A Noblest and Profitable Purpose to Crude Oil – Crude to Chemicals Technologies

Introduction and Context

           The downstream industry faces a transition period where the focus of the players is changing from transportation fuels to petrochemicals aiming to ensure maximum added value to processed crude oils as well as to allow the growth of low carbon energies in the global energetic matrix.

           The newest threat to refiners is the reduction of the consumer market, in the last years became common, news about countries that intend to reduce or ban the production of vehicles powered by fossil fuels in the middle term, mainly in the European market. Despite the recent forecasts, the transportation fuels demand is still the main revenues driver to the downstream industry, as presented in Figure 1, based on data from Wood Mackenzie Company.

Figure 1 – Relation of Petrochemical Feedstock/Transportation Fuels Feedstock and Installed Capacity (Wood Mackenzie, 2019)

According to Figure 1, the transportation fuels demand represents close to five times the demand by petrochemicals as well as a focus on transportation fuels of the current refining hardware, considering the data from 2019. Despite these data, is observed a trend of stabilization in transportation fuels demand close to 2030 followed by a growing market of petrochemicals. Still according to Wood Mackenzie data, presented in Figure 2, is expected a relevant growth in the petrochemicals participation in the global oil demand.

Figure 2 – Change in the Profile of Global Crude Oil Demand (Wood Mackenzie, 2019)

The improvement in fuel efficiency, growing market of electric vehicles tends to decline the participation of transportation fuels in the global crude oil demand. New technologies like additive manufacturing (3D printing) has the potential to produce great impact to the transportation demands, leading to even more impact over the transportation fuels demand. Furthermore, the higher availability of lighter crude oils favors the oversupply of lighter derivatives that facilitate the production of petrochemicals against transportation fuels as well as the higher added value of petrochemicals in comparison with fuels. According to Figure 3, the demand by petrochemicals tends to rise in the next years and can be an attract way to refiners keep his protagonism in the market.

Figure 3 – Growing Trend in the Demand by Petrochemical Intermediates (Deloitte, 2019) - Note: Bars represent total demand (million metric tons or MMT), circles represent total capacity (MMT).

According to data presented in Figure 3, is expected a significant growth in the market of petrochemicals intermediates, and a refining hardware capable to maximize the yield of these derivatives can offer significant competitive advantage through closer integration with petrochemical assets and higher value addition to processed crude oil.

           Another deep change in the downstream sector that reinforces the necessity of a high conversion refining hardware is the IMO 2020. Restrictive regulations like IMO 2020 raised, even more, the pressure over refiners with low bottom barrel conversion capacity once requires higher capacity to add value to residual streams, especially related to sulfur content that was reduced from 3,5 % (in mass) to 0,5 %. Refiners with easy access to low sulfur crude oils present relative competitive advantage in this scenario, these players can rely on relatively low cost residue upgrading technologies to produce the new marine fuel oil (Bunker) as carbon rejection technologies (Solvent Deasphalting, Delayed Coking, etc.), but they are the minority in the market. The most part of the players need to look for sources of low sulfur crudes, which present higher cost putting under pressure his refining margins or look for deep bottom barrel conversion technologies to ensure more value addition to processed crude oils and avoid to loss competitiveness in the downstream market. For these refiners, deepest residue upgrading like hydrocracking technologies can offer great operational flexibility, despite the high capital spending. In this scenario, with necessity to higher value addition to bottom barrel stream and growing market of petrochemicals, refiners with adequate bottom barrel conversion capacity can achieve great competitive advantage in the downstream industry.

Integration between Refining and Petrochemical Assets – A Introduction

The main focus of the closer integration between refining and petrochemical industries is to promote and seize the synergies existing opportunities between the both downstream sectors to generate value to the whole crude oil production chain. Table 1 presents the main characteristics of the refining and petrochemical industry and the synergies potential.

As aforementioned, the petrochemical industry has been growing at considerably higher rates when compared with the transportation fuels market in the last years, additionally, represent a most noblest destiny and less environmental aggressive to crude oil derivatives. The technological bases of the refining and petrochemical industries are similar which lead to possibilities of synergies capable to reduce operational costs and add value to derivatives produced in the refineries. 

