Visbreaker unit conversion and stability
of VB tar product. There is an optimum operation
severity for a given hardware dimension of soaker
drum beyond which the VB tar becomes unstable
followed by viscosity reversal phenomena.
P-value of VB tar is the governing parameter for
adjusting the operation severity of a given Visbreaker
unit. Once, the stable VB tar is produced while
keeping the conversion at the optimum level, the
quality and quantity of the cutter stocks to be added
to meet the final specifications of the fuel oil are also
important. The selection of the cutter stocks
becomes more critical while operating theVisbreaker unit close to the optimum level. Spot test
is the guiding tool for assessing the compatibility
between the base VB tar and the cutter stock
components. While adopting the philosophy as
outlined above, prior pilot plant study backed by
proper simulation of the commercial plant operation
comes handy in deciding the optimal conversion
minimizing the risk of producing unstable fuel oil.
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Petroleum Federation of India 57
Mukesh K. ShivhareEngineer
Engineers India Ltd. (R&D Centre)
Shailendra KumarDeputy Manager
Engineers India Ltd.(R&D Centre)
Compressor Anti Surge System Trouble Shooting
R. V. SreevidyaDeputy Manager
Engineers India Ltd.(R&D Centre)
P. Narendra KumarDeputy Manager
Engineers India Ltd.(R&D Centre)
S. R. SinghDeputy General Manager
Engineers India Limited(R&D Centre)
Centrifugal compressors are relatively
trouble free, dependable gas movers.
Almost any gas can be compressed by
these machines, and their extensive size and
pressure ranges made modern process plants and
efficient production of bulk chemicals possible in
many instances. Centrifugal compressors are vital
units and are often considered as heart of many
industrial processes. Often, these equipments are
critical to the operation of the plant, yet they are
seldom installed with a spare unit. Surging
represents a major threat to compressors and its
prevention is an important process control problem
in these environments as surging can result in costly
downtime and mechanical damage to compressors.
Compressor design is generally based on a set ofoperating points predicted from steady state heat
and material balance. However, compressor system
usually experiences very rapid transient operations
when it is in service such as start up, shutdown, load
fluctuation, equipment failure etc. This inherent
dynamic nature may not be sufficiently addressed
by a steady state simulation model and hence
dynamic simulation is increasingly applied for
addressing compressor systems such as surge
protection, stability during load fluctuations, etc.
Dynamic simulation is an engineering tool
to evaluate process design and is very useful in
design of compressor surge protection, evaluation
of operation envelop, field support and
troubleshooting.
Dynamic simulation involves solving of set of
differential and algebraic equations and
implementing this model on a computer to describethe time- dependent behavior of a process. The
developed model can then be used for
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Petroleum Federation of India58
Evaluation of operability of a proposed system
and necessary modification before actual
implementation
Testing of wide range of alternative control
schemes
Testing of startup procedure
Sizing and stroke time of recycle valve or othercontrol valves can be checked for all operating
conditions
Determination of initial controller gain and reset
settings. Scaling of transmitters and computing
instruments can be also checked.
Overall arrangement of exchangers, check
valves, vents etc. can be evaluated to maximize
controllability.
System performance during emergency trip or
effects of equipment failure or operator error can
be evaluated.
The aim of the work presented in this paper is to
show the application of dynamic simulation in
designing control system and verifying operability
of a plant. A case study for the adequacy checking
of the existing anti-surge valve of multistage
horizontal centrifugal propane refrigeration
compressor is discussed. In this study, dynamic
simulation is used to investigate the performanceof compressor during various process upsets to
analyze the behavior of compressor anti-surge
system and provide recommendations on the
feasibility of existing protection system.
Surge Phenomenon andCompressor Control
Every centrifugal or axial compressor has (at a given
rotational speed and inlet conditions) a characteristic
combination of maximum head and minimum flow
beyond which it will surge. Preventing this damaging
phenomenon is one of the most important tasks of
a compressor control system. The most common
way to prevent surge is to recycle or blow off a portionof the flow to keep the compressor away from its
surge limit. Unfortunately, such recycling extracts an
economic penalty due to the cost of compressing
this extra flow. So the control system must be able
to determine accurately how close the compressor
is to surging so it can maintain an adequate-but not
excessive-recycle flow rate. This task is complicated
by the fact that the surge limit, in general, is not fixed
with respect to a single variable such as pressure
ratio or the pressure drop across a flowmeter.
Instead, it is a complex function that also depends
on gas composition, suction temperature and
pressure, rotational speed, and guide vane angle.
An understanding of the principles of integrated
control and protection systems is thus extremely
important to operate turbo compressors.
Preventing Surge
Figure 1: compressor surge line on compressorperformance map
(a) (b)Figure 2: (a) compressor surge control system layout(b) compressor operating window for safe operation
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Petroleum Federation of India 59
The obvious way to prevent surge is to decrease
network resistance whenever the operating point
moves too close to the surge limit line. This is
accomplished by opening an anti-surge valve to
recycle or discharge a portion of the total flow. The
chief drawback to this approach is the efficiencypenalty that it entails-the energy that was used to
compress the recycled gas goes to waste. Thus,
the control system should be tailored to open the
anti-surge valve only when-and only as far as
is-necessary. On the other hand, if we do not provide
adequate protection against surge, we risk
prohibitive repair and downtime costs. Therefore,
accurate and dependable methods of determining
the surge limit are required. Anti-surge control entailsmeasuring the distance between this surge limit and
the operating point and then maintaining an
adequate margin of safety without sacrificing
efficiency or stability. The solution is to maintain the
operating point on or to the right of a line known as
the surge control line (SCL; see Figure- 2b). The
distance between the surge control and surge limit
lines (the margin of safety) should be just enoughto allow the chosen control algorithms to counteract
an impending surge. Whenever the operating point
moves into the surge control zone (i.e., to the left of
the SCL), the anti-surge valve must be opened fast
enough to keep the operating point from reaching
the surge limit line and far enough to return it to the
surge control line. On the other hand, when the
operating point moves to the right of the SCL, the
anti-surge valve should be closed as far as possiblewithout moving the operating point into the surge
control zone.
Figure 3: Schematic diagram of Propane Refrigeration Process in LNG industry
turbine driven compressor is more than 29MW at a
speed of about 3000 rpm.
The propane from the compressor discharge is
cooled, and then condensed against sea water. An
inventory of liquid propane is held in an accumulator.The liquid propane flows from accumulator to the
shell and tube heat exchangers at three propane
Case study
Propane Refrigeration System
This system, schematically shown Figure 3 provides
secondary refrigeration to the LNG process.
Propane refrigerant is used to cool the natural gas
feed and condense the primary multi component
refrigerant. Refrigeration is provided at three
pressures (temperature levels). The compressor isa single casing 3 stage machine with two side
streams. Design power consumption of the steam
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Petroleum Federation of India60
pressure levels. The propane evaporated in these
exchangers then flows back to the compressor.
Compressor surge protection is provided by recycle
of warm gas from the desuperheater exit to the
suction drum of each section.
This compressor system combines a compressor
in which the dynamic response of one section is
directly affected by the responses of other sections
with a process which has large volumes and a large
liquid inventory. A LNG train tripped multiple times
due to over speed of propane refrigeration
compressor during summer. Anti-surge valves that
are provided in all recycle lines were initially
suspected to be inadequate and undersized. There
is a concern that process upsets or equipment
failures might impose conditions in which surge
could not be prevented. This dynamic simulation
study was proposed to analyze compressor anti-
surge control system and the adequacy of the surge
control valve to protect the compressor.
Dynamic Simulation Model andObjectives
Simulation Model
A schematic of the dynamic simulation model set
up using a commercial dynamic simulator to
Figure 4: Dynamic model of Propane Refrigeration
describe the various elements of the compression
recycle loops is presented in Figure 4. The entire
system was broken down into the compressor,
valves, and a number of volumes for associated flash
separators, knockout drums, desuperheater,
accumulator and the gas-cooler. The parameters of
every element were determined from the data
provided by the equipment manufacturers and the
gas plant engineers. In the few cases where certain
data were not available, values were assumed based
on field experience and common-sense engineering
practice.
Model Objectives
The objective of the model is to verify the
adequacy of existing anti-surge valves and
remove any bottlenecks so that increase of the flow
of propane and decrease of the discharge
pressure of propane compressor can be
maintained and prevent the compressor to go in to
surge conditions. Several test scenarios have been
performed using the dynamic model, two of these
are being discussed in detail in the following
section:
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The reduction of propane vapor flow decreased the
surge margin and surge controller moved the
compressor away from surge region by taking
appropriate action and increasing the flow across
the compressor. The existing Anti-surge valve CV's
are found sufficient to keep the compressor out of
surge during the scenario.
Figure 5:
(a) Response of percentage above surge of
1st, 2nd and 3rd stage
(b) Response of Anti-surge valves of 1st, 2nd and
3rd stage
Loss of cooling in propane cooler
and propane condenser
Heat duties of propane cooler and condenser at
compressor discharge are reduced to 40% due to
decrease of cooling water flow rate within
30 minutes.
Figure 6: (a) Loss of duty in desuperheater
(b) Response of percentage above surge of
1st, 2nd and 3rd stage
Test scenarios and results
Train Trip or propane supply to the separator is
reduced:
The compressor propane flow rate is reduced to 60
% of normal operating condition due to the trainproduction reduction and hence the propane flow
to all the exchangers(low, medium and high level)
are dropped within 30 minutes.
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Petroleum Federation of India62
(c) Response of Anti-surge valves of 1st, 2nd and
3rd stage
The reduction of cooling duty in propane
desuperheater by 60 % of the normal value created
two phase flow of propane in the circuit from the
downstream of condenser followed by the increasein the discharge temperature of Compressor. Since
the overall vapor load in the circuit is increasing
because of loss of cooling in the propane
desuperheater, the compressor would be at the risk
of high discharge temperature trip. The anti-surge
valves are able to keep the compressor out of surge
at the start of disturbance, however after the
completion of disturbance, and due to the combined
effects of pressures and temperatures in the circuits,the machine would be at the risk of high discharge
temperature trip.
Conclusion
Stable and safe compressor operation is an
essential component in providing product streams
of a plant. The importance of surge and its prevention
is discussed. The application of dynamic simulation
in verifying the operability of propane refrigerant
compressor in safe zone without surging under
various possible upsets is studied. Though existing
anti-surge valves are found to be adequate for the
scenarios that are analyzed, the third stage anti-
surge valve in case of train trip reaches up to 80 %
opening and it is recommended to replace third
stage anti-surge valve to allow some safety margin.
The study also confirmed the possibility of
compressor trips due to failure of cooling water in
cooler and condenser.
Maybe all one can do is hope to end up with the right regrets.
“
“
~Arthur Miller
You will never be happy if you continue to search for what happiness consists of.
You will never live if you are looking for the meaning of life.“ “
~Albert Camus
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From a chemist's point of view crude oil, which
is feeding all petrochemical value chains,
occurs in a highly reduced state. On these
grounds alone it is not surprising that oxidation
reactions are at the heart of countless processes in
the chemical industries. Besides the chemical
reactions for the synthetic production of
intermediates and final products, other oxidation
processes are equally essential, for example, to heat
feed streams, condition catalysts or treat waste
streams.
For the vast majority of these oxidation reactions,
molecular oxygen is the oxidizing agent of choice.
The oxygen in most cases is supplied in the highly
diluted form of process air. Almost 79 percent of air
(by volume) is inert and so its oxidation potential is
quite limited. This extra "ballast" - mainly nitrogen -also bears the implication that it has to be routed
through the different process steps, which is
associated with considerable effort such as
compressing, heating and cooling procedures.
Corresponding constraints induced by the presence
of nitrogen in the air, like e.g. capacity limits due to
compressing constraints and pressure drop, short
residence time in reaction stages and high input of
energy can often be overcome resp. mitigated byenriching process air with pure oxygen. This can be
realised either by topping up a given air flow by O2
addition or by reducing air flow and compensating
the thereby reduced oxygen by O2 addition.
Referring to the latter case - i.e. when the amount of
oxygen supplied to the oxidation step is kept at a
constant level - the diagram given in Fig 1 shows
the decrease of total air flow relative to the degree
of oxygen enrichment level:
Oxygen Enrichment for Air Oxidations in Chemical Industries:Overcoming Limitations
Yogesh DesaiManager-Application Sales(Chemical & Environmental)
Linde India Limited
Diganta SarmaHead of Applications & Market Development,
South Asia & ASEANLinde Gas Asia Pte. Ltd.
Bernhard Schreiner, PhDSenior Expert Chemical Process
Linde AG
Fig 1: Decreased flow of process air combined withO2 addition is often the key to higher feed
throughput
When looking at realised applications of
O2 enrichment the decrease of process gas flow by
a reduction of air flow - i.e. reduced nitrogen flow as
well - combined with O2 addition is often the key for
understanding the observed effects. Among them
are capacity increase, changes in selectivity as well
as energy savings in heating and cooling steps toname a few. Depending on the specific case of
oxidation process and degree of O2 enrichment the
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Fig 2: Technically applied air oxidations where
O2 enrichment has been realised
However, despite its wide range of applicability there
are cases of air oxidations which are not suitable for
O2 enrichment. Prominent here are a number of gas
phase oxidations realised over solid catalyst material
arranged as fixed beds which typically are not very
efficient in heat removal and therefore prone to hot
spots which have to be avoided. Such detrimental
effects are not to be expected to that extent at othertypes of catalytic oxidations as in fluidized beds or
in gas/liquid oxidation reactors. Here normally the
dissipation of the additional reaction heat caused
by the addition of pure oxygen is not an
insurmountable obstacle, especially in moderate
O2 concentration in the enriched process air. This
means that the latter process types lend themselves
to O2 enrichment, in particular when operating within
the low level range.
Increase of Capacity is Often the Focus
At the technical scale O2 enrichment is often applied
especially to increase the capacity of process units
based on air-only application in the oxidation step;
at such units this kind of process intensification can
be realised by combining reduction or retention of
air (resp. nitrogen) flow with O2 addition, thereby
increasing oxygen availability which in turn can allowfor increased throughput of feed. Applications of low-
level enrichment typically come with a capacity
increase of up to approx. 30 percent, as seen, for
example, at Claus units in oil refineries.
O2 enrichment is seldom considered for
process plants where air blowers/
compressors are limited in delivering
sufficient process air. This shortcoming
usually is most pronounced during hot
weather periods when air density is lowerthan usual. In such cases corresponding
economic considerations may come
down to the comparison of costs for a
bigger air blower versus implementation
and operation of O2 enrichment. However,
in many cases the increase of air flow to
increase the capacity is not a feasible
option; e.g. at the fluidised bed processes increase
in airflow could lead to enhanced catalyst loss,
excessive abrasion of catalyst material and too
pronounced erosion of metal.
consequences differ and call for individual
evaluation.
Low Enrichment Levels Prevail at
Realised Revamps
As indicated by Fig 1 the achievable flow reduction
is considerable already at a low O2 enrichment level.
This lends itself for revamp measures which typically
can be realised on the basis of only minor process
modifications. Subsequent change of process
parameters, in particular temperature increase within
the oxidation section and less diluted process
streams down-stream, often can be dealt with in
existing (air-only-based) plant installations or
adapted by minor process changes; like e.g.
increase of cooling capacity at a catalytic oxidation
step or change out of refractory within a furnace
chamber. On these grounds of typically low adoption
effort it is not surprising that most applications of
O2 enrichment are based on low enrichment levels,
characterised by an oxygen concentration in the
enriched process air of up to approx. 30 vol. % as
shown in Fig 1. This also holds for most of the cases
shown in Fig 2 which offers a variety of air oxidation
examples where O2 enrichment is applied at a
technical scale; thus can be considered to be state-
of-the-art.
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introduced into the furnace chamber via dedicated
lances. This is the case of part of the Claus units
applying O2 enrichment. The second option in
general more frequently used in chemical
applications is the admixing of oxygen into the air.
This is typically realised by injection of oxygen intothe process air pipe; i.e. up-stream the oxidation
reactor. In most of the cases O2 enrichment is a
revamp technology; therefore the respective
O2 injector typically has to be designed according
to the geometry and process conditions of the
existing main process air pipe. Fig 3 shows an
example of such an O2 injector of the well-proven
OXYMIXTM Injector type which directs the O2 jets
against the air flow.
