Decarbonizing the Downstream Industry

Introduction and Context

???????The increasing necessity to reduce the environmental impact produced by fossil fuels have been created a trend of decarbonization of the energetic matrix at a global level, creating then a new challenge to the crude oil production and processing chain. The current geopolitical crisis due to the war between Ukraine and Russia put another element in this scenario, the necessity to reduce the carbon intensity at same time to keep and ensure the energy security for the nations.

???????????Under this scenario, one of the available alternatives is raising the renewable fuels participation in the energetic matrix as well as the higher use of renewable raw materials in the feed stream of crude oil refineries and this fact has been led some refining technology licensors to dedicate efforts to develop processes for this purpose. ?

???????????The adoption of synergies between fossil fuels and renewables in the downstream industry depends on the market where the refiner is inserted, mainly related to the availability of renewable raw materials as well as the capacity of the installed refining hardware to processing the renewable streams.

???????????Despite these limitations, it’s important to understand that the renewables are already a reality in the market, contributing to the reduction of the demand for fossil raw material, according to data from International Energy Agency (IEA), the COVID 19 pandemic causes the first contraction in biofuels market in two decades, as presented in Figure 1.

Figure 1 – Biofuels Production in 2019 and the Contraction in 2020 (IEA, 2020)

???????????Despite this contraction in 2020, the stricter regulations and policy pressure tends to drive a fast recovery and expansion in the biofuels demand still according to data from IEA presented in Figure 2.

Figure 2 – Global Biofuels Production Forecast (IEA, 2020)

???????????Considering these trends, it’s possible to estimate the impact of biofuels in the crude oil reefing industry and the coprocessing of renewable raw material in the traditional crude oil refineries can be an attractive decarbonization strategy. After the COVID 19 pandemic, some refiners decided to convert some refining assets to process renewable raw material, reinforcing this trend in the new scenario of downstream industry.

Biofuels Production in Brazil

???????????Brazil has a long tradition in biofuels production, in 1975 due to the petroleum crisis the Brazilian authorities launched an alternative fuel program called PROALCOOL, where the main intention was to support the development of the ethanol from sugar cane as automobile fuel in substitution of gasoline to reduce the external dependence of the Brazilian energetic matrix.

???????????According to the Brazilian Petroleum Agency (ANP), in 2019 the Brazilian ethanol production reached 35,3 million m3 considering the volumes of anhydrous and hydrated ethanol. This production reveals consistent growing in the production over the years, Figure 3 shows the ethanol production profile over the last years in the Brazilian market.

Figure 3 – Evolution of Brazilian Ethanol Production (ANP, 2020)

???????????Based on data from Figure 3, the Brazilian ethanol production growth in an average annual rate of 2,30%, considering only the anhydrous ethanol the annual growth is even more expressive, reaching 2,60 % in 2010-2019 period. By the law, the gasoline commercialized in Brazil have 27 % in volume of anhydrous ethanol which is applied to improve the gasoline quality (octane boosting) and to ensure participation of renewable fuels in the Brazilian energetic matrix. The hydrated ethanol is commercialized in gas stations as pure fuel to automobiles, still according to data from ANP, in 2019 the Brazilian production of hydrated ethanol reached 24,9 million m3 with an average annual growth of 2,10% considering the 2010-2019 period.

???????????Brazil is a great transportation fuel consumer, and the main driver of the Brazilian economy is the Diesel due to the country dimensions and the transport infrastructure which relies on road transport, the total production of diesel in the Brazilian market reached close to 41 million m3 in 2019. By law force, the diesel commercialized in the Brazilian territory needs to contain 12 % in volume of biodiesel and the intention of the Brazilian government is to raise this percentual to 15 % in 2023. Figure 4 presents the evolution of the Brazilian biodiesel production between 2010 and 2019 in million m3.

Figure 4 – Evolution of Brazilian Biodiesel Production (ANP, 2020)

???????????The main raw material applied to produce biodiesel in Brazil is soybean oil with close to 68 % of the total production followed by the animal fat with 11 %.