Figure 4 presents a block diagram that shows some integration possibilities between refining processes and the petrochemical industry. 

Figure 4 – Synergies Possible between Refining and Petrochemical Processes

Process streams considered with low added value to refiners like fuel gas (C2) are attractive raw materials to the petrochemical industry, as well as streams considered residual to petrochemical industries (butanes, pyrolisis gasoline, and heavy aromatics) can be applied to refiners to produce high quality transportation fuels, this can help the refining industry meet the environmental and quality regulations to derivatives.

           The integration potential and the synergy among the processes rely on the refining scheme adopted by the refinery and the consumer market, process units as Fluid Catalytic Cracking (FCC) and Catalytic Reforming can be optimized to produce petrochemical intermediates to the detriment of streams that will be incorporated to fuels pool. In the case of FCC, installation of units dedicated to produce petrochemical intermediates, called petrochemical FCC, aims to reduce to the minimum the generation of streams to produce transportation fuels, however, the capital investment is high once the severity of the process requires the use of material with noblest metallurgical characteristics.  

Crude Oil to Chemicals Strategy

           Due to the increasing market and higher added value as well as the trend of reduction in transportation fuels demand, some refiners and technology developers has dedicated his efforts to develop crude to chemicals refining assets. One of the big players that have been invested in this alternative is the Saudi Aramco Company, the concept is based on the direct conversion of crude oil to petrochemical intermediates as presented in Figure 5.

Figure 5 – Saudi Aramco Crude Oil to Chemicals Concept (IHS Markit, 2017)

The process presented in Figure 5 is based on the quality of the crude oil and deep conversion technologies like High Severity or petrochemical FCC units and deep hydrocraking technologies. The processed crude oil is light with low residual carbon that is a common characteristic in the Middle East crude oils, the processing scheme involves deep catalytic conversion process aiming to reach maximum conversion to light olefins. In this refining configuration, the petrochemical FCC units have a key role to ensure high added value to the processed crude oil. An example of FCC technology developed to maximize the production of petrochemical intermediates is the RxPRO? process by UOP Company, this process combines a petrochemical FCC and separation processes optimized to produce raw materials to the petrochemical process plants, as presented in Figure 6. Other available technologies are the HS-FCC? process commercialized by Axens Company, and INDMAX? process licensed by Lummus Company. The basic process flow diagram for HS-FCC? technology is presented in Figure 7.

Figure 6 – RxPRO? Process Technology by UOP Company. 

It’s important to taking into account that both technologies presented in Figures 6 and 7 are based on Petrochemical FCC units that presents especial design due to the sever operating conditions.

Figure 7 – HS-FCC? Process Technology by Axens Company. 

To petrochemical FCC units, the reaction temperature reaches 600 oC and higher catalyst circulation rate raises the gases production, which requires a scaling up of gas separation section. The higher thermal demand makes advantageous operates the catalyst regenerator in total combustion mode leading to the necessity of installation a catalyst cooler system.

Figure 8 presents the results of a comparative study, carried out by Technip Company, showing the yields obtained by conventional FCC units, optimized to olefins (FCC to olefins), and the HS-FCC? designed to maximize the production of petrochemical intermediates. 

Figure 8 – Comparative Study between Conventional FCCs and Petrochemical FCC (HS-FCC?)

It’s observed a higher reaction temperature (TRX) and a cat/oil ratio five times higher when are compared the conventional process units and the petrochemical FCC (HS-FCC?), leading to a growth of the light olefins yield (Ethylene + Propylene + C4=’s) from 14 % to 40%.

           The installation of petrochemical catalytic cracking units requires a deep economic study taking into account the high capital investment and higher operational costs, however, some forecasts indicate growth of 4,0 % per year to the market of petrochemical intermediates until 2025. In this scenario can be attractive the capital investment aiming to raise the market share in the petrochemical sector, allowing then a favorable competitive positioning to the refiner, through the maximization of petrochemical intermediates. Figure 9 presents a block diagram showing a case study demonstrating how the petrochemical FCC unit, in this case the INDMAX? technology by Lummus Company, can maximize the yield of petrochemicals in the refining hardware.