Fig 3: OXYMIXTM Injector - Jets of gaseous oxygen
exit the holes of the ring nozzle against the air flow
By this constellation the main purpose of an O2
injector can be fulfilled reliably: This is to ensure
Built O2 injector
Positioning in air pipe - 3-D CFD view
Safety Measures: Of High Importance
Of course it has to be appreciated that O2 enrichment
not only comes with handling of technical oxygen,
but also changing conditions within the process
plant, especially temperatures and partial pressures.
Therefore, comprehensive safety considerations and
measures are mandatory. Safety aspects with
respect to the O2 supply chain depend to a
considerable degree on the O2 source applied.
Looking further downstream, the process related
safety considerations and measures largely depend
on the type and characteristics of the air oxidation
of interest. One important example is the different
appreciation of the O2 concentration in the process
gas down-stream the oxidation reactor. For thermal
partial oxidations like e.g. sulphur production by
oxidation of H2S this topic is simply irrelevant as the
oxygen coming with the air is totally consumed in
the oxidation section (also for O2 enriched
operation). In sharp contrast, this aspect can be of
utmost importance, e.g. when looking at gas/liquid
oxidations in an organic liquid phase which typically
do not totally consume all the oxygen coming with
the process air. Here the oxidation reactor off-gases
also contain combustible components and typically
the O2 content has to be kept below a certain
threshold (MOC = maximum oxygen concentration)
to avoid inflammable conditions; e.g. if needed by
installation of inerting equipment.
However, from a general perspective such safety
considerations are also of importance when looking
at oxidations on air-only basis, i.e. without additionaluse of oxygen, and normally do not represent
insurmountable problems.
Where to Inject Oxygen:
Two Alternatives Prevail
Two ways to introduce pure oxygen into an air
oxidation process are by far most abundant: one
option is to inject oxygen into the reaction zone of
the oxidation step- among the typical examples are
thermal air oxidation reactors where oxygen is
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Petroleum Federation of India66
typically offering smooth access as well as flexible
gas availability, is normally only an option within
some big industrial cluster areas. Therefore, in many
cases a decision on the type of appropriate
O2 supply is restricted to choosing between LOX
supply - i.e. delivery of liquid oxygen by tank vehicles- and erection of an on-site plant for O
2 production.
Main criterion therefore normally is not the purity of
the oxygen which typically varies depending on the
respective O2 source. The impurities in question,
namely the inert argon and nitrogen, already occur
in air which is applied in the oxidation process
anyway; on these grounds it is obvious that the
mentioned impurities of technically produced
oxygen are not of any concern as long as theO
2 content is above a certain threshold; i.e. typically
an O2 concentration of > 90 vol.% suffices. Such
quality can be expected from all O2 sources usually
offered by industrial gas companies for
O2 enrichment; therefore sufficient O
2 purity can be
realised no matter if the oxygen originates from
cryogenic generators (i.e. including LOX) or from
pressure swing adsorption units.
Fig 4: Frequently applied scheme of O2 enrichment
addition also information with respect to utility costs
and local infrastructure are important. In case high
and very high O2 volumes are needed on a
permanent basis a dedicated on-site O2 generator
is normally adequate, as is the case at many fluid
catalytic cracking (FCC) units. On the other hand
homogeneous admixing of oxygen within a short
distance of the process air pipe to exclude any
extreme oxidation conditions like local temperature
excursions within the down-stream oxidation reactor.
In order to prepare an air-based plant for O2 enriched
operation normally the only hardware modification
needed is the implementation of the tailor designed
O2 injector. Therefore an access has to be provided
for O2 injection at the pipe of the main process air.
For installation of a corresponding stud a few hours
of plant stop are needed or in case the plant cannot
be stopped, a hot tapping procedure can be
performed. As soon as the O2 injector is inserted
into the stud (see Fig 6) the plant is prepared for
operation with O2 enrichment at any appropriate
time.
Sourcing and Quality of Oxygen
Most applications of O2 enrichment are based on
the scheme shown by Fig 4. At the left it gives an
overview of the different sources which have to be
considered for O2 supply. A nearby pipeline network,
O2 provision: Specific Demand and
Economics Deserve Individual
Examination
Crucial for a decision on the appropriate O2 source
are aspects like the amount of oxygen needed and
the volume profile of O2 demand over the time. In
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The hardware arranged within a protecting cabinet
looks simple and straightforward, but it is worth a
closer look to understand how operational and safety
risks are mitigated. Therefore a few important topics
will be discussed here:
Of course the main item within the flow control
cabinet is the flow control valve. But in addition the
safety features are of high importance. Any major
deviation of the actual O2 flow must be alarmed and
- if the situation cannot be corrected - oxygen flow
has to be interrupted in a suitable way. In case the
gaseous oxygen for O2 enrichment is sourced from
a liquid O2 tank temperature control in the piping
must be provided to avoid that any too cold oxygen
enters the air duct. And during shutdown periods
an absolute separation between O2 source and
processing plant has to be ensured which includes
safeguarding against creeping gas flows.
With respect to O2 injection located down-stream of
the O2 control device Fig 6 shows a picture of an
inserted OXYMIXTM Injector, in this case designed
for a max. O2 throughput of 700 m3 /h, installed in
the process air pipe of a technical plant.
Fig 5: O2 flow control cabinet of the type OXYMIXTM
Flowtrain, well-proven also in field trials
on-site plants for O2 generation do not always
operate economically if the O2demand is fluctuating
too widely; this typically is given when O2 enrichment
is applied for peak shaving in cases where the feed
flow to the oxidation plant does significantly and
frequently vary. This is one explanation why O2
enrichment installations at Claus units for sulphur
recovery, which in many oil refineries are often
challenged by such changing operating conditions,
are often supplied by an O2 source based on LOX
delivery. Here O2 provision is highly flexible,
especially in view of O2 load fluctuations and
increasingly interesting at lower O2 demands.
Anyway, in order to select the most advantageous
O2 source for a given case a considerable variety ofaspects have to be pondered; i.e. besides O
2
demand aspects also taking into account e.g.
regional LOX availability and reliability of supply.
Hardware for Controlled Meteringand Injection of Oxygen
In order to realise O2 enrichment according to the
scheme shown by Fig 4, O2 supply hardware has to
be installed that is appropriate to the environment
and challenges at the site. This of course also holds
for the measuring and control unit for O2 metering
to the O2 injection point. Beyond functionality here
again safety considerations are in the focus of
interest. One example of a measurement and control
unit is shown by Fig 5.
Fig 6: Once implemented into the air pipe - here inpreparation of trials - the O
2 injector allows for
start-up of O2 enriched operation at any time.
Field Operational Trials - An OptionWorth Considering
Operators of air oxidation plants appreciate the
straightforward possibility to perform trials with
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O2 enrichment at their own production plant before
considering final implementation. Such trials
normally can be realised with relatively limited effort
in the industrial-scale. For preparation and execution
of trials it is recommended to involve a partner who
can not only contribute by field experience withO
2 use and process know-how. It is also for keeping
the trial costs at bay when such a partner beyond
the latter competences can bring in appropriate
hardware for supply/control/metering/injection of
oxygen which can be rented for the trial duration;
typically industrial gas companies experienced in
O2 applications lend themselves for such kind of a
co-operation. Of course the trial costs correlate to
the corresponding O2 demand, this in turn dependson trial duration which can range from approx. one
week up to even a few months. Typically the trials
are based on delivery and vaporization of liquid
oxygen (LOX) which is a flexible source of gaseous
oxygen; e.g. with respect to the pressure level of
the O2 stream generated which can be adjusted up
to 10 bar and even beyond.
Performing the trial comparison of air-only operation
with oxygen enrichment is a well-proven method to
find out on an experimental basis how an individual
processing unit, i.e., including the installations down-
stream of the oxidation step, reacts to additional
oxygen use. Typically, beyond capacity increase,
other effects and opportunities can be not only
identified but also quantified. Such concrete
information later on can prove to be very helpful in
taking the decision on a permanent installation of
Fig 7: Air oxidation of liquid toluene - Air-only vs. O2 enriched modes
O2 enrichment and its embodiment, e.g. kind and
size of the respective O2 source. Often it turns out
that the effort on off-gas treatment is reduced when
O2 enrichment is applied up-stream for the oxidation
step which typically translates into savings in
operational expenditure, e.g. if the fuel demand foroff-gas incineration is reduced. Moreover, the
performance of field trials allows for confirmation of
expected as well as identification of unexpected
limitations of O2 application; e.g. the max. possible
O2 enrichment level can be among the trial results.
In the rather exceptional case the limitations found
might exclude permanent implementation of
O2 enrichment, at least as long as the processing
plant is not adapted to additional use of oxygen.
O2 Enrichment in the Gas/Liquid
Phase
Industrial production of commodities and
intermediates like, for e.g., terephthalic acid,
acetaldehyde, phenol/acetone, cyclohexanone and
benzoic acid are based on catalytic air oxidations in
the gas/liquid phase. When considering process
intensification by O2 enrichment, laboratoryexperiments can give valuable information on the
effects of additional O2 application, especially in view
of selectivity respectively product yield. One result
based on semi-batch experiments - i.e. (enriched)
air is passed through a stirred vessel filled with
7 litres of toluene - is given by Fig 7 which shows
the dependence of toluene conversion to benzoic
acid on the O2 contents in the oxidation air (160 °C,
9 bar a).
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which often are beneficial. They depend case by
case on the type of air oxidation and can encompass
energy savings, increased plant availability,
decreasing the load on waste stream treatment and
reduced emissions. All these aspects have to be
taken into account when weighing the benefits ofO
2 enrichment, especially against the additional
operating expenditure for oxygen.
In short: additional use of oxygen for O2 enrichment
can offer technical, financial and even environmental
benefits across a wide range of applications - from
oil refinery operations to downstream chemical
processing.
In order to get a clearer picture on applicability,hardware demands, appropriate implementation
and overall justification of O2 enrichment operators
are encouraged to consider co-operating with an
adequate partner, typically gas companies
experienced in O2 applications. Such a partner can
substantially contribute to developing an application
case by running simulations, erection and
implementation of O2 supply installations and - as a
mentionable option - performing field trials incooperation with the operating company.
The results shown in Fig 7 indicate that basically
O2 enrichment does lend itself to increasing toluene
throughput in a corresponding technical installation
for production of benzoic acid.
Summary & Conclusion
O2 enrichment as an interesting option for process
intensification of air oxidations is described. Such
application of technically generated oxygen can
answer plant limitations and constraints in
production flexibility at a diversity of air oxidation
types. Accordingly O2 enrichment, typically
characterised by a low-investment effort, has already
proven its value in many thermal as well as catalytic
air oxidation processes.
A variety of starting points for considering of O2
enrichment are identified.
The main driver for the implementation of this kind
of O2 application in the majority of cases is its
potential of mitigating processing bottlenecks,
typically leading to increased plant capacity.
Besides, such additional use of oxygen at airoxidation plants usually comes with other effects
Successful people are always looking for opportunities to help others.
Unsuccessful people are always asking, ‘What’s in it for me?’“ “
~Brian Tracy
Life isn't a matter of milestones, but of moments.
“
“
~Rose Kennedy
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Acomprehensive analysis was necessary to
identify the best scenario required to meet
ULSG regulations: Severe FCC feed pre-
treatment alone or milder pre-treatment combined
with FCC gasoline post-treatment. CFHT cycle
length requirements, with and without post-
treatment, were also under scrutiny to determine their
impact.
An existing refinery reconfigured to process Heavy
Canadian Crudes while maintaining its FCC Unit was
assumed. The VGO feedstock consists of a 55,000
BPD blend of straight run VGO and Heavy Coker
Gas-Oil with 4.2 wt% sulfur. Due to the refractory
nature of this feed, it has to be hydrotreated in a
high pressure unit prior to feeding the FCCU and
the resulting gasoline constitutes about one third of
the total gasoline pool and all of the pool sulfur.
The following three cases were considered:
Case 1: A high HDS CFHT unit and FCCcapable to produce a 10-wppm Gasoline pool
sulfur without the need of a FCC Post-treatment
unit with a CFHT cycle length of 4 years to match
the FCC.
Case 2: A moderate HDS CFHT designed for a
4-year cycle length with a FCC Post-treatment
unit (Prime-G+) designed for a 4-year cycle
length to meet ULSG pool specifications.
Case 3: Similar to Case 2 but with a 2-year cyclelength target for the CFHT unit combined with a
Prime-G+ unit designed for a 4-year cycle
length. During the CFHT catalyst change-out,
the Prime-G+ unit will operate at a higher
severity to meet pool sulfur requirements.
For all cases, a relatively high pressure was
selected for the CFHT to ensure good hydrogen
addition during the whole run. Reactor residence
time was adjusted to meet the CFHT HDS and cycle
length requirement - Figure 1. The very severelevel of HDS and 4-year cycle length in Case 1
naturally leads to a much larger CFHT than the other
cases. High purity hydrogen is supplied from a
SMR plant.
10 ppm Sulfur Gasoline Opportunity Analysis
Larry WisdomMarketing Executive
Axens
Jay RossSenior Technology and Mktg. Manager
Axens
Delphine LargeteauSenior Technologist - Mktg.
Associate Axens
Figure 1 CFHT HDS & Cycle Length
A block flow diagram illustrating the three different
cases with the various configurations along with the
corresponding products considered for the
economics is shown in Figure 2.
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Figure 2 Case Studies Block Flow Diagram
The economic evaluation was based on a
Discounted Cash Flow (DCF) analysis assuming a
depreciation period and a project duration of 10
years. In addition, a profitability index comparison
in terms of Net Present Values (NPV) and Internal
Rate of Return (IRR) was conducted. The prices for
investment, catalysts, utilities, feedstock and finishedproducts were based on 2011 averaged values
assuming the plant to be located in the USA serving
a domestic market. Prices are presented in Table 1.
Table 1 Price Considerations
Feedstock 96 US $/bbl
Natural Gas 4.0 US $/MMBtu
Hydrogen 3.300 US $/MSCF
LPG 69 US $/bbl
Propylene 140 US $/bbl
Butenes 112 US $/bbl
Gasoline Premium 127 US $/bbl
Diesel/LCO 131 US $/bbl
Fuel Oil 104 US $/bbl
For all three cases considered, projections on CFHT
and FCC operations were conducted leading to
expected product yields and hydrogen requirement.
As one could have expected, the implementation of
a high severity CHFT (Case 1) leads to better product
yields in the FCC but has a major drawback of driving
hydrogen consumption up. Results in terms of main
product yields and hydrogen cost for each case arepresented in Table 2. The evaluation was based
on a Natural Gas price of $4/MMBTU resulting in a
hydrogen cost of $3.300/MSCF.
Table 2 Study Results - Product Yields & Hydrogen
Requirement
Case Case 1 Case 2 Case 3New Units CFHT CFHT+ CFHT+
Cycle Length 4 yr Post-treat Post-treat
4 yr + 4 yr 2yr+4yr
Gasoline Yield,
Vol.% / VGO Feed 61.9 56.3 55.0
Diesel + LCO Yield,
Vol.% / VGO Feed 27.2 27.6 28.0
Propylene Yield,Vol.% / VGO Feed 7.8 7.5 7.3
Butenes Yield,
Vol.% / VGO Feed 8.8 8.3 8.1
Hydrogen Cost,
$/bbl Feed 4.71 3.73 3.66
The hydrogen cost for Case 1 is almost 25% higher
than that of Case 2 or Case 3; however, the yield
improvement is quite significant over the lower
severity CFHT cases. Between the lower severity
CFHT cases, the yields and hydrogen consumption
are rather similar with the more severe and longer
cycle Case 2 providing a slight improvement in terms
of yields over Case 3 commensurate with the small
increase in hydrogen consumption.
With regards to the operating cost (OPEX) of the
different cases, the study took into consideration the
hydrogen, octane and utility costs. Compared to the
other factors, the hydrogen cost was by far the major
contributor to the OPEX. In addition to the operating
cost, a detailed Total Capital Investment (TCI) was
developed to estimate the CAPEX for each case.
The TCI trend illustrated in Figure 3 clearly shows
that Case 1 has a much higher capital requirement
than the other two cases due to the significantly
higher desulfurization and cycle length requirementsfor the CFHT.
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Figure 3 Total Capital Investment (TCI) Impact
Both Net Present Value (NPV) and Internal Rate of
Return (IRR) comparisons are shown in Figures 4
and 5. The high severity CFHT without post-
treatment, Case 1, was considered as the basis and
the IRR and NPV of the other cases were compared
to Case 1.