???????????As described above, the biofuels are fundamental to sustain the energetic matrix and economic development of Brazil. The blending of anhydrous ethanol to the gasoline and biodiesel to diesel represents a kind of strategy to produce cleaner fuels, but this not the only strategy which are being applied to the refiners aiming to reduce the environmental footprint of the transportation fuels.

????????????An important trend of the energy transition in the downstream industry is the coprocessing of renewables raw material in the crude oil refineries. This strategy involves feeding the renewable raw material directly to the refining process, which represent a more challenging decarbonization strategy.

Challenges of Renewables Coprocessing in Crude Oil Refineries

???????????The use of renewable raw material in the crude oil refineries has been discussed in the last decades. The adoption of synergies between fossil fuels and renewables in the downstream industry depends on the market where the refiner is inserted, mainly related to the availability of renewable raw materials as well as the capacity of the installed refining hardware to processing the renewable streams.

???????????One of the most common processing routes is the utilization of vegetable or animal oils in the feedstock of conversion or treating units to produce high quality fuels and petrochemicals. The renewable raw material can be directly processed together fossil streams in conversion units like fluid catalytic cracking (FCC) to produce transportation fuels and olefins.

???????????The use of renewable streams also can be applied as a feed stream of hydrotreating units, aiming to produce high quality fuels like Diesel and Jet Fuel.

Some refiners and technology licensors have been developed process technologies that make possible the higher synergy of renewables with the conventional refining industry.

In the petrochemical sector, the production of petrochemical intermediates also has been adopted renewables processing routes as ethanol to produce ethylene. Some Companies has been applied the ethylene production through ethanol dehydration since 2010 and some technology licensors have been developed processing routes also dedicated to producing ethylene from ethanol.

???????????Despite the advantages of environmental footprint reduction of the refining industry operations, renewables processing presents some technological challenges to refiners. Figure 5 presents the chemical mechanism for the processing of vegetable/animal oils in hydrotreating units.?

Figure 5 – Chemical Mechanism of the Renewable Feed stream Hydrotreating (Article by ExxonMobil Company, 2011)

The renewable streams have a great number of unsaturations and oxygen in his molecules which lead to high heat release rates and high hydrogen consumption, this fact leads to the necessity of higher capacity of heat removal from hydrotreating reactors aiming to avoid damage to the catalysts. The main chemical reactions associated with the renewable streams hydrotreating process can be represented as below:

R-CH=CH2 + H2 → R-CH2-CH3 (Olefins Saturation)

R-OH + H2 → R-H + H2O (Hydrodeoxigenation)

Where R represents a hydrocarbon.

These characteristics lead to the necessity of higher hydrogen production capacity by the refiners as well as quenching systems of hydrotreating reactors more robust or, in some cases, the reduction of processing capacity to absorb the renewable streams. In this point it’s important to consider a viability analysis related to the use of renewables in the crude oil refineries once the higher necessity of hydrogen generation implies in higher CO2 emissions through the natural gas reforming process that is the most applied process to produce hydrogen in commercial scale. ?

CH4 + H2O = CO + 3H2????(Steam Reforming Reaction - Endothermic)

CO + H2O = CO2 + H2??????(Shift Reaction - Exothermic)

???????????Despite the concern related to the CO2 emissions due to hydrogen production there are some cleaner hydrogen production routes that present attractive alternatives to the downstream players like the steam reforming of biomethane, reverse water gas shift (RWGS), and the electrolysis process.

These characteristics lead to the necessity of higher hydrogen production capacity by the refiners as well as quenching systems of hydrotreating reactors more robust or, in some cases, the reduction of processing capacity to absorb the renewable streams.

This fact leads some technology licensors to dedicate his efforts to look for alternative routes for hydrogen production in large scale in a more sustainable manner. Some alternatives pointed can offer promising advantages:

·??????Natural Gas Steam Reforming with Carbon Capture – The carbon capture technology and cost can be limiting factor among refiners;

·??????Natural Gas Steam Reforming applying biogas – The main difficult in this alternative is a reliable source of biogas as well as their cost.;

·??????Reverse water gas shift reaction (CO2 = H2 + CO) – One of the most attractive technologies, mainly to produce renewable syngas;

·??????Electrolysis – The technology is one of the more promising to the near future.