Figure 9 – Olefins Maximization in the Refining Hardware with INDMAX? FCC Technology by Chevron Lummus Global Company (SANIN, A.K., 2017)

In refining hardware with conventional FCC units, further than the higher temperature and catalyst circulation rates, it’s possible to apply the addition of catalysts additives like the zeolitic material ZSM-5 that can raise the olefins yield close to 9,0% in some cases when compared with the original catalyst. This alternative raise the operational costs, however, as aforementioned can be economically attractive considering the petrochemical market forecasts. 

Installation of catalyst cooler system raises the process unit profitability through the total conversion enhancement and selectivity to noblest products as propylene and naphtha against gases and coke production. The catalyst cooler necessary when the unit is designed to operate under total combustion mode due to the higher heat release rate as presented below.  

             C + ? O2 → CO (Partial Combustion) ΔH = - 27 kcal/mol

             C + O2 → CO2 (Total Combustion)      ΔH = - 94 kcal/mol

In this case, the temperature of the regeneration vessel can reach values close to 760 oC, leading to higher risks of catalyst damage which is minimized through catalyst cooler installation. The option by the total combustion mode needs to consider the refinery thermal balance, once, in this case, will not the possibility to produce steam in the CO boiler, furthermore, the higher temperatures in the regenerator requires materials with noblest metallurgy, this raises significantly the installation costs of these units which can be prohibitive to some refiners with restricted capital access.

Another key refining technology to crude oil to chemicals refineries is the hydrocraking units. Despite the high performance, the fixed bed hydrocracking technologies can be not economically effective to treat crude oils directly cue to the possibility of short operating lifecycle. Technologies that use ebullated bed reactors and continuum catalyst replacement allow higher campaign period and higher conversion rates, among these technologies the most known are the H-Oil and Hyvahl? technologies developed by Axens Company, the LC-Fining Process by Chevron-Lummus, and the Hycon? process by Shell Global Solutions. These reactors operate at temperatures above of 450 oC and pressures until 250 bar. Figure 10 presents a typical process flow diagram for a LC-Fining? process unit, developed by Chevron Lummus Company while the H-Oil? process by Axens Company is presented in Figure 11.

Figure 10 – Process Flow Diagram for LC-Fining? Technology by CLG Company (MUKHERJEE & GILLIS, 2018)

Catalysts applied in hydrocracking processes can be amorphous (alumina and silica-alumina) and crystalline (zeolites) and have bifunctional characteristics, once the cracking reactions (in the acid sites) and hydrogenation (in the metals sites) occurs simultaneously. 

Figure 11 – Process Flow Diagram for H-Oil? Process by Axens Company (FRECON et. al, 2019)

An improvement in relation of ebullated bed technologies is the slurry phase reactors, which can achieve conversions higher than 95 %. In this case, the main available technologies are the HDH? process (Hydrocracking-Distillation-Hydrotreatment), developed by PDVSA-Intevep, VEBA-Combicracking Process (VCC)? commercialized by KBR Company, the EST? process (Eni Slurry Technology) developed by Italian state oil company ENI, and the Uniflex? technology developed by UOP Company. Figure 12 presents a basic process flow diagram for the VCC? technology by KBR Company.

Figure 12 – Basic Process Arrangement for VCC? Slurry Hydrocracking by KBR Company (KBR Company, 2019)

In the slurry phase hydrocracking units, the catalysts in injected with the feedstock and activated in situ while the reactions are carried out in slurry phase reactors, minimizing the reactivation issue and ensuring higher conversions and operating lifecycle. Figure 13 presents a basic process flow diagram for the Uniflex? slurry hydrocracking technology by UOP Company.

Figure 13 – Process Flow Diagram for Uniflex? Slurry Phase Hydrocracking Technology by UOP Company (UOP Company, 2019).