Figure 4 NPV Results
Figure 5 IRR Results
The NPV results favor Case 1 with a high HDS/long
cycle length CFHT and no post-treatment over more
moderate HDS CFHT cases coupled with a post-
treatment unit. On the other hand, the IRR is most
favorable for Case 3 with the lowest cost CFHT
option (moderate and 2-year cycle) coupled with a
4-year cycle post-treatment Prime-G+ unit.
A sensitivity case was examined to determine the
impact of Natural Gas (NG) cost on the NPV results.
The findings are highlighted in Table 3 where pricing
is contrasted to the 2011 basis above. Assuming a
higher NG price (6 vs. 4 $/MMBTU), the cost of
hydrogen increases and the difference in NPV
between the three cases diminishes somewhat.
Table 3 Study Results - Hydrogen Cost
Sensitivity Study
Case Study Case 1 Case 2 Case 3
NPV @10% : Base Base x 0.93 Base x 0.93
Nat. Gas =
4 $/MMBTU
(case 2011)
NPV @10% : Base Base x 0.94 Base x 0.94
Nat. Gas = 6
$/MMBTU
From and IRR perspective, the advantage of Case
3 increases when hydrogen cost increases and the
gap in NPV between Case 1 and 3 decreases.
Surprisingly, Case 2 with a 4-year CFHT cycle in sync
with the FCC cycle does not show an NPV or IRR
advantage over the shorter cycle Case 3 for either
NG pricing scenario. One could have assumed that
designing a CFHT in sync with the downstream units
compared to limiting the CFHT cycle length to only
2 years would be an advantage. However, the
4-year cycle post-treatment unit brings the additional
flexibility to continuously operate during a CFHT
catalyst change-out. Despite higher feed sulfur (that
could be partially limited with a change in crude diet
during the CFHT catalyst change-out) the design of
the post-treatment unit with the Prime-G+
technology is robust enough to handle this higher
severity requirement during the catalyst change-out.
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This flexibility is clearly illustrated in Figure 6 which
shows operating data on a Prime-G+ unit in a
refinery processing heavy crudes and equipped with
a FCC CFHT pre-treater. When the CFHT is in
operation the normal feed sulfur to the Prime-G+
unit is typically below 200 wppm. Despiteturnarounds or operation upsets on the CFHT unit,
which can lead to feed sulfur as high as 900 wppm,
the product sulfur from the Prime-G+ unit can be
maintained to the target value of 20 wppm at
all times.
When processing Full Range Cut Naphtha (FRCN),
the sulfur content in the product is maintained at
the target value (20 ppm), as shown in Figure 6,despite variations in FCRN quality thanks to the FCC
pretreatment option.
Figure 6: Prime-G+ Operation Flexibility
The flexibility brought by adding a post-treatment to
the compulsory FCC pretreater when processing
heavy crudes should be underlined and is a major
advantage over the pre-treatment alone solution. In
order to produce a gasoline pool with less than 10-
wppm, the refinery becomes a chemical plant with
no margin for error; relying on the CFHT alone leaves
little flexibility.
In summary, coupling a CFHT with a FCC Naphtha
post-treatment unit brings the following advantages:
The CFHT severity is lowered which offers thepossibility to revamp an existing CFHT.
It is possible to design the CFHT unit for a cyclelength of 2 years instead of 4 years.
The Prime-G+ post-treatment design issimplified to typically a single-stage unit.
The refinery reliability and flexibility is improved:
CFHT upset may be compensated by the Prime-G+ post-treatment unit.
CFHT severity may be decreased if needed/ permitted.
FCCU operation is more flexible in terms offractionation quality.
FCC gasoline end-point may be increased whenmargins favor gasoline production while stillcontrolling FCC naphtha sulfur through post-treatment.
The issue of SOx and NOx control in FCC flue gas is
not addressed in the above analysis. The high
severity CFHT (Case 1) may allow the typical 50 and
40 ppmv targets for SOx and NOx to be achieved
directly while a flue gas scrubber would be necessary
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10 wppm limit in transportation fuels sulfur levels.
After reviewing commercial best practices and
specific refinery challenges, meeting new ULSG
regulations with existing FCC post-treatment assets
can be achieved. Low refinery margins combined
with capital constraints will likely favor the revampingof existing FCC post-treatment units.
Although each situation is unique, the combination
of pre-treat and post-treat solutions around the FCC
Unit will often result in increased flexibility and
benefits. As a licensor of CFHT, FCC and FCC post-
treatment technologies, Axens is tailored to provide
the service that will fit each specific case.
to meet such constraints with Cases 2 and 3. The
addition of the scrubber for Cases 2 and 3 decreases
the IRR differential to Case 1 by one point while
conversely the NPV advantage over Case 1 is
increased by approximately 1%.
It is important to note that in spite of a trend in favor
of Case 3, the conclusion drawn from this particular
study is case specific and cannot be generalized to
other cases that may have different configurations
and project premise.
Conclusion
A large number of countries are working towards a
If you love life, don't waste time, for time is what life is made up of.“ “
~Bruce Lee
Everyone suffers some injustice in life, and what better motivation than to help
others not suffer in the same way.“ “
~Bella Thorne
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Increasing trend of sulphur content in crude oil
and natural gas and tightening sulphur content
in transport fuels often forces refiners and gas
processors to opt for additional sulphur recovery
capacity. On the other hand, environmental
regulatory agencies of many countries continue to
promulgate more stringent standards for sulphur
emissions from oil, gas and chemical processing
facilities. Therefore, It is important to develop and
implement reliable and cost effective technologies
to cope with the changing requirements.
In the past several technologies emerged at different
times to comply with the most stringent regulations.
Earlier, a Claus based sulphur recovery unit (SRU)
was designed and operated at an efficiency of 98%.
In the present scenario, most of the countries require
sulphur recovery efficiency in the range of 99.9% or
more. This calls for removal of additional sulphur
constituents in the Claus tail gas. It can be possible
by setting up of additional tail gas treatment unit in
the downstream of RU.
In Indian refineries, most of the old SRUs were
designed with technologies, like MCRC, CBA, etc.
They offer an overall Sulphur recovery of ~99%. As
the sulphur recovery efficiency up to 99% is not
sufficient to meet environmental regulations,
upcoming grass-root SRUs are being designed
taking 99.9%( min) sulphur recovery into
Make in India: Successful Indigenous TGTU
Vartika ShuklaGeneral Manager (R&D)Engineers India Limited
D. K. SarkarDy. General Manager (R&D)
Engineers India Limited
Kausik Ghosh MazumderDeputy Manager (R&D)Engineers India Limited
consideration. The sulphur recovery of existing SRUs
has also been increased from 99% to 99.9% by
integrating them with new Tail Gas Treating Unit
(TGTU).
EIL'S TGT Technology
EIL's TGT technology represents the best
controllability, energy optimization and is achieving
99.9+% overall sulphur recovery with emissions of
< 10 ppmv H2S.
In this process, the residual tail gas from Claus
section, containing mainly N2, H
2O and residual
sulphur species in form of H2S, SO
2, Sx, COS & CS
2,
is preheated to ~240oC using electric or steam
reheater, before sending to hydrogenation reactor.
The hydrogenation reactor employs Co-Mo catalyst
that converts the residual sulphur species to H2S.
H2 is used as a reducing stream. The following
reactions are taking place in hydrogenation reactor
a) Conversion of SO2 and elemental sulphur (Sx) is
by hydrogenation:
SO2 + 3 H
2 H
2S + 4 H
2O + H
Sx + x H2 x H
2S + H
b) Conversion of COS and CS2 is by hydrolysis:
COS + H2O
H2S + CO2 + H
CS2 + 2 H
2O 2 H
2S + CO
2 + H
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The bed temperature of hydrogenation reactor is
increased to ~270-280oC due to exothermic
reaction. The hot gas coming from hydrogen reactor
mainly contains H2O, N
2 and H
2S. The hot gas is
cooled in TGTU-WHB by producing LP steam. It is
then further cooled to 40oC in quench column. Inquench column, the hot process gas is contacted
counter currently with quench water resulting in
condensation of large quantity of water vapor. A
continuous bleed of water is done from quench
column. The quench water leaving the bottom of
quench column is cooled in Pump around cooler
before routing to top of quench column. A slip stream
of quench water is filtered in filter to remove any
accumulated particles in the circulating water.
The gas leaving the quench column is routed to
amine absorber where it is counter currently
contacted with MDEA solution. Lean amine enters
from the top of amine absorber. Lean Amine has
40%wt MDEA and remaining water. H2S and CO
2 in
the process gas are absorbed by lean amine.
Relative to H2S absorption,CO
2 absorption is slow
as MDEA is more selective towards H2S. Sweetened
gas leaves from the top of the absorber to incinerator
and rich amine is routed to regenerator from bottom
of absorber.
The following reactions are taking place in the
absorber:
MDEA + H2S MDEA + + HS-
Rich amine is preheated in lean rich exchanger
before entering the regenerator. The regenerator
consists of regenerator column, reboiler, overhead
condenser & reflux drum. Acid gas mainly H2S is
stripped off and is cooled in overhead condenser.
Water condensed is collected in reflux drum. The
gas leaving the reflux drum comprises H2S, CO2 &water vapor. Condensed water is returned to the top
of the regenerator column. Hot lean amine leaves
from the bottom of the regenerator column is cooled
in the same lean rich exchanger followed by amine
cooler before sending it to amine absorber. Filtration
of amine is done to remove heat stable salts (HSS)
& corrosive products formed during operation. The
typical flow diagram is figure I
Figure I : Typical flow diagram of EIL's TGT Process
Sulphur Recovery in SRU
Required recovery efficiency from SRU+TGTU
Available pressure of Claus Tail Gas
Key Parameters
The key parameters effecting the selection of the
TGT process configuration are:
Existing equipment and process configurationof SRU
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Availability of utilities like steam& power
Space availability
Project execution time for revamp case
Costs (capital and operating)
Commercialization of Technology: A “Makein India” Initiative
Case I : Grass-root design of SRU with TGTU
The first commercialization of EIL's TGT technology
was done successfully in May, 2013 at one Indian
refinery. EIL successfully designed & commissioned
SRU with TGTU. The capacity of the unit is 10TPD.
The tail gas coming from SRU is preheated in electric
heater to a temperature of 280oC.The bed
temperature in hydrogenation reactor is maintainedat ~300oC. The gas leaving the reactor is cooled in
TGTU-WHB to ~180oC where LP steam is
generated. The process gas from TGTU-WHB is
further treated in quench column by counter-currently
contacting with quench water at 40oC. The process
gas which leaves the top of the quench column is at
40oC and enters absorber from bottom where it is
treated with lean amine. The sweetened gas leaves
the absorber at 40oC to incinerator and rich amine
from bottom of the absorber to amine regeneration
section. The amine regeneration section is common
for processing various rich amine of different amine
treating units.
Case II : Revamping of existing SRU byintegrating TGTU and utilization of availableequipment
Sulphur recovery of existing SRUs can be enhanced
by integrating it with TGTU. The method of
revamping these units depends on the existing
configuration and availability of plot area. Revamp
of SRU uses maximum number of existing
equipment after adequacy check so that the capital
cost incurred during revamp is minimized. Revamp
has been carried out in three SRUs of sulphurrecovery efficiency 99% & capacity of 65TPD each.
Design of all the three SRUs was based on modified
Claus process. Each train had two Claus reactors
and two low temperature Claus reactors. The
configuration of SRU before revamp is given in
Figure II. SRU had main burner (MB), main
combustion chamber (MCC), four Claus reactors,
five condensers (C-I to V) & two reheaters
Figure II: Existing configuration of SRU
Since TGTU can accept tail gas from SRU which is
subjected to 96% sulphur recovery, two Claus
reactors have been considered in Claus section. Use
of two Claus reactors not only provides the required
level of sulphur recovery but also provides the backpressure sufficient to operate TGTU without any
hydraulic problem. SRU configuration has been
modified accordingly, which consists of main burner
(MB), main combustion chamber (MCC), two Claus
reactors, three condensers (C-I to III) & two
reheaters. The modified SRU configuration is shownin Figure III.
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Figure III: Modified SRU configuration
Execution for commercialization has been followeddifferent steps which included simulation of Claussection under revamp and tail gas treating section,adequacy check of existing equipment forre-utilization, dismantling of lines not in use after
revamp and conventional procedure for design,procurement, installation, erection,Precommissioning & commissioning.
It has been observed that TGTU can easily beintegrated in such SRU at minimum modification andtime.
Case III : Integration of TGTU in the downstream
of CBA/MCRC based SRU
Many of the Claus units that are in operation do nothave enough pressure to handle a new TGTU. Theupstream pressure of the Claus unit cannot be
increased at the higher pressure as this will lead to
operate the upstream amine section at higher
reboiler duty and in most cases required significant
changes in the amine unit. In such scenario, a
booster blower in the tail gas unit is installed to
overcome the pressure limitation. Retrofit Tail Gas
Units will typically require a booster blowerdownstream of the quench column to overcome the
additional pressure drop. The blower is located after
the quench column to minimize the actual volume
(by means of cooling and condensation of water),
and before the Absorber to take advantage of the
higher pressure. With proper design and operation,
booster blowers are inherently very reliable, requiring
minimal maintenance. In this case, the pre heater,
hydrogenation reactor, TGTU WHB, Quench column
will operate at slight vacuum.
The benefits of the process are:
TGTU can be started independently and no
dedicated start-up blower is required
Tail gas recycle ensures process stability at high
SRU turndown
1 X 130 TPD of TGTU at HPCL-Mumbai, TGTU, 2X
45 TPD , 2X82 TPD ( 4 Trains) of TGTU at BPCL-
Mumbai are under implementation
The flow scheme is given in figure IV.
Figure IV : Flow scheme of TGTU in the downstream of CBA/MCRC based SRU
equipments in CBA or MCRC based units to optimizethe costs and schedule by suitable retrofitting ofthese into the TGTU flow scheme.
Adding the TGTU licensing capability has further
expanded EIL's Environment friendly TechnologyPortfolio and enhanced EIL's contribution to the
success of "Make in India" initiatives.
Conclusion
EIL has supplied this indigenous technology to
several Indian Refineries for grass-root units as well
as tailoring the design for revamps.
EIL's expertise in process design and engineeringadds further value to clients to assess idle existing
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Overcoming Barriers to Entry into Petrochemical Markets
Matthew LippmannUOP LLC, a Honeywell Company
&
Soumendra BanerjeeUOP IPL, a Honeywell Company
Over the past decade, major shifts in global
energy markets have transformed the
competitive landscape for fuel and
petrochemical producers and caused many firms
to reconsider their technology investment strategies.
These changes in the global macro environment
have included events such as the shale gas
revolution in the United States, and trends such as
a widening gap between gasoline and naphtha
based petrochemical margins. While these events
have created new opportunities for existing refiners
to improve value generation by leveraging vertical
integration with downstream petrochemical
producers, there remain several barriers to entry that
continue to cause significant foregone value
creation. This paper will explore opportunities for U.S.
based fuel refineries to add petrochemical feedstock
production to their product slate and discuss how
refiners can overcome the technical and self inflicted
inhibitors that prevent many operators from
leveraging opportunities in petrochemical
integration.
Price Volatility and the
Petrochemical Hedge
Petrochemical demand growth has been matching
or exceeding global GDP growth for the past
decade. This dynamic has resulted in a widening
gap between the value of transportation fuels and
petrochemicals, making petrochemical technology
investment strategies increasingly attractive to
today's world class refiner. Another advantage of
adding petrochemicals to the product slate is thatthey can provide a hedge against feedstock price
volatility as the value uplift of petrochemicals is
remarkably stable despite significant fluctuations in
crude oil prices. Figure 1 highlights the IHS historical
and projected value uplift of aromatics and olefins
over naphtha feedstock in North America. While
there is some variation between products, the
average margin uplift has been well within the $300
to $500 per ton range, and expected to remain there
for the foreseeable future.
Figure 1: North America Margin Uplift of
Petrochemicals Over Naphtha
Even more significant is the fact that this discrepancy
in fuel and petrochemical growth rates has come ata time when the naphtha content of crude is
increasing due to the influx of shale based
production from the United States. This has resulted
in a significant regional overproduction of naphtha
around the world shown in Figure 2. In fact, the
amount of excess naphtha currently on the market
is on the same magnitude as the total amount of
the global benzene and para-xylene consumption
combined, providing a significant growth opportunityfor the petrochemical industry.