As aforementioned, hydrogen is a key enabler to the future of the downstream industry and the development of renewable sources of hydrogen is fundamental to the success of the efforts to the energy transition to a lower carbon profile. In the current scenario, the best alternative to refiners is optimize the hydrogen consumption minimizing the operating costs and CO2 emissions.

Another challenge associated with renewables processing is the cold start characteristics of the derivatives, mainly Diesel and Jet Fuel. The renewable feed streams produce highly paraffinic derivatives after hydrotreating step, in this sense, the final derivative tends to show a higher cloud point which can be a severe restriction in colder markets as the northern hemisphere. ?

???????????In these markets, refiners tend to apply catalytic beds containing dewaxing catalysts (ZSM-5) in his hydrotreating units or cloud point depressors additives which can raise the operation costs.

Recently, the literature is classifying the hydrogen production routes in four classes as follow (Based on IEA data from 2019):

1 – Brown Route – Hydrogen production from coal gasification without carbon abatement system (CCS). This route presents the higher emission rate of greenhouse gases (19 t CO2/t H2) and an average production cost of US$ 1,2 to 2,1 per kg H2;

2 – Gray Route – This is the conventional hydrogen production route adopted by the most part of the refiners, which applies steam reforming of natural gas without CCS. This route still presents high emission of greenhouse gases (11 t CO2/t H2) and an average production cost of US$ 1,0 to 2,1 per kg H2;

3 – Blue Route – This route encompasses the conventional steam reforming of natural gas with CO2 abatement system. In this case, the CO2 emissions are drastically reduced (0,2 t CO2/ t H2), but the average production cost reaches US$ 1,5 to 2,9 per kg H2;

4 – Green Route – As presented above, the green route is based on electrolysis through renewable electricity. In this case it’s possible to reach zero CO2 emissions, but the average production cost is still considered high (US$ 3,0 to 7,5 per kg H2).

The technology development and scale-up gains tends to reduce the production costs of cleaner routes over the next years. Currently, the best alternative to refiners is to optimize the hydrogen consumption to keep under control the operating costs as well as, control the emissions of greenhouse gases.

Nowadays, as presented in Figure 6, the crude oil refining industry is the main hydrogen consumer followed by the ammonia production.

Figure 6 – Main Production Routes and Hydrogen Consumers (ETC Global Hydrogen Report, 2021)

Still based on data from Figure 6, 71 % of the hydrogen produced by dedicated processes is from natural gas steam reforming and 27 % from coal gasification, both routes present high emissions of greenhouse gases (mainly CO2). According to the reference, the difference (close to 75 Mt of hydrogen) is related to the generation where the hydrogen is produced as a by-product like naphtha catalytic reforming or propane steam cracking as example. Crossing the data from Figure 6, it’s clear the relevance of the necessity of the energy transition efforts in the downstream sector to the success of the global transition to a low carbon and hydrogen economy.

The Hydrotreated Vegetable Oil (HVO) – An Attractive Route to Reach “Green Diesel”

???????????As presented above, the necessity to build a continuous supply of more sustainable transportation fuels are leading the refiners to consider processing renewables raw materials in the refining hardware to achieve cleaner and less carbon fuels. One of the most promising initiatives in this sense in the production of Hydrotreated Vegetable Oil (HVO) to compose the Diesel pool of some refineries, the process consists of in processing renewable material like palm oil in conventional diesel hydrotreating units to produce the called “green diesel”. At this point it’s interesting to make a differentiation between the Biodiesel and HVO, the biodiesel is produced through the transesterification, producing a mixture of fatty acids and methyl esters, the HVO basically composed by normal paraffin which is result of hydrotreating reactions. The great advantage of the HVO in comparison with the biodiesel is the similarity of properties in relation with the fossil diesel, the density of the HVO tends to be lower than the fossil diesel and cetane number tends to be high, being a perfect additive in a final mixture, in the other side the high concentration of normal paraffin lead to a worse cold flow characteristics, which can be bypassed through the use of dewaxing beds in hydrotreating reactors applying ZSM-5 catalysts to control the dimension of paraffin chain, due to these characteristics the HVO can be a better blending agent to the final diesel than the traditional biodiesel produced by transesterification as presented in Figure 7.