As aforementioned, another commercial slurry phase hydrocracking process is the EST? technology by ENI Company, this process is shown in Figure 14.

Figure 14 – Basic Scheme for EST? Hydrocracking Technology by ENI Company (ENI Company, 2019).

Other commercial technologies to slurry hydrocracking process are the LC-Slurry? technology developed by Chevron Lummus Company and the Microcat-RC? process by Exxon Mobil Company.

For this side, the Steam cracking process has a fundamental role in the petrochemical industry, nowadays the most part of light olefins light ethylene and propylene is produced through steam cracking route. The steam cracking consists of a thermal cracking process that can use gas or naphtha to produce olefins.

           The naphtha to steam cracking is composed basically of straight run naphtha from crude oil distillation units, normally to meet the requirements as petrochemical naphtha the stream need to present high paraffin content (higher than 66 %). Figure 15 presents a typical steam cracking unit applying naphtha as raw material to produce olefins.

Figure 15 – Typical Naphtha Steam Cracking Unit (Encyclopedia of Hydrocarbons, 2006)

Due to his relevance, great technology developers has dedicated his efforts to improve the steam cracking technologies over the years, especially related to the steam cracking furnaces. Companies like Stone & Webster, Lummus, KBR, Linde, and Technip develop technologies to steam cracking process. One of the most known steam cracking technology is the SRT? process (Short Residence Time), developed by Lummus Company, that applies a reduce residence time to minimize the coking process and ensure higher operational lifecycle.

            The cracking reactions occurs in the furnace tubes, the main concern and limitation to operating lifecycle o steam cracking units is the coke formation in the furnace tubes. The reactions carry out under high temperatures, between 500 oC to 700 oC according to the characteristics of the feed (inlet temperature). For heavier feeds like gas oil, is applied lower temperature aiming to minimize the coke formation, the combination of high temperatures and low residence time are the main characteristic of the steam cracking process.

           As quoted above, some technology developers are dedicating his efforts to develop commercial crude to chemicals refineries. Figure 16 presents the concept of crude to chemicals refining scheme by Chevron Lummus Company.

Figure 16 – Crude to Chemicals Concept by Chevron Lummus Company (Chevron Lummus Global Company, 2019)

Another great refining technology developers like UOP, Shell Global Solutions, ExxonMobil, Axens, and others are developing crude to chemicals technologies, reinforcing that this is a trend in the downstream market. Figure 17 presents a highly integrated refining configuration capable to convert crude oil to petrochemicals developed by UOP Company.

Figure 17 – Integrated Refining Configuration Based in Crude to Chemicals Concept by UOP Company.

Due to the higher profitability when compared with the traditional refining configurations as quoted above, the Honeywell UOP Company presented the concept of Zero Fuels Refinery as described in Figure 18. 

Figure 18 – Zero Fuels Refinery Concept by Honeywell UOP

As presented in Figure 18, the production focus change to the maximum adding value to the crude oil through the production of high added value petrochemical intermediates or chemicals to general purpose leading to a minimum production of fuels. As aforementioned, big players as Saudi Aramco Company have been made great investments in COC technologies aiming to achieve even more integrated refineries and petrochemical plants, raising considerably his competitiveness in the downstream market. The major technology licensors as Axens, UOP, Lummus, Shell, ExxonMobil, etc. has been applied resources to develop technologies capable to allow a closer integration in the downstream sector aiming to allow refiners extract the maximum added value from the processed crude oil, an increasing necessity in a scenario where the refining margins are under pressure. Based on data from IHS Markit company in 2018 there were some capital investments in crude to chemicals projects as presented in Table 2.

Table 2 – Crude Oil to Chemicals Investments (IHS Markit, 2018)

Is expected that some of these capital investments was postponed due to the economic crisis provoked by the COVID-19 pandemic, but these data reinforce the trend in the market.

As aforementioned, face the current trend of reduction in transportation fuels demand at the global level, the capacity of maximum adding value to crude oil can be a competitive differential to refiners. Due to the high capital investment needed for the implementation that allows the conventional refinery to achieve the maximization of chemicals, capital efficiency becomes also an extremely important factor in the current competitive scenario as well as the operational flexibility related to the processed crude oil slate.  