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Petroleum Federation of India80
Figure 2: Expected Regional Naphtha Oversupply
2013-2018, MMTA
A third trend specific to the United States is the shifts
in gasoline trade flows due to the impact of ShaleBased production. As lighter crudes displace heavier
feedstocks and domestic production continues to
rise, the U.S. naphtha surplus translates to reduced
gasoline imports from Canada and Europe and a
significant increase in U.S. exports to Latin America
as shown in Figure 3. However, these projections
are based upon the assumption that significant
refining expansion does not occur in Latin America
and traditional export markets will absorb theincremental gasoline production from the United
States. Should these future markets fail to
materialize; additional pressure will be placed on
U.S. based refiners to find alternative outlets for
naphtha including upgrading to petrochemicals.
Figure 3: US Gasoline Current and Forecast
Trade Flows (KBPD)
The Cultural Divide
While intermediate product streams, such as
naphtha or LPG have often provided a common
interface between refinery and petrochemical
businesses, investing in "on purpose" integration
between complexes is a relatively recent industry
trend. In most developed regions, refinery
configurations are similar to that shown in Figure 4
with conversion units such as Delayed Coking and
Fluid Catalytic Cracking, a reforming unit for gasoline
upgrading, and gasoline and distillate hydrotreating
units to meet fuel quality specifications.
Figure 4: Traditional Fuels Refinery Configuration
Conversely, in many emerging regions it is now
common practice to take an integrated approach
that offers the benefits of lower overall cost and
allows the refinery to capture production of higher-
valued petrochemical products by upgrading
internal refinery streams. Therefore new refineries
are often constructed in coordination with an
adjacent petrochemicals complex similar to Figure
5. These complexes will often include additional
propylene generation from the FCC, an aromatics
complex to recover benzene and xylene from the
reforming unit, and are typically integrated with a
steam cracker that can generate and recover
additional light olefins from refinery light naphtha and
LPG.
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Figure 5: Integrated Refinery-Petrochemical Complex exposure to new and unfamiliar markets and
technologies that don't align with existing
organizational structures. For example, while
traditional fuel refinery engineers discuss daily
strategy in terms of boiling ranges, octane barrels,
and product yields, petrochemical producers speakin terms of product selectivities, metric tons per year,
and cash cost of production. Figure 6 provides an
example of how refiners and petrochemical
producers may differ in the performance evaluation
of the same technology solution. The chart on the
left shows para-xylene yield versus units of activity
for a variety of Continuous Catalyst Regeneration
(CCR) reforming catalysts. The chart on the right
shows the same catalysts ranked as a function ofCash Cost of Production (CCOP).
Yet despite common understanding of integration
advantages, refiners in developed regions often
hesitate to invest capital in petrochemical productiontechnologies. One simple cause is reluctance to add
Figure 6: Different Views of CCR Reforming Catalyst Technology Evaluation
A further complication is that crude selection and
optimization in a refinery with petrochemical
integration will be different than for traditional fuels
production. For traditional fuel producers, simple
boiling range and gas chromatograph
characterization of the naphtha components is
sufficient. However, for the integrated complex,
characterization of petrochemical intermediates
such as aromatic ring potential through a reformer,
or olefin selectivity in a steam cracker is increasingly
important. Figure 7 shows the relative benzene and
para-xylene yields for various C6-C8 naphtha
compounds in a CCR reforming unit and Figure 8
shows the relative light olefin yields for various
C4-C6 isomers in a naphtha steam cracker.
In each case, developing tools that can predict
selectivity of individual molecules to desired
petrochemical products is the key to selecting the
optimal feed slate, conversion technology, and
distillation cut points in the complex to fully leverage
intermediate streams and maximize high value
products.
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The Outdated Investment Model
Due to the poorer intrinsic margins, a fuels refinery
will generally push to the maximum capacity required
to achieve acceptable margins. For an integrated
complex, the right extent of integration may be a
more important question than refinery throughput.
Because of the higher margin returns it is often
preferential to direct incremental capital to
petrochemical units to optimize returns. This is
highlighted in Figure 9 which shows the incremental
IRR improvement as a function of capital investment
for a fuels only refinery, a moderately integrated
refinery with an aromatics complex, and a fully
integrated refinery with an aromatics complex and
steam cracker. As shown, while the incremental
capital investment shows a peak return for the fuels
refinery as units reach optimal economies of scale
and break into multiple process trains, the
incremental capital investment applied to
petrochemical technologies continues to leverage
economies of scale while providing higher margin
uplift for products. Understanding these economic
breakpoints often means updating economic
models to fully leverage the higher margin per
incremental capital investment that petrochemical
technologies deliver in the integrated complex.
Figure 9: IRR vs. Capital Investment Analysis for Different Refinery Configurations
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A couple of specific examples are shared in more
detail below.
Case Study I: The Benzene Opportunity
As highlighted earlier, the market demand growthfor petrochemicals have led to unique opportunitiesin the U.S. One such example is benzene whereimports into North America have been increasing ata significant rate over the past decade and areexpected to remain elevating over the next several
years as shown in Figure 10.
Figure 10: North America Benzene
Import/Export Rates
scheme but with a Sulfolane™ benzene extraction
unit added in place of the saturation unit.
Figure 12: Benzene Extraction Flows Scheme
Source: IHS Annual Services, 2013
This trend is due in part due to reductions inreforming severity and gasoline production due toethanol blending requirements and lower productionvolumes of aromatic rich pygas from steam crackersas operators switch to lighter shale gas basedfeedstocks. However, in what seems a marketdisconnect, many companies invest in benzenesaturation technologies such as shown in Figure 11to meet EPA MSAT I, and MSAT II regulations of
0.62v% benzene in the refiner's gasoline pool.
Figure 11: Typical Benzene Saturation Flow Scheme
However, other alternatives exist to meet MSAT II
benzene regulations without consuming valuable
hydrogen or downgrading high value petrochemical
compounds to fuels. Figure 12 shows a similar flow
The summary economic evaluation for upgrading
the complex away from an existing benzene
saturation unit and adding a benzene extraction unit
is shown in Figure 13. While the operating expenses
for the BenSat unit present a significant drag onoverall refining economics due to the cost of
hydrogen consumption, on purpose benzene
recovery can provide significant return on investment
using historical benzene and gasoline price spreads
with payback timelines approaching one year.
Figure 13: Economic Evaluation of Benzene
Saturation vs. Sulfolane Extraction
Case Study II: The Mixed Xylene Opportunity
While the benzene extraction evaluation shows
significant return, on purpose benzene investments
can often suffer from economies of scale as benzene
makes up a lower portion of the reformate aromatic
pool, and regulatory concerns as benzene handling
and shipment logistics can often be problematic.
As shown in Figure 14, mixed xylenes make up a
much larger portion of the reformate product
distribution.
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Figure 14: Typical Reformate Product Distribution Figure 16: CCR Yield Loss for Standardand Next Generation UOP CCR
Technology
Therefore it is worth considering whether the
extraction investment would be better positioned at
capturing incremental mixed xylenes from therefinery as shown in Figure 15 by adding a simple
fractionation unit.
Figure 15: Fractionation for Mixed Xylene Recovery
One significant downside of this configuration is that
in order to crack the non aromatic components in
the xylene cut to the proper specification, the
reformate severity needs to be increasedsignificantly which can lead to significant C5+ yield
loss. UOP's technology innovation teams have been
recently focused on this issue and are in the process
of developing next generation reforming technology
that minimizes C5+ yield loss at higher reforming
severity. As shown in Figure 16, the new advanced
CCR technology from UOP can significantly improve
C5+ yield retention even at higher severity operation
providing an additional opportunity for refiners togenerate aromatics much more selectively than in
the past and further improve investment returns.
Another technology option that solves the xylene
purity issue without an increase in reformer severity
is to add solvent extraction. In addition there is an
option of adding a Tatoray™ unit to disproportionate
and transalkylate toluene with C9/C10+ aromatics
to produce additional benzene and xylenes as
shown in Figure 17.
Figure 17: Extraction and Toluene Transalylation for
Benzene and Xylene
Figure 18 shows the incremental petrochemical
production that can be expected for a nominal 25
MPBD CCR reforming unit by adding a fractionatorto recover xylenes, or a fractionator and Tatory unit
to generate additional benzene and xylene.
Recovery
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Petroleum Federation of India 85
Figure 18: Product Breakdown for Fractionation and Extraction/Transalkylation
A final consideration for any investment is also to
consider shipping costs and logistics. Depending
on location, transportation costs can play a large
role in the overall investment returns. Figure 19
evaluates the sensitivity of shipping costs on the
estimated 10 year NPV for both the xylene
fractionation recovery scheme and the full Tatoray
recycle scheme examples highlighted above.
Figure 19: Transportation Cost Sensitivities on NPV for Aromatic Recovery Options
risk models limit many opportunities but with
the introduction of new optimization tools that
have allowed companies to better understand
technology integration strategies, combined
with new technology developments that target
on purpose integration strategies, the opportunity
for fuels producers to enter the petrochemical
markets has never been better and should bea key part of any world class refinery growth
strategy.
Summary and Conclusions
At first glance, the addition of petrochemicals to the
product slate appears to be a straightforward
opportunity for today's world class refiner who
desires to leverage synergies between technologies
to ensure stable margin uplift in dynamic market
environments. However, in spite of the evident value
of integration, the number of fuel producers in the
United States that have modified their facilities toleverage petrochemical production is relatively low.
Simple barriers such as cultural biases and outdated
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Petroleum Federation of India86
DeNOx Technology For Refiners
For a Green Footprint
Raman SondhiVice President
Haldor Topsoe International A/S
Sachin PanwarBusiness Development ManagerHaldor Topsoe India Pvt. Ltd.
In recent years there has been increasing concern
worldwide and also in India for air pollution
caused by industry off gases and vehicular
emission. Sulfur Oxides and Nitrogen Oxides (SOx& NOx) are two major pollutants, which are generally
believed to be precursors of acid rain and depletion
of Ozone layer and these have substantial damaging
effects on our health and environment. NOx also
reacts in the atmosphere to form ground- level
Ozone, bringing yellow smog in urban areas.
In response to the concern, worldwide action has
been taken to reduce SOx and NOx. India has
stringent SOx emission norms' following the
footsteps of US & Europe, but for NOx emission
control India is far behind western Countries. China
has recently imposed major policy reforms for NOx
emission in order to fight the adverse effects of NOx
on health and environment.
In modern India there is huge demand of Power,
Fuel and Petrochemical products for meeting the
day today requirements. Capacity augmentation oraddition of new plants is foreseen in all areas
including Refineries. To meet the product demand,
refineries are implementing state of art technologies
& up-gradation of existing operation, and the
measures being taken for NOx reduction include
installing low NOx burners on fired heaters and
boilers, water injection system in gas turbines. Such
methods reduce NOx generation, but do not
significantly remove the NOx which is generated.
Various technologies have been developed to
control emissions of nitrogen oxides. The SCR
(Selective Catalytic Reduction) process is by far the
predominant choice of technology. The SCR process
works by reacting the NOx with gaseous ammoniaover a vanadium catalyst to produce elemental
nitrogen and water vapor. It has been applied to a
variety of applications since the 1970s including flue
gases from boilers, refinery off-gas combustion, gas
and diesel engines, gas turbines and chemical
process gas streams. SCR is the technology which
gives the highest possible NOx removal rates.
NOx emissions from refineries primarily originate
from utility boilers, co- generation units, process
heaters, steam methane reformers, ethylene
cracking furnaces and FCC regeneration units.
Topsoe is a supplier of catalyst and technology for
environmental processes and has catalysts for NOx
reduction in operation in such units in several
refineries in the USA and Europe. The results from
SCR's installed in the process industry are that they
are very reliable and actually have very low runningand maintenance costs. By selecting SCR, plant
operators are getting a very forgiving system.
e.g. the burners in furnaces will not have to be tuned
to low NOx but can instead be tuned to optimum
combustion and stable flames which gives a safer
and more reliable operation of the furnaces.
The DNX® SCR catalyst is developed with a tri-
modal, highly porous pore structure which enables
the catalyst to tolerate high levels of chromium,
across a wide operating range of temperature.
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Figure 1: Basic Flow diagram for SCR Process.
The ammonia reducing agent can be either
anhydrous ammonia under pressure or it can be an
aqueous ammonia solution (typically 25% by weight)
at atmospheric pressure. A 30-40% solution of urea
which decomposes into ammonia and CO2 at high
temperature can also be used if warranted by safety.
The ammonia is evaporated in a heated evaporator
and is subsequently diluted with air before it is
injected into the flue gas duct upstream the SCRreactor. The SCR process requires precise control
Trouble-free operation has been achieved even with
the catalyst in a high-particulate atmosphere without
an ESP upstream the SCR. Also installation of
Topsoe's SCR on the highest NOx-producing units
serve as a buffer to the overall NOx-emission balance
of the refinery, allowing for compensation of higherNOx emissions of other sources, without exceeding
the refinery's cap of total NOx emission. In some of
the installation NOx reduction rate has been in
excess of 98% with slippage of ammonia up to
2ppm.
Fundamental of De-NOx Technology
NOx is the generic term for nitrogen monoxide, NO,
and nitrogen dioxide, NO2. At high temperature
gaseous ammonia will react with nitrogen oxides to
produce elemental nitrogen and water vapour. In the
presence of a catalyst, a lower reaction temperature,
typically 250°C - 450°C, can be used. Both versions
of the process - with and without a catalyst - are
used commercially. They are known as SCR,
Selective Catalytic Reduction, and SNCR, Selective
Non-Catalytic Reduction, respectively. The NOx
removal rates with SNCR are limited, typically around
60% whereas reduction of NOx over a vanadia-titania
catalyst can yield removal rates in excess of 95%.
Nitrogen oxides are primarily reduced according to
the following stoichiometry:
4 NO + 4 NH3 + O 2 4 N
2 + 6 H
2O
H 0 = -1,627.7 kJ /mol
NO + NO2 + 2NH3 2 N2 + 3 H2O H0= -757.9 kJ /mol
Nitrogen monoxide, NO, is the primary component
in flue gases, meaning that the first reaction is the
more significant one. As seen, NOx and ammonia
react in a 1:1 atomic ratio. A minor amount of NH3
and SO2 is oxidised in accordance with the following
reaction schemes:
4 NH3 + 3 O2 2 N2 + 6 H2O H0= -1,268.4 kJ / mol
2 SO2 + O
2 2 SO
3 H0 = -196.4 kJ / mol
The reactions are exothermal, resulting in a small
temperature rise of the flue gas having passed the
DeNOx catalyst.
Topsoe's SCR DeNOx Technology
The main components of the SCR system basically
are composed of a reactor with the catalyst, an
ammonia storage and injection system and a control
system. Figure 1 shows the typical Process Flow
Diagram of an SCR system. The abatement of
nitrogen oxides results from injection of ammonia
into the gas and subsequent passage through the
catalyst, forming elemental nitrogen and water. Ammonia is injected into the gas at slightly above
the molar equivalent ratio as its NOx concentration.
The ammonia injection rate is automatically
controlled by combining feed-forward control based
on amount of NOx to the SCR DeNOx unit and
feedback control measuring outlet NOx downstream
of the catalyst.
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Petroleum Federation of India88
of the ammonia injection rate. Insufficient injection
results in low conversion of NOx and an injection
rate which is too high results in an undesirable
release of unconverted ammonia to the atmosphere
referred to as ammonia slip. In the flue gas duct,
before the reactor, the NOx mass flow rate will varyacross the cross section area. A homogeneous
distribution of the ammonia in the flue gas is of
crucial importance to achieve efficient NOx
conversion. Topsoe's patented STARMIXER®
system placed in the flue gas duct helps in
achieving a uniform mixing of the ammonia with
the flue gas (Figure 2).
Topsoe has optimized design of a mixing system
for completeness of the chemical reactions, as well
as minimum ducting and an attractive plant layout
with the help of Computational Fluid Dynamics
(CFD). It also ensures a high degree of velocity
uniformity upstream the ammonia injection and at
the entrance to the catalyst layers and to verify
proper mixing of ammonia into the flue gas. Further,
it assists in optimizing the lay-out of ducts, reactor
and necessary flow control devices to minimize
overall pressure loss.
Catalyst
Catalyst is based on a porous titanium-dioxide
carrier material on which the catalytically active
components in the form of vanadium pentoxidecombined with tungsten- and/or molybdenum
oxides are dispersed. To cater for a large gas contact
area with a minimum pressure loss, the catalysts
has corrugated element containing a large number
of parallel channels (Figure 3).