Figure 7 – Renewable Diesel Composition based on Production Route (LINDFORS, 2010)

???????????One of the most relevant challenges of the HVO production is the cost of raw material as well as the choice of this raw material. Another great challenges to the HVO production in the traditional crude oil refineries is the catalyst applied in the process, normally the hydrotreating catalysts are composed by metal sulfide like NiMo or CoMo carried over Alumina, but the low sulfur concentration and the water production during the hydrotreating reaction of renewable raw materials tends to deactivate these catalysts. An alternative in this case is to feed H2S with the feed stream, but there is always the risk to contaminates the final derivative with high sulfur content, the use of noblest metal like Ru and Pt as active metal can solve this problem, but the operating cos can be prohibitive.

???????????Another challenge related to the HVO production is the higher heat release in the hydrotreating reactors which requires a well dimensioned quenching systems, it’s important to remember that the conventional hydroprocessing reactors are designed to deal with low contaminants concentration while the renewables raw materials present high quantity of unsaturated molecules and oxygen, leading to a high heat release rate.

???????????Another issue related with the coprocessing of renewables raw material in crude oil refineries is the tendency of water retention in the final derivatives. Due to the chemical structure, the biodiesel for example, tends to retain more than 8 times more moisture than fossil diesel which can lead to issues like microbiological degradation of the fuel in the transport and storage systems. The soluble water content in pure biodiesel can reach close to 1.800 ppm while the value to the diesel with 20 % of biodiesel can reach close to 280 ppm of soluble water, and the diesel with 5 % of biodiesel can present until 150 ppm, this fact will lead the refiners to adequate their hardware to allow the water removal from the final derivatives applying draining systems or the application of salt filters to control the moisture content in the final derivatives.

From the point of view of crude oil producers, the renewables coprocessing can be faced as a demand destruction. This threat can be overcome through enjoying the change in the profile of crude oil consumption where is observed a growing demand by petrochemicals intermediates like ethylene, propylene, and BTX while the transportation fuels like gasoline and diesel present falling demand. As presented above, the biomass processing in crude oil refineries presents significant challenges for the refiners. Figure 8 present an overview of the advantages and disadvantages of coprocessing renewable feeds in a typical FCC unit.

Figure 8 – Challenges and Advantages of Coprocessing Renewable Feeds in FCC Units (AVERY & STROHM, 2021)

Jet Fuel – A Challenging Case of Decarbonization

A special and challenging case of decarbonization of fossil fuel is the jet fuel. Jet fuel is a mixture of hydrocarbons between C5 to C15 with a boiling range of 150 oC to 300 oC, is applied as fuel to Jet turbines, normally applied in aviation. ?Due to the severity of use conditions, the Jet fuel has quality requirements quite restricted, the combustion needs to be the cleaner possible to avoid depositions, by this reason the polyaromatics content is controlled, this is achieved through the smoke point test.

???????????The characteristics of flow under low temperature are fundamental to the Jet fuel, due to the operational conditions that can achieve temperatures of – 50 oC. The maximum freezing point to commercial jet fuel is – 47oC, by this reason, it’s fundamental to ensure an adequate cut point in the distillation step to avoid the drag of heavy paraffins to the intermediate kerosene. The thermal stability is measured through the JFTOT (Jet Fuel Thermal Oxidation Test) test which simulates the operational conditions that the fuel is submitted. ?

???????????The corrosivity and chemical stability in relation to the materials applied to the construction of turbines are controlled through the content of total sulfur, mercaptan sulfur, and H2S. Normally the jet fuel is submitted to caustic treating step to control of these compounds, in modern refining units this step is carried out in hydrotreating units. The flash point (minimum 40 oC) and the electric conductivity are other requirements directly related to the security in the derivative handling. ?Figure 8 presents the evolution of the jet fuel market in the last years and forecast between 2020 to 2050.