           Although the advantages presented by closer integration between refining and petrochemical assets, it’s important to understand that the players of downstream industry are facing with a transitive period where, as presented in Figure 1, the transportation fuels are responsible by great part of the revenues. In this business scenario, it’s necessary to define a transition strategy where the economic sustainability achieved by the current status (transportation fuels) needs to be invested to build the future (maximize petrochemicals). Keep the eyes only in the future or only in the present can be a competitive mistake. 

Conclusion

           Nowadays, is still difficult to imagine the global energetic matrix free of fossil transportation fuels, especially for in developing economies. Despite this fact, recent forecasts and growing demand by petrochemicals as well as the pressure to minimize the environmental impact produced by fossil fuels creates a positive scenario and acts as main driving force to closer integration between refining and petrochemical assets, in the extreme scenario the zero fuels refineries tends to grow in the middle term, especially in developed economies.

The synergy between refining and petrochemical processes raises the availability of raw material to petrochemical plants and makes the supply of energy to these processes more reliable at the same time ensures better refining margin to refiners due to the high added value of petrochemical intermediates when compared with transportation fuels. The development of crude to chemicals technologies reinforces the necessity of closer integration of refining and petrochemical assets by the brownfield refineries aiming to face the new market that tends to be focused in petrochemicals against transportation fuels, it’s important to note the competitive advantage of the refiners from Middle East that have easy access to light crude oils which can be easily applied in crude to chemicals refineries. As presented above, crude oil to chemicals refineries is based on deep conversion processes that requires high capital spending, this fact can put under pressure the refiners with restrict access of capital, again reinforcing the necessity to look for close integration with petrochemical sector aiming to achieve competitiveness.

In the extreme side of the petrochemical integration trend, there are the zero fuels refineries, as quoted above, it’s still difficult to imagine the downstream market without transportation fuels, but it seems a serious trend and the players of the downstream sector need to take into account the focus change in his strategic plans like opportunity and threat.

References:

CHANG, R.J. – Crude Oil to Chemicals – Industry Developments and Strategic Implications – Presented at Global Refining & Petrochemicals Congress (Houston, USA), 2018.

COUCH, K. The Refinery of the Future – A Flexible Approach to Petrochemicals Integration. Honeywell UOP Company, Presented in 12th Asian Downstream Summit, 2019.

Deloitte Company. The Future of Petrochemicals: Growth Surrounded by Uncertainties, 2019.

Encyclopedia of Hydrocarbons (ENI), Volume II – Refining and Petrochemicals (2006).

FRECON, J.; LE BARS, D.; RAULT, J. – Flexible Upgrading of Heavy Feedstocks. PTQ Magazine, 2019.

LAMBERT, N.; OGASAWARA, I.; ABBA, I.; REDHWI, H.; SANTNER, C. HS-FCC for Propylene: Concept to Commercial Operation. PTQ Magazine, 2014.

MALLER, A.; GBORDZOE, E. High Severity Fluidized Catalytic Cracking (HS-FCC?): From concept to commercialization – Technip Stone & Webster Technical Presentation to REFCOMM?, 2016.

MUKHERJEE, U.; GILLIS, D. – Advances in Residue Hydrocracking. PTQ Magazine, 2018.

MULDOON, B.S. – Profit Pivot Points in a Crude to Chemicals Integrated Complex – Presented at Ethylene Middle East Technology Conference, 2019.

Refinery-Petrochemical Integration (Downstream SME Knowledge Share). Wood Mackenzie Presentation, 2019.

SARIN, A.K. – Integrating Refinery with Petrochemicals: Advanced Technological Solutions for Synergy and Improved Profitability – Presented at Global Refining & Petrochemicals Congress (Mumbai, India), 2017.

Dr. Marcio Wagner da Silva is Process Engineer and Project Manager focusing on Crude Oil Refining Industry based in S?o José dos Campos, Brazil. Bachelor 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) and is certified in Business from Getulio Vargas Foundation (FGV).