Each type of catalyst is offered in a number of
different models with varying channel size (often
referred to as pitch), wall thickness and with varyingchemical composition adapted to specific operating
conditions. The choice of pitch and wall thickness
for a given SCR installation is determined mainly by
the concentration and properties of the dust in flue
gas. For low-dust applications, channel sizes of up
to approximately 5 mm are selected. Larger-channel
catalysts (6-10 mm pitch) should be selected for
operation in dust-laden gases in SCR units on e.g.
Fluid Catalytic Cracking (FCC) units in which FCCcatalyst fines are carried over from the regenerator.
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Comparison between Topsoe
Catalyst versus Extruded
A high porosity of the catalyst helps minimise the
SO2 -oxidation by providing a high fraction of SCR-
active surface vanadium sites. Figure 5 shows the
high pore volume of Topsoe's DNX® -type SCR
catalyst in comparison with extruded-types SCR
catalysts. The high porosity of DNX® is achieved
via a unique tri-modal pore structure, i.e. a pore
structure featuring pores in three size regimes.Extruded-type catalysts typically obtain the pore
volume from a micro-porous structure within a
narrow size range.
both the inner and outer surface of the catalyst. As
the outer surface fouls with foreign substances
deposited from the flue gas, maintaining access to
the interior becomes increasingly important. Large-
size pores, macro-pores, serve to ensure this access
to the active interior even if large amounts of poisons
have been deposited on the catalyst as illustrated
in Figure 6. The macro-pores further enhance gas-
phase diffusion of NOx and ammonia into the
catalyst and thereby the overall activity of Topsoe
Catalyst.
Figure 4: Different Channel Sizes to take care Particulate matter.
Figure 5: Pore volume in extruded SCR DeNOx
catalyst and Topsoe's DNX®
The pore volume of the DNX® catalyst is roughly
twice that of extruded catalyst types. The high
porosity is achieved from pores in three size regimes,catering to a high resistance towards poisoning. The
conversion of NOx on the catalyst takes place on
Figure 6: The tri-modal pore system of Topsoe'sDNX® catalyst (right) provides a high resistancetowards poisoning as the presence of macro-and
meso-pores ensures access to active sites.
Refinery SCR Application
SCR can be applied in various areas of refinery:
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Petroleum Federation of India90
It's very important to note that after assembling a
list of NOx emitting equipment, a refiner and its
consultant should review the options, taking in to
account the technology, catalyst availability, capital
costs and budget. Also installation of SCR on the
highest NOx-producing units serve as a buffer to
the overall NOx-emission balance of the refinery,
allowing for compensation of higher NOx emissions
of other sources, without exceeding the refinery'scap of total NOx emission.
One of the largest NOx emissions sources in a
refinery is the regenerator of the fluid catalytic
cracking (FCC) unit. FCC is the most important
process in a petroleum refinery and is used to
convert high-molecular weight hydrocarbons in the
crude oil to high-octane gasoline and fuel oils. FCC
catalysts are fine powders with crystalline zeolite
being the primary active component. The FCC unitconsists of the catalyst riser in which the
hydrocarbons are vaporized and cracked by contact
with the hot catalyst recirculated from the
regenerator. The mixture of catalyst and hydrocarbon
flows upward to the reactor where the hydrocarbons
are separated from the catalyst, which has
deactivated from depositing of carbonaceous
material, coke. The catalyst is returned to the
regenerator where it is regenerated by burning offthe coke with air blown into the regenerator. NOx is
produced in the regenerator from burning of nitrogen
contained in the coke.
Haldor Topsoe's design philosophy for FCCU SCR
applications calls for a vertical down flow unit. This
takes advantage of gravity to address the catalyst
fines entrained in the flue gas. Turning vanes are
required to prevent uneven stratification of the solids
and ensure a uniform velocity profile leading at the
inlet face of the SCR catalyst. The most economical
place for an SCR installation in an FCC unit is
upstream of the convection section.
Figure 7: SCR DeNOx Plant at Preem Refinery, Sweden
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Petroleum Federation of India 91
technology to achieve maximum NOx reduction and
SCR units for NOx abatement can be designed to
meet today's stringent requirements by offering
95%+ NOx reduction. SCR units have successfully
been installed on ethylene cracking furnaces and
steam methane reformers. NOx emission mainsource in a refinery is the flue gas coming from the
regenerator in the fluid catalytic cracking unit. It can
be the source of 50% of the total NOx emitted from
the refinery. The high sulphur oxides concentration
and carry-over of FCC fines in the flue gas represent
a challenge. With the use of a properly designed
SCR reactor and catalyst, experience shows that
very low levels of NOx emissions can be achieved
from FCC units that have high NOx, SOx and
particulates in the flue gas. Flow modelling by CFD
as well as cold-flow modelling in scale models of
the SCR unit is useful tools to verify proper ammonia
mixing and flow conditions to the catalyst as well as
to identify and eliminate areas for possible dust build-
up. Use of SCR also enables refiners to switch over
to cheaper & readily available fuel source (to avoid
use of NG).
Industrial Experience
Topsoe has a rich experience of implementing
DeNOx technology in various Industrial sectors i.e.
around 1152 references worldwide. The reference
mainly covers:
Fired boilers based Coal, Oil, Gas, Biomass andPetcoke : 282 units
Refinery / Petrochemical: 203 units
Gas Turbine application: 342 units
Stationary diesel engines: 107 units
From the above it is clear that there is a long list ofsatisfied customers, just to name a few:
Chevron Phillips, Cedar Bayou, Texas, USA (ethylene plant)
Shell, Deer Park Refinery, Texas, USA
CITGO Petroleum, Lemont Refinery, Illinois, USA
Preem Refinery, Gotenburg, Sweden
Conclusions
Selective catalytic reduction, SCR, is the best proven
Life is ten percent what happens to you and ninety percent
how you respond to it.“ “
~Lou Holtz
The good life is one inspired by love and guided by knowledge.
“
“
~Bertrand Russell
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Petroleum Federation of India92
Olefins Technology Options to Meet Uncertain Market Conditions
Tanya Aggarwal, AssociateTechnical Professional
KBR Technology
Sourabh MukherjeeChief Technical Leader
KBR Technology
Sagar Nawander Associate Technical Professional
KBR Technology
During the second quarter of 2014, the world
witnessed an unprecedented slump in the
global crude oil prices that precipitated a
flurry of speculations about the future of crude oil
price. International Energy Agency (IEA) cites weak
demand, a strong dollar, and booming U.S. shale
oil production, exacerbated by the unwillingness of
the OPEC countries to reduce production, as the
major reasons behind this fall.
While the prices have managed to scale upwards
from the historic drop to less than 45 USD in March
2015, emerging above 60 USD since May 2015, the
trajectory that the production and supply/ demand
curves shall trace in the coming months cannot be
predicted with certainty. Geopolitical scenario does
not allow even the most practiced pundits to make
sure claims, as in the near future Iranian oil is
expected to be freely traded in the global crude
market, and OPEC's unwillingness to wind down the
production levels to bring the market to an
equilibrium against the rising demand and shale oil
production levels.
In the last decade, prices of petrochemicals have
become very sensitive to movement in crude oil
prices. There has been a surge in demand for
petrochemicals from the emerging economies of Asia, notably China and India, and in North Western
Europe and the Mediterranean.
Hydrocarbons like naphtha, ethane, propane,
butane, and fuel oil serve as feed for producingethylene and propylene, the two major basic
chemicals- which further serve as feed stocks for
downstream polymerization units producing
polyethylene and polypropylene. Steam cracking of
naphtha, LPG, and ethane feeds has been the
ubiquitous process used in the manufacture of
ethylene and propylene, with the yields of ethylene
being higher than those of propylene. Catalytic
cracking, on the other hand, is known to favorpropylene over ethylene and has a proclivity for
heavier feeds.
(Reference: International Business Times)
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Petroleum Federation of India 93
World Olefins Market
Ethylene: Feed stock prices, being a primary factor
guiding ethylene production costs, have allowed a
shift of steam crackers from demand rich regions to
territories that boast of favorably priced feed stocks.
This is evident from the spurt of new ethylene plant
announcements in the USA, owing to the shale gas
boom (though with the weaning of naphtha prices,
this cost advantage merits a relook). China is an
exception to this general trend, where demand still
drives the establishment of ethylene production
facilities. China also seeks to champion technologies
that could allow it to exploit its abundant coal
reserves and investments in coal-based ethylene
will, perhaps, contribute about half of all announced
capacity additions there.
The reducing availability of ethane supplies in the
Middle East, as well as the need felt to broaden their
product portfolio to counter the US Shale gas wave,
will see producers there focus on integrating steam
crackers with refinery projects.
Propylene: The global propylene and derivativesmarket is in the midst of a metastasis. The gradual
tilt towards lighter feeds among steam cracker
operators has spawned developments that affect
the type and location of new investment, regional
pricing levels, and profitability for the producers of
propylene and derivatives. The reduction of
propylene supplies from steam crackers and
refineries, coupled with growing propylene prices,
is driving investments in targeted production, mainlythrough propane-dehydrogenation and, in China,
through coal-based processes. Polypropylene is
expected to remain the largest propylene derivative
well into the future.
Ethylene Plant Economics
The ethylene industry is highly cyclical and sees
heavy swings in profitability due to uncertainfluctuations in product prices. For example if we look
at butadiene, one of the major co-products from a
Liquid cracker, we observe extreme price swings
over the last 5 years. While we can perhaps foresee
trends in the industry over the next couple of years,
taking a call on the long term scenario is more
challenging. Ethylene production cost rides on
several factors that govern the plant economics likecosts of feed stocks, variable and fixed expenditure,
and the value of the co-products.
To be able to counter the variability of feed costs,
processes need to introduce flexibility into
operations, such that different feeds can be
processed as and when their prices are lower.
Integrating steam crackers with adjacent refineries
to upgrade lower value refined products to olefin
feedstock becomes quite economical.
Maximizing the value of co-products like propylene,
butadiene, pyrolysis gasoline, and fuel oil, also helps
offset the cost of production and enhances the
profitability margins for ethylene producers.
To respond to changing market dynamics, operating
flexibility becomes an invaluable foundation of any
new grassroots plant or revamp project, allowing
the producer to continuously adjust operations to
maximize profit at any given time with small,
justifiable increase in capital outlay.
KBR Olefins Technology Portfolio
With challenging market needs, Petrochemical
producers are seeking innovative ways to elevate
the value of their products while minimizing the cost
of production. KBR offers a suite of technologiesthat target enhanced operational flexibility and
maximize the value of ethylene crackers.
SCORETM Technology
KBR SCORETM Ethylene technology is the
combination of three leading Olefins Technologies.
MW Kellogg, which pioneered research on short
residence time cracking to improve the furnace
yields, collaborated with C. F. Braun, the industry
leader in optimized recovery section design and the
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Petroleum Federation of India94
innovators of the De-propaniser first and De-
ethaniser first recovery schemes. In the late nineties,
we went into partnership with Exxon Mobil- the
leaders in Ethylene production and profitability- thus
integrating Exxon Mobil's research and development
on Furnace improvements, reliability, andmaintainability into our technology.
Being a leader in olefins technology development
and construction for over 50 years, KBR provides
cost-effective designs for the production of ethylene,
propylene, butadiene, and other by-products using
feed stocks ranging from ethane to vacuum gas oils.
Since the 1990s, over twenty new ethylene plants
based on KBR Technology have been brought on-
stream, producing a combined ethylene capacity
of 13 million metric tons per year. Through
continuous improvement and technology
innovations, KBR SCORE™ Technology has
established itself as one of the pioneers in the
development of Ethylene technology.
SCORE technology confers several advantages:
- Cracking furnaces that provide the highest
olefins yields available in the industry,
- Low-capital, high-efficiency product recoveryscheme based on low-pressure distillation towerdesigns. Depending on the feed, KBR SCOREEthylene technology may produce 4 to 12percent more ethylene than typical designs, withless energy input per unit of ethylene produced.
- Unmatched feed flexibility to the operatorthrough our unique "Hybrid Cracking" feature.
SCORE is distinguished by our furnace coil portfoliocovering the broadest range of reaction times in
industry (with single pass (SC-1), two pass (SC-2),
and serpentine (SC-4) coil designs), by its low
CAPEX design and superior performance in
reliability, operability, maintainability and flexibility.
When revamping or setting up a grassroots plant,
proper selection of pyrolysis technology with the right
ethylene selectivity is critical.
Hybrid Cracking: Considering the fluctuations in
product prices and high price of energy in the
HybridCracking
market, operators are seeking the
ability to handle different blends of
feedstock to maximize profits. KBR
offers the unique benefit of hybrid
cracking. SCORE furnaces are
extremely flexible and are designed tocrack multiple feeds in the same
furnace at the same time, each at the
most optimum cracking severity. For
instance, a single SCORE furnace can
crack fresh ethane feed (plus recycle
stream) in selected passes at high
conversions to limit recycles, while the balance of
the furnace may be cracking naphtha at low severity
to maximize propylene yield. This allows the plantto be designed with a superior degree of feedstock
flexibility while maintaining a small number of large
capacity furnaces, reducing overall cost. The figure
alongside depicts the hybrid cracking concept with
four passes of the furnace handling ethane/propane
feed and the other four passes handling
naphtha feed.
As a result of this unique feature, a KBR SCORE
liquid cracker would not require a dedicated "Recycle
Gas" furnace to accommodate the recycle Ethane
stream, hence reducing the number of furnaces in
the complex.
KBR designed SCORE furnaces are successfully
handling feed stocks, which range from as light as
ethane to as heavy as gas oils, in the same plant
using Hybrid Cracking.
KBR K-COTTM Technology
While KBR SCORE Steam Cracking technology
provides unique advantages in terms of handling
multiple feed stocks in the same unit, KBR K-COT
offering augments flexibility by allowing cracking of
olefinic feeds, which is not possible in traditional
Steam crackers.
KBR K-COT technology can use feed stocks as
diverse as:
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Petroleum Federation of India 95
commercially proven catalytic olefins technology
which can:
Use as feed stock olefins-rich feeds, such assteam cracker by-products and C4 gasolineproduced from refinery FCC and Coker unitsand/ or commonly available, straight runparaffinic feeds,
Crack them to produce a higher quantity ofolefins than conventional pyrolysis, with P/Eratios between 1:1 and 2:1 depending on feedtype,
Easily be integrated with revamp or grass rootsEthylene plants.
Since the steam cracking and refinery sources will
not be able to keep pace with future propylene
demand, "on-purpose" propylene technologies arebecoming more prevalent. Existing naphtha
crackers, comprising nearly half of all ethylene
production capacity worldwide, would perhaps
continue to depend on the crude oil price, which
likely to stay unfathomable at present, as also in the
immediate future.
KBR studies, using actual feed/product price from
the past six years certify KBR K-COT technology's
capacity to ensure very good economics, under
different feed and product pricing scenarios.
With market trends expected to guide future
investments, operators will be well advised to take
a holistic view, and make production more integrative
by opting for technologies that offer maximum
flexibility to meet uncertain pricing scenario.
Typical Refinery and Steam Cracker
- Straight- run paraff inic streams from C4s
onwards to heavy naphtha - producing a
Propylene/Ethylene ratio of ~1/1.
- Olefins-rich feeds such as steam cracker by-
products or Refinery streams ranging from C4s
to FCC/Coker/ Visbreaker Naphtha producing
a Propylene/Ethylene ratio of ~2/1.
- Fischer Tropsch Naphtha (from Coal
Liquefaction process)
- Oxygenates such as methanol or ethanol.
Presently, propylene is predominantly obtained as
a by-product from steam cracking and refinery FCC
units. However, the annual growth in propylene
demand is expected to exceed 5% over the next
few years. With the ethylene market expected to
grow at a slower pace than that of propylene,propylene supply from neither ethylene expansion
nor new FCC units is expected to meet the demand.
KBR's Catalytic Olefins Technology (K-COT) offers
flexibility to use many types of feeds, targets
propylene as a primary product, and produces a
number of valuable products.
K-COT uses the fluidized catalytic cracking (FCC)
process, which is similar to a traditional refinery FCC
unit. KBR has spearheaded FCC technology ever
since its construction of the world's first FCC Unit
for ExxonMobil in Baton Rouge, Louisiana in 1942,
and has licensed several units worldwide.