Figure 8 – Evolution of Jet Fuel Market (STATISTA, 2020)

According to data from Air Transport Action Group (ATAG), the aviation sector was responsible by emission of 915 million tons of CO2 in 2019, 12 % of the total emissions from the transport sector.

The growing demand and significant emissions of greenhouse gases are the main drivers for the requirement from the society to reduce the carbon intensity of the jet fuel. This fact led refiners and technology developers to dedicate efforts to develop Sustainable Aviation Fuels (SAF) to be blended with fossil jet fuel and minimize the carbon footprint of the aviation sector.

The main jet fuel production routes are the hydrotreated vegetable oil (HVO) or the hydrotreated esters and fatty acids (HEFA), as described above. In this case, one issue is that the yield of jet fuel is relatively low (about 15 %) once the conventional operating conditions favors diesel production.

Another promising production route is the thermochemical process applying biomass as feedstock, in this case it’s possible to apply biomass gasification and Fischer-Tropsch synthesis or thermal or catalytic pyrolysis to produce biojet fuel. Among the technologies dedicated to produce renewable jet fuel we can quote the catalytic hydrothermolysis and biochemical routes which applies fermentation processes. Considering the increasing necessity to minimize the carbon emissions, is expected a significant demand growth for SAF for the next years.

Figure 9 presents a forecast of the Sustainable Aviation Fuel (SAF) market size considering the period from 2022 to 2032.

Figure 9 – Global Sustainable Aviation Fuel Demand Forecast (Precedence Research, 2023)

According to data from Precedence Research, the SAF market reached a total value of USD 433 million in 2022 and will reach a total value of USD 14,8 billion in 2032 under a compound annual growth rate (CAGR) of 42,4 %.

As presented in Figure 9, the increasing pressure to reduce the carbon intensity of the energetic matrix tends to raise the participation of the biofuels in the market, reducing the consumption of fossil fuels, which can be considered a demand destruction. In this sense, the players of downstream industry needs to consider the revamp of their refining hardware aiming to allow an increasing rate of renewables coprocessing, especially related to the hydrogen generation capacity as well as alternative and high added value routes to add value to crude oil, like petrochemicals, lubricants, etc.

Decarbonizing the Petrochemical Sector – Commercial Technologies

???????????The petrochemical sector is also under pressure to reduce their carbon footprint like the refining industry. Despite the actions to minimize the carbon emissions through the optimization of energy intensity of the petrochemical processes and closer integration between refining assets, the players of petrochemical sector are also demanded to include the coprocessing of renewable raw materials to produce petrochemical intermediates.

???????????One of the most known processing routes in this sense is the ethylene production through catalytic dehydration of ethanol, as presented in Figure 10.

Figure 10 – Ethanol Dehydration Reaction to Produce Ethylene

DEE – Diethyl Ether (Hummingbird Technology from Technip Company)

???????????Nowadays, the Brazilian Company BRASKEM is already employing this route to produce a “green” ethylene. The company starts the operation of an ethylene plant based on this technology in 2010 with a production capacity of 200.000 tons per year of “green” ethylene from sugar cane ethanol. ?Another technology developers like Axens and Technip developed processing technologies capable to produce ethylene through ethanol dehydration, the Hummingbid? process licensed by Technip Company is presented in Figure 11.

Figure 11 – Process Flow Scheme for the Hummingbird? Ethanol to Ethylene Process by Technip Company (Technip Company, 2019)

???????????It’s interesting to quote that the ethanol dehydration process can be applied also to produce transportation fuels through a green route applying the oligomerization and hydrogenation steps achieving molecules in the diesel and jet fuel range as presented in Figure 12.

Figure 12 – Production of Green Fuels through Ethanol Dehydration (Technip Company, 2021)

???????????Figure 13 presents an overview of the ATOL? process developed by Axens Company to produce ethylene from ethanol.?

Figure 13 – ATOL? Process Technology by Axens to Produce Ethylene from Ethanol (Axens Company, 2023)

???????????Another attractive route of decarbonization in development to the petrochemical sector is the ethylene production through the coprocessing of ethanol in FCC units.