KBR's patented catalyst design with continuous fuel
firing is commercially proven. The recovery section
for the plant is very similar to that used in steam
cracking designs. K-COT targets propylene and
aromatics yields.
K-COT converters can either be integrated with a
steam cracker or be used as a stand-alone unit toget high propylene yields from straight-run naphtha
feed. The substantial volatility in prices of naphtha
feed, and various ethylene plant by-products,
governs the optimal choice.
Conclusion
To remain competitive, steam crackers of the future
will need to be flexible and agile to meet the market
challenges. Apart from its proven feed flexible steam cracking
technology, KBR offers extremely flexible,
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Petroleum Federation of India96
Megha AggarwalSenior Engineer (R&D)
Engineers India Ltd.
Vijay YalagaDy. Manager (R&D)Engineers India Ltd.
Dr. R. N. MaitiDy. General Manager (R&D)
Engineers India Ltd.
Vartika ShuklaGeneral Manager (R&D)
Engineers India Ltd.
Trickle Bed and Slurry Bed Reactors in Refining Industry
Present day requirements of improvedconversion and product quality have
brought hydroprocessing to the forefront of
refining operations. As there is a depletion of
conventional light and sweet crude, the crude oil
will be heavier in the future. So, importance of
hydroprocessing (viz hydrocracking, hydrotreating,
hydrodesulfurisation) will be enhanced, i.e.
application of catalytic reactors used in
hydroprocessing will be more.
Most of the hydroprocessing reactors are fixed bed
of solid catalyst particles contacted by trickling flow
of liquid in presence of gas, carrying both reactants
and products downwardly. These trickle bed type
reactors(TBRs) are usually operated at elevated
pressures of about 2-30 MPa in order to slow down
catalyst deactivation, increase the concentration of
the gaseous component in the liquid phase, attain
high conversion, achieve better heat transfer and
handle large gas volumes at less capital expense.
However, with increased processing of heavy sour
crudes, upgradation of heavy oils containing
asphaltene, S, N, heavy metals (Ni, V) with fixed bed
hydrocracking face a critical problem of catalyst
deactivation caused by coke deposition.
Hydrocracking in slurry phase is suitable to solve
this problem due to achievable high conversionthrough enhanced mass transfer rate and good
temperature control. In this process a small amountof catalyst and hydrogen is mixed with feed and the
mixture is sent to the reactor chamber where the
hydrocracking conversion occurs.
Hydrocarbons will continue to be our major source
of energy in the future; whereas the demand and
supply gap are growing and to be met by imports.
One of the other efficient way of reducing oil
consumption by refinery is resource exploration by
way of utilization of coal and petcoke to syngas and
conversion of syngas to premium quality diesel
through Fischer-Tropsh synthesis in slurry bubble
column reactor in presence of solid catalyst. The
diesel obtained through this FT synthesis has a
cetane number >70 which may be used in quality
improvement of product mix.
Hydrodynamics of these trickle bed and slurry phase
reactors which ensure proper distributions ofreactants for efficient contact and removal of product
from reaction site are extremely important for fullest
utilization of highly active catalyst developed by
catalyst manufacturers to meet the stringent
specifications of environment friendly fuels. The
following sections detail the hydrodynamic aspects
of trickle bed and slurry bed reactors, an important
category of multiphase reactor used widely in oil
industry along with capabilities built up at EIL - R&Dcenter.
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catalyst. The observed and expected reaction rates,
when the particles are fully covered with liquid, are
directly related to partial wetting of the catalyst. It is
generally recognized that pressure drop, liquid
holdup, wetting efficiency, i.e., surface coverage by
liquid and gas, other reactor parameters are closelycoupled to these complex flow pattern and
distribution. So one of the major challenges in design
and operation of this type of reactor is the
understanding of the fluid distribution at macro, i.e.,
bed level as well as at the micro, i.e., particle level.
Figure 1: Flow Regimes
In the macro level, the distribution of phases is well
established along with prediction of flow boundaries
of various flow regimes like trickling flow, pulsing
flow, spray flow, and bubble flow (Figure 1). In the
trickling flow regime, the liquid flows down the
column from particle to particle on the surface
of the packing while the gas phase travels in
the remaining void space of the flow channels.
At the micro or part ic le level, the liquid flow
texture in a bed consists of a number of
features: liquid flows as films, rivulets over the
particles, pendulum structures, liquid-
filled channels and liquid-filled pockets
(Figure 2).
Hydrodynamics of Trickle Bed
Hydroprocessing Reactors
Most of the hydroprocessing reactors are fixed bed
of solid catalyst particles contacted by trickling flow
of liquid in presence of gas, carrying both reactantsand products downwardly. In general, the reaction
occurs between the dissolved gas and liquid phase
reactant at the interior surface of the catalyst. In some
cases, the liquid phase may be an inert medium for
contacting the dissolved gaseous reactant with the
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pressure and with hydrocarbon system (Figure 2).
Pressure drop profile, liquid distribution and liquid
dispersion studies data generated for
hydrodynamics with various packings, operating
fluids system. Correlations for pressure drop, liquid
holdup and wetting efficiency have been developedand flow regime maps have been generated.
Column dial: 15/30 cm
Packed bed height: 1.7/2.0 m
Design pressure: 40 bar
Distributor: chimney type
Liquid collector: annular
Operating liquid: hydrocarbon
Trickle Bed Reactor Internals
Reactor internals are located at the reactor inlet, inter
bed zones, and at the reactor outlet. Various types
of internals present in TBRs are inlet diffuser,
distributor tray fitted with various types of distributors,
quench system, catalyst support grid, outlet
collector, layers of inert balls, etc. as shown in Figure
3. Among these internals, the most important are
the distributors placed above the catalyst beds.
Figure 3: Typical Trickle-bed reactor with different
internals
The relative amount of these features are expected
to vary with factors such as inlet distribution of gas
and liquid, size and shape of the packing, wetting
properties, method of packing, method used for
start-up operation, gas and liquid flow rates and fluidphysical properties.
Most of the published information on hydrodynamics
are at atmospheric pressure and air water system.
At present, an engineer attempting to evaluate the
hydrodynamic parameters needed for design or
scale-up, such as external liquid holdup, flow regime
and pressure drop, has to wade through a jungle of
numerous correlations. The discrepancy in
predictions can be very large. Hence, in companies
that have experience with fixed beds with two-phase
flow, one normally ends up using and relying on the
"in-house" unpublished proprietary correlations
generated in their cold stand setup at simulated flow
conditions.
Cold Flow Trickle Bed Reactor
Facilities at EIL-R&D
Various sizes of cold flow facilities have been created
at EIL R&D to generate hydrodynamics at high
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The extent of uniform distribution of liquid through
the catalyst bed at micro level is grossly affected
by proper design and functioning of reactor
internals. Poor liquid distribution can contribute to
channeling through catalyst bed resulting in
inefficient utilization of the catalyst, development ofhot spots and catalyst deactivation due to coke
formation. The parameters that are important in the
design of a vapor liquid distributor tray for a trickle
bed reactor are drip point spacing, tray levelness,
plugging, proper liquid mixing, pressure drop, and
flow at various conditions. Several designs of
distributor are used in TBR. Most of the known
designs of vapor liquid distributors fall into one of thefour categories (Figure 4a-d) i.e., sieve tray, chimney
tray, bubble cap tray, and vapor assist lift tube.
Figure 4: Typical distributors: (a) Perforated tray, (b) Multiport chimney, (c) Bubble cap (d) Vapor lift tube
Several designs of distributor trays are commercially
available:
(1) Perforated Tray/Sieve Tray Type Distributors-
These are the earliest type of distribution trays used
in the trickle bed reactors. They consist of aperforated tray or sieve tray with gas chimneys. This
tray is simple to construct and is capable of providing
the greatest number of drip points over the cross
section of the catalyst bed.
(2) Chimney Type Distributors- These designs have
chimneys evenly spaced across the distribution tray.These chimneys allow the vapor to pass through
the top opening. The liquid flow is distributed through
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weep holes or notches cut into the side of riser. This
design eliminates the sensitivity to plugging. This
type of device is essentially equivalent to a
perforated tray with elevated liquid ports. A further
improvement of this simple chimney distributor is
the multi-port chimney. This distributor design hasweep holes spaced vertically up the axis of the
chimney, which provide greater flexibility to changing
vapour/liquid ratios. These have increased tolerance
to tray levelness problems.
(3) Bubble-cap Type Distributors - Bubble-cap
design operates on a vapour assisted principle
compared to liquid overflow principle employed in
the chimney type distributors. In this design, vapour
passing through slots in the bubble cap aspirate
liquid held up on the tray, carrying it over a central
down comer. The bubble cap design is much less
sensitive to tray levelness than others because the
liquid on tray is carried by the vapour. It is also less
sensitive over a broad range of liquid loading.
Another advantage of this type of distributor is that
it acts like an additional quenching device, bringing
the liquid and vapour closer to an equilibrium
temperature before they enter the catalyst bed. Also
this is less prone to fouling compared to chimney
type distributor.
(4) Vapour-lift Distributor- These distributors
incorporate all advantages like vapour liquid mixing,
low vulnerability to plugging normally associated with
vapour assist distributor such as bubble-cap
distributor tray. But this tray has much smaller
diameter chimney, which enables the installation ofmore distribution points across the tray area. These
distributors exhibit very stable, low sensitivity
operation over a broad range of vapour/liquid ratios.
Drawbacks Connected with
Hitherto known Devices
A number of problems are encountered in the use
of these known distributing devices. Perforated tray
type distributors have high sensitivity to tray
levelness. The perforations can easily be plugged
by coke, corrosion products or other particles carried
into the reactor by the feed. The main disadvantage
of bubble cap type distributor is that it requires large
diameter and thus less number of drip points on tothe catalyst bed. Vapour-lift design is basically a
vapour assist distributor like bubble cap distributor
and the vapour assist distributor; in general have
the problem of non-uniform secondary
distribution.
In chimney type distributors, the liquid flow is
governed by the overflow principle. This design is
also very sensitive to the tray levelness and changesin liquid loading. It offers fewer drip points than the
perforated tray. To provide the turndown capability,
these distributors are designed to maintain a liquid
level at the design conditions above the level of the
weep holes or notch bottom. If the feed rate is
increased or a heavier feed is processed, the level
on the tray will increase and can flood over the top
of the chimney.
To overcome the above disadvantages in chimney
distributors, EIL has developed a novel chimney
distributor tray (Figure 5). It consists of a central pipe
top covered with circumferential opening at top end
for gas entry and annulus pipe (top opened) with
holes at pipe wall at various axial locations for liquid
entry to the annulus region. Bottom of the distributor
is fitted with a basket type assembly with notched
skirt attached for mixing and lateral spreading. Gasenters into the gas tube from top end and liquid
enters from the annulus in to the gas tube at the
bottom end, get mixed and distributed uniformly on
catalyst bed after intimate mixing through secondary
distributor. The distributor provides high density of
primary distribution points, good quality secondary
distribution of liquid, operates at high turndown ratio
and is resistant to fouling.
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Figure 5: Modified Chimney Distributor with
Secondary Vapor - liquid Distribution
To study the performance of the internals, it is always
better to have a large size cold stand. A large scale
cold flow facility (120 cm diameter column) has been
created at EIL R&D, Gurgaon for generating
hydrodynamic performance data (Figure 6) fitted
with all the reactor internals (inlet diffuser, distributor
tray, quench box, out collectors etc). The modified
chimney distributor has been developed, evaluated
in this large diameter column and implemented
commercially for diesel hydrotreating at IOCL- BGR.
Figure 6: Large Scale Cold Flow Facility at EIL-R&D,
Gurgaon (1.2 m dia column)
Figure 7: Typical Slurry Bubble Column
The main attractive features of slurry bubble columns
are:
- A high liquid mixing which should providehomogeneous catalyst concentration andtemperature distributions.
Hydrodynamics of Slurry
Phase Reactor
Bubble column reactors are invariably chosen as
the reactor type for carrying out relatively slow liquid-
phase reactions and where the liquid-phase backmixing is a desirable feature in order to achieve
temperature equalization that is important for
exothermic reactions. It is important to have enough
information on the hydrodynamics of the multiphase
reactors (SBCR) such as gas holdups, gas-liquid
mass transfer, liquid re-circulation etc.
Slurry bubble column reactors are simple vertical
cylindrical vessels with intense contact between gas,
liquid and solid phases. In most applications, gas
is the reactant; liquid is the product of reaction and
solid is the catalyst. The "liquid + solid particle"
suspension can be represented as a homogeneous
fluid phase and is named as slurry. The gas phase
is dispersed into the slurry phase using specific gas
distributors at the bottom of the column. A simplified
representation of a slurry bubble column is shown
in Figure 7.
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- The use of small catalyst particle size (about50 m), which reduces intra-particle diffusion.
- Easy catalyst addition and withdrawal from thereactor.
- Low-pressure drop.
In particular, slurry bubble column reactors aresuitable for carrying out highly exothermic reaction,
such as methanol synthesis or Fischer-Tropsch
synthesis.
There are considerable reactor design and scale-
up problems associated with the slurry bubble
column reactor. Firstly, large gas throughputs are
involved, necessitating the use of large diameter
reactors, typically 5-8 m, often in parallel. Secondly,
the process operates under high-pressure
conditions, typically 30-40 bar. Thirdly, in order to
obtain high conversion levels, large reactor heights,
typically 30 m tall, are required along with the use of
highly concentrated slurries, approaching 40 vol%.
Finally, the process is exothermic in nature, requiring
heat removal by means of cooling tubes inserted in
the reactor. Reliable design of the reactor to achieve
high conversion levels requires reasonable
information on the gas holdup, bubble size
distribution and type of distributor to ensure uniform
distribution of gas/liquid.
The effect of various parameters (superficial gas
velocity, pressure, gas density, physical properties
of liquid, solid concentration, column size and gas
distributor) has been studied through available
literature. Various authors developed the gas holdup
correlations at ambient pressure conditions.
However they did not take into account the effect of
pressure.
Cold Flow Slurry Bed Reactor at
EIL-R&D
Experimental facilities have been created at EIL-R&D
complex to study the effect of various parameters
(superficial gas velocity, pressure, gas density,
physical properties of liquid, solid concentration,
column size and gas distributor) on slurry
hydrodynamics. Two different sized slurry bubble
column reactors have been setup viz. 0.45 m and0.2 m dia column respectively. The design pressures
of both the columns is 12 barg and to operate at
ambient temperature. There is a provision to
measure the differential pressure across six points.
There is a facility for changeover of the distributor at
the bottom of each column. Two types of distributors
viz. sieve plate and spider type have been tested
for hydrodynamics with slurry phase at ambient
temperature, water & hydrocarbon liquids and with
solids.
The hydrodynamic design information of slurry
reactor can be generated under wide range of
pressures, superficial gas velocities, solid
concentrations (0-30 vol. %) and with different
distributors (spider and Sieve plate) towards design
of slurry bed reactors
Conclusions
Apart from highly active catalyst, hydrodynamics is
an important factor for fullest use of catalyst potential.
Due to presence of solid, gas and liquid,
understanding of hydrodynamics in trickle and slurry
bed type reactor and design of suitable distributors
is a challenge. In case of trickle bed reactor,
important hydrodynamic parameters for design are
pressure drop, liquid holdup and wetting efficiency.These are influenced by particle level hydrodynamic
phenomena like flow texture which is linked to
uniform distribution of liquid. Internals like chimney
distributor with dense drip points and with lateral
spreading ensures the proper flow regime and
catalyst wetting for exploiting benefits of highly active
catalyst. Similarly in case of slurry reactor, the
distribution of gas/liquid and formation of various
sizes of bubbles depends on distributor at thereactor inlet.
Cold experimental facilities with various column sizes
(15 - 120 cm dia) for trickle bed and (20-45 cm dia)
for slurry bed fitted with important reactor internals
have been created at EIL-R&D complex to generate
data bank for hydrodynamics and for evaluation of
various types and sizes of packings and internals
used in Trickle and slurry bed reactors, important
category of multiphase reactors used in refining
industry.
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Members’ News in Pictures
Mr. Dharmendra Pradhan, Hon'ble Minister of State (Independent Charge), Petroleum and Natural Gas
(4th from left) urged fellow countrymen to voluntarily give up their LPG Subsidy at a function held at Bengaluru in the
presence of Mr. S.C. Khuntia, SS&FA, MoP&NG (2 nd from right), Mr. S. Varadachari, GM (I/c), Karnataka
(extreme left); Shri K. K. Gupta, Director (Mktg.), BPCL (2 nd from left).
Shri Dharmendra Pradhan, Hon'ble Union Minister of State (Independent Charge) for Petroleum and Natural Gas
inaugurated the Patna project office of GAIL (India) Limited for the construction of the Jagdishpur - Haldia pipeline on May 25, 2015 in the presence of Shri Giriraj Singh, Hon'ble Union Minister of State for Micro, Small &Medium Enterprises; GAIL Chairman and Managing Director, Shri B. C. Tripathi; Director (Projects), Dr. AshutoshKarnatak and other dignitaries.
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A full-fledged Customer Awareness Week was organized in Nashik, Sholapur and Ahmedabad as part of Bharat Mela-"Saal Ek, Shuruwat Anek". At Nashik the event was launched by Social Worker, Mr. Suhas Pharande, in the
presence of Shri M S Patke, GM (Brand & PR), Shri K. Ravi, Regional Manager Lubes (West), BPCL Territory Managers and others on 26 May 2015.
The Hon'ble Union Minister of State (I/C) for Petroleum & NaturalGas, Shri Dharmendra Pradhan (extreme left)at the first StrategicCrude Oil Storage facility at Visakhapatnam on June 25, 2015.Other (L-R): Shri A. K. Sawhney, Additional Secretary, MoP&NG;Shri S. Poundrik, Joint Secretary (Refinery), MoP&NG (at the back); Shri H. P. S Ahuja, Deputy CEO, ISPRL; Shri K. D. Tripathi,Secretary, MOP&NG; Shri Rajan K. Pillai, CEO&MD, ISPRL.
Hon'ble Minister of State (I/C) for Petroleum and Natural Gas,Shri Dharmendra Pradhan (sitting centre) reviewing the performance of NRL during his visit to Numaligarh on 16th of April' 15. Also seen in the picture are Hon'ble MPs from Jorhat and Dibrugarh, Shri Kamakhya Prasad Tasa (sitting 4th from right) and Shri Rameswar Teli (sitting 3 rd from right); NRL MD Shri P.Padmanabhan (sitting 1 st from left), NRL Director (Technical)Shri S. R. Medhi (sitting 2 nd from right); NRL Director (Finance)Shri S. K. Barua (sitting 1 st from right); Ministry officials and senior officials of NRL.
Bharat Petroleum Corp. Ltd. wasdeclared Public Sector Unit of the Year at the premier edit ion of the ICICILombard & CNBC - TV18 India RiskManagement Awards. This award for the best processes and practices adopted by BPCL in ri sk management was presented to Shri . S. Varadara jan,Chairman & Managing Director (extreme left) in New Delhi on 7th May 2015.
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Unveiling of Inaugural Plaque of Polypropylene Unit at MangaloreRefinery and Petrochemicals Limited by the Hon'ble Minister for Petroleum & Natural Gas, Shri Dharmendra Pradhan.
Ms. Veena Swarup, Director (HR) has been honoured as Legend Director of the Year 2014 by News Ink Media. She received the award from Hon'ble Governor of Haryana Prof. Kaptan SinghSolanki during News Ink Legend PSU Shining Awards 2014function held on April 27, 2015 in New Delhi.
'Breaking Barriers', a book on organizational change management, authored by Shri Satchidananda Rath, Director (Operations), Oil India Limited and Shri Prakash Deka, Chief Manager (Vigilance), Oil India Limited, was released on May 26,2015 at the SCOPE Complex, New Delhi by Shri S.K. Srivastava,Chairman & Managing Director, OIL in the presence of Dr. U.D.Choubey, Director General, SCOPE, Chief Guest at the event.Guests of Honour were Shri S. Mahapatra, Director (E&D), Shri Anand Kumar, IPS, CVO and Shri N.K.Bharali, former Director (HR&BD), OIL.
Shri Vishnu Agrawal, Director (Finance), MRPL (extreme left) was adjudged winner of the 'BT-STAR Excellence Award in thecategory PSU-small,-DIRECTOR-FINANCE OF THE YEAR' by the Jury of the BT-Star Excellence Awards 2015. Others (L-R): Hon'bleLieutenant Governor of Andaman & Nicobar Islands, Lt. General A. K. Singh (Retd.); Ustad Ghulam Ali, Pakistani Ghazal Singer.
HPCL sole winner of CII Supply Chain And Logistics Excellence (SCALE) Award inOil & Gas Industry.
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EIL organized an interactive Supplier Meet for 'MAKE IN INDIA' programme inMumbai on April 28, 2015 which was attended by suppliers from Mumbai and Pune belonging to Fabrication, Bulk,Pump, Electrical and Instrumentation indust ries. Shri Sanjay Gupta, thenDirector (Commercial); Shri Ajay
Deshpande, Director (Technical); Shri A.K. Chaudhary, ED (Inspection); Shri Niraj Sethi, ED (CS & BD) and several other senior officials from EIL graced theoccasion.
Oil India Limited was conferred the 'Certificate of Merit - BelieversCategory', at the Frost & Sullivan's Green ManufacturingExcellence Awards (GMEA), 2015. The certificate was received by Mr. A.C. Patowary, General Manager (E&I), OIL on behalf of Oil India Limited from Mr. Gowtham Sivabalan - AssociateDirector, Frost & Sullivan, Middle East, North Africa & South Asia, at the Award function held on May 22, 2015 in Mumbai.
Memorandum of Understanding (MoU) being signed on20th April, 2015 at Dhaka between GM (Mktg. & BD) NRL-Mr. B. Ekka (sitting left) and GM (Planning and Development),Bangladesh Petroleum Corporation - Mr. Mustafa Qudrat-I-Elahi (sitting right) in presence of MD NRL Mr. P. Padmanabhan,Chairman Bangladesh Petroleum Mr. A. M. Badrudduja and senior Govt, NRL and BPC officials. The MoU provides for export
of petroleum products from NRL's Marketing Terminal in Siliguri to Bangladesh Petroleum's Depot at Parbatipur through the proposed 130 kms 'Indo-Bangla Friendship Pipeline (IBFPL)'.
Rajasthan State Gas Limited (RSGL) has signed Heads of Agreement (HoA) with GAIL (India) Limited to procure
natural gas which will pave the way for dispensing of CNG along Delhi-Jaipur Highway corridor and distribution of Natural Gas to various industrial clusters in Rajasthan. The agreement was signed on May 1, 2015 in the presenceof GAIL Director (Marketing), Shri Prabhat Singh by GAIL Zonal General Manager, Jaipur, Shri S. Bairagi and RSGLManaging Director, Shri Ravi Agarwal.
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Swachh Mangaluru. Swachh Bharat - Flag off by the Hon'bleUnion Minister of State (I/C) for Petroleum & Natural Gas (extreme right) organised by Mangalore Refinery and PetrochemicalsLimited when Managing Director, Shri H. Kumar was also present.
Boat Clinic 'Kaliyani' sponsored by NRL as part of its CSR activities being formally inaugurated by MD NRL Mr. P. Padmanabhan(right) in presence of Managing Trustee C-NES Mr. Sanjay Hazarika (left) and Director (Finance) NRL Mr. S. K. Barua (center)on 18th of May 2015 at Guwahati. The boat clinic would cater tothe medical needs of the marginalized and needy people inhabi ting the numerous sand bars dott ing the mighty Brahmaputra in Kamrup District of Assam.
Managing Dierctor, MRPL, Shri H. Kumar reiterates MRPL'scommitment to the Nation at the function.
A series of retail initiatives were launched by IndianOil during AllIndia State and Regional Heads' Conference held at MarketingHead Office, Mumbai recently. The XTRAPOWER Rural card was launched by Mr. B. Ashok, Chairman, IndianOil by handing over
a replica to Mr. U. V. Mannur, ED, TNSO in the presence of Mr. A.K. Sharma, Director (Finance). This is a first-of-its kind initiative in the oil industry and potentially 20% HSD sales can be tapped through the Rural card.
Hon'ble Minister of State (I/C) for Petroleum &Natural Gas,Shri Dharmendra Pradhan handing over a motorized tricycleduring EIL's CSR Camp at Bhubaneswar on June 20, 2015. Theevent was also graced by Dr. Sruti Mohapatra, an eminent socialworker and champion of disability causes in Odisha, Ms. VeenaSwarup, Director (HR), EIL and other senior officials from EIL & Artificial Limbs Manufacturing Corporation of India (ALIMCO).
Mr. Dharmendra Pradhan, Hon'ble Minister of State for Petroleum& Natural Gas and Mr. Sarbananda Sonowal, Hon'ble MoS (I/c)Ministry of Youth Affairs and Sports Visited IndianOil (AOD) installations at Digboi. Mr. Sanjiv Singh, Director Refineries,D-I-C (AOD) welcomed and felicitated the Ministers.
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The Hon'ble Union Minister of State (I/C) for Petroleum & NaturalGas, Shri Dharmendra Pradhan inspecting the strategic crudeoil storage facility at Visakhapatnam.
The First International Yoga Day on 21 st June 2015 was celebrated with enthusiasm and vigour by employees of IndianOil's ParadipRefinery by participating in the mass Yoga Camp arranged at Jawaharlal Indoor Stadium, Cuttack. The event was inaugurated by Hon'ble Union Minister of State (I/c) for Petroleum and NationalGas, Mr. Dharmendra Pradhan.
Shri Sanjay Gupta, C&MD, EIL receiving the India Pride Award 2014-15 in "Excellence in CSR/Environment Protection &Conservation" category from Shri Arun Jaitley, Hon'ble UnionCabinet Minister for Finance, Corporate Affairs and Information& Broadcasting during an Award function organized by DainikBhaskar on June 4, 2015 in New Delhi.
Mr. B Ashok, Chairman, IndianOil inaugurated Liquid Chromatography - Mass Spectromety (LC-MS) facility at IOC-DBT Centre for Bio-Energy Research at R&D Centre. This state-of-the-art facility, a first at IndianOil R&D Centre, will be used for the complete analysis of pretreated biomass degradation products.
Handing over of Keys of the Toilets at Schools under Swachh Bharat Abhiyan at MRPL.(L-R): Shri D. K. Sarraf, CMD, ONGC; Shri S. S. Khuntia, SS&FA, MoP&NG; Shri DharmendraPradhan, Hon'ble Union Minister for Petroleum & Natural Gas.
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EVENTS
Working around poor or moderate data quality can be devastating to productivity and operationalexpenses in oil & gas exploration and production which is a knowledge-intensive, high-risk andhigh-reward business where the resource owner or operators have to depend on several others fortheir success. Stating this in his opening remarks Dr. Avinash Chandra, former Director General,Directorate General of Hydrocarbons brought out the importance of data and information standardsin E&P while chairing a guest lecture by Mr. Jay Hollingsworth, Chief Technology Officer at Energistics,Houston, USA organised by PetroFed at New Delhi on April 10, 2015.
Mr. Hollingsworth spoke on 'Leveraging Upsteam Business Efficiencies Through Energistics E&PStandards Collaborative Development & Implementation Process' in PetroFed's series of Guest
Lectures and Thought Leadership Programmes during his short visit to India. He has over twentyyears of upstream O&G industry experience and is a recognized global authority on the design anddeployment of upstream master data management solutions for petrotechnical and upstreamGIS data.
Standards, Mr. Hollingsworth said, provide requirements, specifications, and guidelines that areused to ensure that processes, products and services are fit for purpose. Energistics, he elaborated,is a global, not-for-profit, membership consortium that serves as the facilitator, custodian andadvocate for the development and adoption of technical open data exchange standards in theupstream oil and gas industry. Its membership consists of integrated, independent and national oilcompanies, oilfield service companies, software vendors, system integrators, regulatory agencies
and the global standards user community.The lecture ended with an intense Q&A session.
Dr. Avinash Chandra, former Director General, Directorate
General of Hydrocarbons (L) being welcomed by Mr. A. K. Arora,Director General, PetroFed with a bouquet of flowers.
Mr. Jay Hollingsworth, Chief Technology Officer at Energistics,
Houston, USA (L) being greeted by Session Chairperson,Dr. Avinash Chandra.
E&P Standards
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Lecture in progress.Mr. Jay Hollingsworth making his presentation.
Mr. Jay Hollingsworth replying to a query. A query being raised by Mr. A. K. Tyagi, General Manager,IndianOil.
Session Chairperson, Dr. Avinash Chandra delivering concluding remarks.
Session Chairperson, Dr. Avinash Chandra delivering opening remarks.
Mr. S. L. Das, Director (BD&C) welcoming participants.
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The importance of health, safety and environmental (HSE) issues in the hydrocarbon industry has
grown manifold with increasing regulatory oversight and public scrutiny. Companies need toimplement effective measures and management systems in these areas to protect their workers,the general public and the environment.
In this backdrop, to discuss and share the experience of industry professionals with the academia,the Petroleum Federation of India organized a workshop on ‘Safety Health and Environmental
Management in Hydrocarbon Industry’ in association with Indian Oil Corporation Ltd.(Haldia Refinery), the Oil Industry Safety Directorate (OISD) & Lovraj Kumar Memorial Trust (LKMT)from April 17-19, 2015 at the IndianOil Management Academy, Haldia, West Bengal.
The programme was conducted by experts from the industry and OISD and was intended for theteaching faculty of the Engineering Colleges and Universities. Twenty three participants from nineeducational Institutes participated in the programme which included a site visit to the refinery.
Inaugurating the workshop Shri S.N.Jha, former Director (P/L), IOCL & former President, IOTL sharedhis vast knowledge & experience in the field of Safety & Environment and gave several exampleslinking theoretical knowledge with his applied practical experience.
Earlier, Shri A.C. Mishra, ED (IC), Haldia Refinery while welcoming participants emphasized on theimportance of HSE and occupational health of employees in a refinery. He further emphasized onprocess safety and thanked PetroFed for organizing such programmes for enhancing knowledgeof teaching faculty.
Addressing the august gathering during the inaugural session, Shri A. K. Arora Director General,Petroleum Federation of India began by saluting the 'gurus' and went on to add that such Industry- Academia programmes provided an excellent platform for exchange of knowledge,sharing ofexperience and exposure to technology at work. Such programmes benefit both, the academicinstitutions and the industry, he added.
Shri Hirak Dutta, ED,OISD in his address focused on the reliability and integrity of plant & machineryto deliver sustained operations with sharper focus on safety & environment.
Shri H.P. Sahi, ED (Eastern Region), IOCL Pipelines in his address covered the key aspects ofsafety in pipelines operation and maintenance.
Shri A.P. Gangopadhyay, ED (Haldia Refinery) proposed a vote of thanks at the Inaugural Session.
Shri S L Das, Director (BD&C), PetroFed highlighted the utility of such workshops and hoped thatthey would help prepare students better before they step into the world of industry. He profusely
thanked Haldia Refinery for facilitating and hosting this programme.
Industry Academia Interface at Haldia on Health,Safety and Environment
Sh. G.J. Tyagarag, GM(HR), Haldia Refinery welcoming the participants.
Group photograph.
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Session in progress. Sh. A. K. Arora, Director General, PetroFed addressing the participants.
Industry Academia Interface on ‘A-Z of Natural Gas & LNG’
The share of gas in India’s energy mix is expected to go up steadily with the development of gasmarket, new LNG Terminals and a Gas Pipeline grid in the country. These developments envisagesubstantial requirement and deployment of skilled manpower in the gas sector. Considering thecurrent shortage of skilled manpower in the sector, there is an urgent need for revisiting and expandingthe course curriculum by the Technical Institutes including augmenting the knowledge and skills ofthe teaching faculty for building the required workforce.
In this backdrop, the Petroleum Federation of India organized the 4th Industry-Academia workshopon ‘A-Z of Natural Gas & LNG’ in association with the Lovraj Kumar Memorial Trust (LKMT) andPetronet LNG Limited (PLL) from April 30 to May 2, 2015 at Dahej, Gujarat.
The programme was conducted by experts from the industry and designed for the teaching faculty
of Engineering Colleges, Universities and Industry members. Thirty-seven participants from seveneducational Institutes, including 21 from the oil & gas industry attended the programme, whichincluded a field visit to the LNG Terminal of Petronet LNG who hosted the event.