Conclusion

???????????The energy transition is not a question of choice to the players of downstream industry, it’s a demand from the society and a survival question in middle term. Decarbonization of the energetic matrix requires even more flexibility and agility by refiners aiming to keep and improve his refining margins in the scenario of reduction in the transportation fuels demand and growing demand by petrochemicals, however, as aforementioned there is available processing technologies capable to allow the co-processing of renewables and fossil feed streams in crude oil refineries, reducing the environmental impact of downstream industry.

???????????Nowadays, is still difficult to imagine the global energetic matrix free of fossil transportation fuels, especially for in developing economies and raise the participation of renewable raw material in crude oil refineries can be an attractive strategy, the Brazilian case reinforces that, even in nations with great demand by transportation fuels, the biofuels can develop a fundamental role in the energetic matrix.

Despite the recent forecasts indicates a falling demand by transportation fuels and growing demand by petrochemicals, the transportation fuels are still fundamental to sustain the economic development of nations, especially in developing economies. This fact reinforces, even more the necessity to reduce the carbon emissions in the crude oil processing chain and the biofuels can develop a fundamental role to the achievement of this goal in the downstream industry. Although the environmental benefits it’s important to consider that the growing market of biofuels can bring some side effects like the shortage of renewable feedstock and, in extreme cases, competition between the fuels and food production.

The growing participation of the biofuels in the energetic matrix also calls the players of the downstream industry to action in order to prepare their refining hardware to increasing rate of renewables coprocessing aiming to keep and enlarge their participation in transportation fuels market, at same time, this scenario can act as a driver for closer integration between refining and petrochemicals assets in order to ensure added value to the crude oil through petrochemicals taking into account the increasing demand destruction of fossil transportation fuels caused by biofuels.

Despite the advantages of biofuels and renewables coprocessing in crude oil refineries, it’s fundamental to understand that a real decarbonization is only possible through renewable hydrogen production sources as well as efficient carbon capture technologies.

References

AVERY, C.; STROHM, J. – FCC Pathways to Co-processing, PTQ Magazine, 2021.

Brazilian Petroleum Agency (ANP). Brazilian Statistical Yearbook, 2020.

Energy Research Company (EPE). Analysis of the Biofuels Conjuncture – Technical Report, 2020.

Energy Transitions Comission (ETC) – Making the Hydrogen Economy Possible: Accelerating Clean Hydrogen in an Electrified Economy, 2021

HILBERT, T.; KALYANARAMAN, M.; NOVAK, B.; GATT, J.; GOODING, B.; McCARTHY, S. - Maximising Premium Distillate by Catalytic Dewaxing, 2011.

IEA Bioenergy. Progress in Commercialization in Biojet/Sustainable Aviation Fuels (SAF): Technologies, Potential, and Challenges – Technical Report, 2021.

LINDFORS, L. P. High Quality Transportation Fuels from Renewable Feedstock, Neste Oil Company, 2010.

Reinventing the Refinery through the Energy Transition and Refining-Petrochemical Integration. IHS Markit, 2020.

ROBINSON, P.R.; HSU, C.S. Handbook of Petroleum Technology. 1st ed. Springer, 2017.

ZHU, F.; HOEHN, R.; THAKKAR, V.; YUH, E. Hydroprocessing for Clean Energy – Design, Operation, and Optimization. 1st ed. Wiley Press, 2017.

Dr. Marcio Wagner da Silva is Process Engineer and Stockpiling Manager on Crude Oil Refining Industry based in S?o José dos Campos, Brazil. Bachelor’s in chemical engineering from University of Maringa (UEM), Brazil and PhD. in Chemical Engineering from University of Campinas (UNICAMP), Brazil. Has extensive experience in research, design and construction to oil and gas industry including developing and coordinating projects to operational improvements and debottlenecking to bottom barrel units, moreover Dr. Marcio Wagner have MBA in Project Management from Federal University of Rio de Janeiro (UFRJ), in Digital Transformation at PUC/RS, and is certified in Business from Getulio Vargas Foundation (FGV).?