The last few years have seen a lot of changes in the Natural Gas & LNG Industry with many newterminals coming up globally and in India said Mr. Rajender Singh, Director (Technical), PLL whileinaugurating the workshop. The supply side, he added, was impacted due to the decline in domesticproduction and costly imports resulting in idling of about 25000 MW power generation capacity inthe country. Notwithstanding these setbacks, the country needs additional terminal capacity tomeet the future demand. With expansion of Dahej Terminal to 15.00 MMTPA at the end of the IIIrdPhase of expansion (2016) and further addition of 2.5 MMTPA capacity during the IVth Phase (2018),the Dahej Terminal with a total capacity of 17.5 MMTPA will become one of the largest LNG Terminals
globally, he added.
Welcoming participants, Mr. A. K. Chopra, VP (HR & PR), PLL gave a brief background about PLL’sphased development, future expansion programme and the challenges faced on account of non-availability of skilled manpower to suit its needs. It is to meet these challenges and bridge the skillgap that these workshops are organized to provide a hands-on exposure to the teaching faculty onNatural Gas & LNG.
Mr. Suresh Mathur, founding CEO & MD, Petronet LNG Ltd while speaking on 'Challenges of LNG &Economics of its Use' touched upon the impact of gas on replacement of liquid fuels and theresultant saving of foreign exchange for the country. The pipeline grid and last mile connectivity forthe end user however is a must, duly supported by market determined pricing of gas in the country,
he added. Mr. Mathur also chaired the Valedictory session.Mr. S.S. Ramgarhia, Director (Policy & Planning), PetroFed while proposing a vote of thankselaborated on the background of Industry-Academia Interface programmes organized by PetroFed.
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Group photograph. Mr. Pankaj Wadhwa, Vice-President (F), PLL taking a session.
A section of the participants.
Mr. A K Chopra, VP (HR & PR), PLL welcoming the participants.Seated (L-R) Mr. S. Boutalik, VP(Projects) PLL; Mr. Sham Sunder.Former Director (Tech), PLL; Mr. Rajender Singh, Director (Tech),PLL; Mr. S.S. Ramgarhia, Director (P&P), PetroFed.
Mr. Rajender Singh, Dir (Tech), PLL delivering inaugural address.Seated (L-R) Mr. A. K. Chopra; Mr. S.S. Ramgarhia.
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Business Sustainability in Oil & Gas
An integrated approach towards energy pricing and usage and technological advancements wouldbe key factors for sustainable business growth in oil & gas in the near future, said Dr. Kirit Parikh,Chairman, Integrated Research and Action for Development (IRADe) and former Member, PlanningCommission in his opening remarks at a Top Management Conclave on 'Business Sustainability inOil & Gas: 2015 and Beyond' at New Delhi on May 4, 2015. The conclave was organised jointly bythe Petroleum Federation of India and DuPont.
In his keynote address, Mr. Matthew Trerotola, Executive Vice President, DuPont addressed the
issue of 'Managing Sustainable Growth in the wake of Changing Dynamics of the Oil & Gas Sector'.He opined that oil prices may hover in the US$ 65-70 per barrel range for an year or two by the endof 2015.
During the panel discussion, six key industry experts addressed the issues of 'Minimizing OperationalRisk & Enhancing Operational Excellence in India's Oil & Gas Sector'. The discussion was moderatedby Mr. Srinivasan Ramabhadran, Managing Partner - Asia Pacific & Global Director-OperationalRisk, DuPont Sustainable Solutions.
The downstream refining perspective was presented by Mr. Sanjiv Singh, Director (Refineries),IndianOil while the pipelines issues were addressed by Mr. P. K. Chakraborti, President-North Region,IOT Infrastructure & Energy Services Limited. The upstream E&P issues were addressed by
Mr. P. K. Sharma, GGM (OSD), OIL while those of the services sector in E&P were tackled byMr. Jayant Malhotra, Vice President and Global Accounts Director, Schulmberger. The issues ofHealth, Safety & Environment and Project Safety Management were comprehensively covered byMr. Ian Thorpe, Vice President (Health & Safety), HMEL and Mr. Hirak Dutta, Executive Director,Oil Industry Safety Directorate.
The deliberations witnessed healthy floor participation.
A vote of thanks was proposed by Mr. Balvinder Singh Kalsi, President, South Asia and ASEAN,DuPont.
Dr. Kirit Parikh, Chairman, IRADe and former Member, PlanningCommission being welcomed by Mr. Balvinder Singh Kalsi,President, South Asia and ASEAN, DuPont.
Mr. Matthew Trerotola, Executive Vice President, DuPont being greeted by Mr. A. K. Arora, Director General, PetroFed with a bouquet of flowers.
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Dr. Kirit Parikh delivering opening remarks. Participants in rapt attention.
Mr. Matthew Trerotola delivering keynote address. Session in progress.
Dr. Kirit Parikh commenting on the key issues for paneldiscussion.
Mr. Srinivasan Ramabhadran, Managing Partner - Asia Pacific &Global Director - Operational Risk, DuPont Sustainable Solutions introducing the subject.
Mr. Sanjiv Singh, Director (Refineries), IndianOil making his presentation.
A section of the participants.
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Panel discussion in progress. Seated (L-R): Mr. Hirak Dutta,Executive Director, OISD; Mr. Jayant Malhotra, VP and Global Accounts Di rector, Schlumberger ; Mr. Sanj iv Singh,Dr. Kirit Parikh, Mr. Srinivasan Ramabhadran, Mr. P. K. Sharma,GGM (OSD), Oil India Limited; Mr. P. K. Chakraborti, President-North Region, IOT Infrastructure & Energy Services Limited;Mr. Ian Thorpe, Vice President (Health & Safety), HMEL.
Mr. M.S. Ramachandran, former Chairman, IndianOil making his viewpoint.
Dr. Kirit Parikh concluding the session with his observations. Session Chairman, Dr. Kirit Parikh presenting a memento toMr. Matthew Trerotola.
Mr. A. K. Arora presenting a memento to Session Chairman,Dr. Kirit Parikh.
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A brilliant analysis of the historical perspective and events leading to the Companies Act 2013 waspresented by Mr. B.D. Gupta, former President, J M Morgan Stanley Ltd. and Director (Finance),
IndianOil during his Inaugural Address at a Workshop on the subject at New Delhi on May 15, 2015.It was organised by PetroFed in knowledge partnership with member company KPMG on 'Companies Act 2013, Ind AS & ICDS : Catching up with the Developments'. The subject was comprehensivelycovered in three technical sessions.
The Theme Address was delivered by Mr. Ashish Aul, Partner, KPMG who highlighted the significanceof the developments and set the tone and tenor for the day-long proceedings.
Mr. Kaushal Kishore, Partner in the Audit division in BSR & Cos. led the first technical session onthe recent updates and financial reporting under Companies Act 2013. He was assisted in the laterhalf by Mr. Ashish Bansal, Director, BSR & Co.
Mr. Pravin Tulsyan, Partner, BSR & Co. addressed issues pertaining to Ind AS in the second technical
session.
The third technical session was addressed by Mr. Mradul Sharma, Director, KPMG who covered theissues of Income Computation and Disclosure Standards.
The workshop helped in clarifying several doubts engaging the attention of industry members andresulted in intense interactions with the experts.
Companies Act 2013
Mr. B.D. Gupta, former President, JM Morgan Stanley Ltd. &Director (Finance), IndianOil (right) being greeted by Mr. A. K. Arora, Director General, PetroFed (center) with a bouquet of
flowers. Also seen in the picture is Mr. Ashish Aul, Partner, KPMG.
Mr. Ashish Aul, Partner, KPMG being welcomed by Mr. A. K. Arorawith a bouquet of flowers.
Mr. Ashish Aul delivering theme address. Mr. B.D. Gupta delivering inaugural address.
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Mr. Kaushal Kishore, Chartered Accountant making his presentation during Technical Session-1.
Participants keenly watching presentation.
Mr. Ashish Bansal, Chartered Accountant sharing his perspective. Mr. Pravin Tulsyan, Chartered Accountant making his presentationduring Technical Session-2 on 'Ind AS'.
Mr. Mradul Sharma, Director, KPMG making his presentationduring Technical Session-3 on ‘Income Computation and Disclosure Standards’.
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The risks in the global economy have intensified, to a large extent due the un-coordinatednormalization of monetary policies in major G-20 countries. These can have adverse impacts on
financial markets of emerging economies like India, through outflow of foreign exchange and upwardpressure on domestic interest rates.
These were some of the issues highlighted by Dr. N.R. Bhanumurthy, Professor, National Institute ofPublic Finance and Policy (NIPFP) while addressing an invited audience at New Delhi on May 26,2015. He was speaking in PetroFed's continuing series of Guest Lecures and Thought LeadershipProgrammes on issues of 'Global Developments and the Indian Economy'.
The emerging markets, Dr. Bhanumurthy said are already staring at a low economic growth andhigh stress in the banking sector and need to have policies that can withstand anticipated risksthrough building foreign exchange reserves and prudent domestic macroeconomic and financialpolicies.
Dr. Bhanumurthy holds a PHD in International Finance and his research areas are developmenteconomics, macro-monetary economics, international money and finance and macro economicmodelling.
The lecture was well received by the select audience and generated intense floor participation.
Global Developments and the Indian Economy
Dr. N. R. Bhanumurthy, Professor, National Institute of PublicFinance and Policy (L) being greeted by Mr. S.L. Das, Director (BD&C), PetroFed (R ) with a bouquet of flowers.
Dr. N.R. Bhanumurthy delivering his lecture.
Mr. Nirmal Singh, former Secretary, Govt. of India sharing hisview point. Others (L-R): Mr. V. S. Jain, former Chairman,SAIL and Mr. B. D. Gupta, former President, JM Morgan Stanley Ltd. & Director (Finance), IndianOil.
Lecture in progress.
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Some of the industry concerns pertaining to the Companies Act 2013 as well as Ind AS and IncomeComputation and Disclosure Standards (ICDSs) were brought out by Shri Atanu Guha, CFO,Tata Petrodyne Ltd. while inaugurating a workshop on the subject at Mumbai on May 29, 2015.
Organised by PetroFed in knowledge partnership with KPMG, the workshop on subject 'Companies Act 2013, Ind AS & ICDS : Catching up with Developments' was intended to take stock of thesignificant developments till date and discuss the implementation issues that arose therefrom.
The Theme Address at the workshop was delivered by Shri Sai Venkateshwaran, Head, Accounting Advisory Services, KPMG India. He dwelt on the key issues which are currently of concern.
In the first technical session, Shri Kaushal Kishore, Partner in the Audit division of BSR & Co. dealt
with the recent updates of the Companies Act 2013. He was assisted in the later half by Shri AshishBansal, Director, BSR & Co.
In the second technical session, the subject of Ind AS was comprehensively covered by KPMG,Partner, Shri Koosai Lehery.
The last technical session on Computation and Disclosure Standards (ICDSs) was tackled byShri Dinesh Jangid, Director, KPMG.
There was intense floor participation throughout the workshop since there were several concernson implementation which were agitating the industry members. The KPMG experts tackled all queriescompetently.
Catching up with Developments under Companies Act
A section of the participants.Shri Sai Venkateshwaran delivering Theme Address.
Shri Atanu Guha, CFO, Tata Petrodyne being welcomed by Shri S.S. Ramgarhia with a bouquet of flowers.
Shri Sai Venkateshwaran, Head, Accounting Advisory Services,KPMG India (L) being greeted by Shri S.S. Ramgarhia, Director (Policy & Planning), PetroFed with a bouquet of flowers.
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Shri Kaushal Kishore, Partner in the Audit Division of BSR &Co. making his presentation during Technical Session - I.
Shri Atanu Guha delivering Inaugural Address.
Shri Ashish Bansa, Director, BSR & Co. addressing participants.Q&A session in progress.
Shri Koosai Lehery, Partner, KPMG making his presentation duringTechnical Session-II.
Session in progress.
Shri Dinesh Jangid, Director, KPMG making his presentationduring Technical Session III.
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The 2015 theme for the World Environment Day celebrated every year on June 05 is sustainableconsumption and production. It focuses on how the wellbeing of humanity, environment and
economies ultimately depends on the responsible management of the planet's natural resources.The slogan for the theme is 'Seven Billion Dreams. One Planet. Consume with Care'.
In consonance with the theme of World Environment Day PetroFed organized a lecture on 'WaterResources Management for Sustainable Development' by Prof. Janardhana Raju, Professor ofEnvironmental Geosciences at the School of Environmental Sciences, Jawaharlal Nehru Universityon June 5, 2015 at New Delhi.
Prof. Raju, who is an expert on Groundwater Hydrology and Environmental Geosciences focussedon harvesting, conservation and application of surface water. The importance of these issues wasbrought out by him by pointing out the fundamental right to freshwater is not exercised by about3.5 billion women and men across the world according to the UN World Water Development Report
2014. There is enough water on earth - we need to manage it better.The great interest was evinced by participants in the subject particularly on the issue of waterharvesting.
Water Resources Management
Prof. Janardhana Raju, Prof. of Environmental Geosciences at the School of Environmental Sciences, Jawaharlal NehruUniversity being welcomed by Shri A.K. Arora, DG, PetroFed with a bouquet of flowers.
Participants keenly watching the presentation. A section of the participants.
Prof. Janardhana Raju delivering his lecture.
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Options for Revenue Neutral GST for Oil & Gas
As a result of PetroFed representations before the Standing Committee of Parliament as well as the
Empowered Committee of State Finance Ministers, the current Constitution Amendment Bill does
not exclude crude oil & select petroleum products. Stating this, Shri R.S. Butola, former Chairman,
IndianOil stressed that we should take the matter forward and ensure inclusion of all petroleum products
in the scheme of GST while chairing a session on the subject at New Delhi on June 12, 2015.
Organised under PetroFed's series of Guest Lectures and Thought Leadership Programmes, the
lecture was on 'Options for Revenue Neutral GST for Oil & Gas' by Prof. Sacchidananda Mukherjee,
Associate Professor, National Institute of Public Finance and Policy (NIPFP). In a detailed presentation
Prof. Mukherjee brought out the fact that there were alternatives for inclusion of Oil & Gas in the
scheme of GST from the beginning since their elimination would lead to cascading of taxes which
could be detrimental for competitiveness of Indian industries in international market.
Non availability or partial availability of input tax credit will result in stranded costs for some sectors
and the costs may be spread across all sectors of the economy through sectoral inter-linkages.
Prof. Mukherjee concluded by highlighting that there is little ground for separating out petroleum
products for special treatment by keeping them out of the base of GST.
The subject being of great importance to the sector witnessed intense floor participation.
Shri R.S. Butola, former Chairman, IndianOil (R) being greeted by Shri A.K. Arora Director General, PetroFed (L ) with a bouquet of flowers.
Prof. Sacchidananda Mukherjee, Associate Professor, NationalInstitute of Public Finance and Policy (NIPFP) (R) beingwelcomed by Shri A.K. Arora (center) with a bouquet of flowers.
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Prof. Mukherjee responding to a question. A section of the participants.
Shri R.S. Butola delivering his opening remarks. Prof. Sacchidananda Mukherjee making his presentation.
Shri R.S. Butola presenting a memento to Prof.Sacchidananda Mukherjee.
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The Governing Council of the Petroleum Federation of India at its 38 th meeting on June 15, 2015welcomed Chandigarh University as a member of the Federation.
It deliberated on the reorganization and succession plan of PetroFed and conveyed its appreciationfor the diverse set of activities that had been taken up since the previous meeting. In this regardparticular note was taken of the study report sent to the Government on ‘Stimulating DomesticExploration and Production in India - Policy Recommendations’.
It was noted that PetroFed employees had contributed their one-day salary to the Prime Minister'sNational Relief Fund for assisting earthquake victims in April, 2015. A similar contribution had beenmade in July 2014 for assistance to the victims of floods in Jammu & Kashmir.
38 th Governing Council Meeting
Chairman, Shri B. Ashok addressing the Governing Council. Shri P. Raghavendran, Vice Chairman, PetroFed participated inthe meeting through video conferencing.
The Governing Council members at New Delhi interacting withShri P. Raghavendran through video conferencing.
Meeting in progress (L-R) Shri U. Venkata Ramana, Director (Technical), CPCL; Shri T.K. Sengupta, Director (Offshore),ONGC; Shri A.K. Arora, Director General, PetroFed; Shri B. Ashok,Chairman, PetroFed and Chairman, IndianOil; Shri M.A. Pathan,
Management Consultant & former Chairman, IndianOil and former Resident Director, Tata Group; Shri R.S. Butola, Honorary Member and former Chairman, IOCL and Shri S.P. Gathoo,Director (HR), BPCL.
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