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By Hemant Kumar Domain Consultant Energy Practice
By the end of this presentation you’ll learn
• • • • • • • • The importance of energy in our lives Overview of oil and gas supply chain What are hydrocarbons Where do crude oil and natural gas come from How are they produced How are petrol, diesel etc are produced How are they delivered to us Who are various players in the industry
Chapter- 1 Introduction to Energy
You check your mails on your PC and find that you’ve won a quiz contest Picture This You read about the increase in crude oil prices in the newspaper You wash your most favourite T-shirt in washing machine You store the delicious dish you cooked last night in your fridge You spend quality time with your family watching a movie “dog’s life” .
Your house is sufficiently heated to protect you from cold weather. And light bulbs/tubes keep your house glowing at night .
And all that needs electricity to keep your day to day life running smoothly. The electricity comes from the power plant which runs on natural gas or coal .
Fortunately we have various ways to do that Train for long distances Public Transport for daily commutation Our personal vehicles for outings Planes for faster long distance travel And we need roads for our vehicles to run on .And Picture This Also World is not so small and we require the means to move from one place to another.
Unless of course you want to use a bicycle To build roads we need TAR which is also called COAL TAR…… .And we need fuel for all these modes of transport.…….
And can we live without food? Thanks to cooking gas. preparing food is no more inconvenient Plastic bags are widely used to carry the vegetables and other food items Vegetables we love to eat also need fertilizer We need fertilizer to grow the food crops .
travelling. comfort and safety. needs lot of energy. for preparing foods. recreation. The way.To cut a long story short.. The all-important energy comes from various sources like Crude oil & Natural Gas Wind Water Coal Sun . we live.
geothermal. crude oil and natural gas are all considered fossil fuels because they formed from the buried remains of plants and animals that lived millions of years ago Nuclear Fuel Coal .Types of energy Renewable Renewable Energy is energy derived from resources that are regenerative (can be replenished in a short period of time) or for all practical purposes cannot be depleted Renewable energy accounts for about 14% of the world's energy consumption The five renewable sources used most often include hydropower (water). Crude oil & Natural Gas Biomas s Wind Geothermal Sun Water Non Renewable Nonrenewable energy sources come out of the ground as liquids. solar. and biomass. Non-renewable sources of energy can be divided into two types: fossil fuels and nuclear fuel Coal. gases and solids. wind.
which are nonrenewable energy resources. produced and delivered to us by oil and gas companies who engage in multiple activities which will be described in this presentation So let’s get ready to learn about oil and gas industry. we should know that they are found. Hydrocarbons (oil and gas).Welcome to Oil and Gas industry • Now that we have understood the importance of energy in its various forms. we also need to know where it comes from. contribute almost 50% of the total world energy requirement. In the next chapters we’ll try to know more about hydrocarbons which are very important source of energy and critical to our economic growth and survival. When we talk about hydrocarbons. • • • Finding & producing hydrocarbons Transporting hydrocarbons Refining hydrocarbons Selling the petroleum by products .
Midstream. They are mainly a) Upstream (Finding & producing hydrocarbons) b) Downstream (Refining hydrocarbons and producing saleable petroleum byproducts) c) Retail (Selling the byproducts to all the users who need them).Petroleum Value Chain Picture below gives an overview of the supply chain of the oil and gas industry. though is not a very popular term is used to describe the transport part.com Platform Producers Upstream Midstream Downstream Retail . Truck Refineries Wellhead Producers Terminal/Storage/H ub Location Bulk Terminal Storage Gas Stations Platform Producers Platform Producers Source:http://www.adventuresinenergy. Industry is organized into three broad categories based on the activities performed therein.
2 Origin of Oil & Gas .Chapter.
four hydrogen atoms • From now we’ll use terms hydrocarbons and oil & gas interchangeably (which is perfectly alright) . • Chemicals based on carbon and hydrogen are called as hydrocarbons • The Simplest Hydrocarbon is methane (CH4) is made up of one carbon.What Hydrocarbons are • Hydrocarbons are naturally occurring chemicals that are made up of just two elements – carbon and hydrogen.
doe. As soon as the oxygen is used up. the remains were covered by layers of sand." Nowadays the terms petroleum is used as a common denotation for crude oil and natural gas.gov/kids/energyfacts/sources/non-renewable/oil. These produce tiny droplets of hydrocarbons Source. Hydrocarbon Formation Once the body of prehistoric animals and plants became trapped they partially decomposed using up the dissolved oxygen in the sediment. i. subject the organic matter to higher temperatures and pressures.eia. the hydrocarbons. Over the years.html#How%20used .e.Origin of Oil and Gas Oil was formed from the remains of animals and plants that lived millions of years ago in a marine (water) environment even before the dinosaurs.. Continued burial. Heat and pressure from these layers helped the remains turn into what we today call crude oil .http://www. which cause physical and chemical changes in the organic. decay stops and the remaining organic matter is preserved. The word "petroleum" means "rock oil" or "oil from the earth. silt and mud.
What a petroleum bearing rock looks like • Oil can be found with in the depth of ranging between 2km – 9km .Origin of Oil and Gas Facts • Oil & gas do not occur in an underground pool but lies in the pore pace of the rocks which are also called the source rocks • The oil & gas are forced through the rock on account of three reasons •Expansion of the oil itself •Expansion of gas from above •Pressure of the encroaching water from below.
However a source rock as we call it will be no good on its own as oil & gas therein will leave the source rock and migrate to other areas. A word of Caution: Don’t try it at home ☺ If it’s very difficult to do. don’t worry.Origin of Oil and Gas-Do it yourself You can visualize what a rock containing crude oil & natural gas would look like. Does it make life difficult for those looking for large deposits of oil and gas? Not exactly! . As shown in the picture below. take a bucket. A rock will contain the hydrocarbon the same way. in its pores. Sounds simple!! Isn’t it? Except that a petroleum reservoir is more complicated in its nature and very difficult to find out. You can imagine a sponge soaked with water or petrol. a can of petrol and gas. Try mixing them together and resulting mixture would resemble a reservoir.
Petroleum SystemIs a oil & gas bearing structure containing source.Petroleum System As we learnt.Origin of Oil and Gas. reservoir and cap rocks. oil and gas originate in source rock and once fully formed they start moving towards the surface through channels in the rocks surrounding the source rocks. An oil & gas field consists of one or many such petroleum systems Petroleum System Source Rock Pore is a small open space between the rock particles Permeability is provided by the channels connecting different pores . Once their upwards movement is impeded by non permeable rocks also called trap or seal or cap rocks they tend to accumulate in the porous (containing pores) and permeable rocks also known as reservoir rocks.
Chapter.3 Oil & Gas Exploration & Production .
Exploration.Finding Oil & Gas Oil & gas fields are identified using seismic data which is obtained from Seismic Surveys Seismic Data Acquisition Seismic Survey Seismic Data obtained from Seismic Survey Computer generated model of underground rocks and trapped oil&gas reserves Seismic Data processed at the Workstation .
floats and retains its stabilized position by means of anchors fixed on the seabed. drilling is done which is also called as exploratory drilling. as opposed to other floating rigs. . Used in shallow depth Jack up Rig Semisubmersible Rig Drill Ship Semi-submersible Rig. Drilling is done using drilling rigs each adapted to different water depths (more than 2000 m in some cases) Jack up Rig. A drill ship must stay relatively stationary on location in the water for extended periods of time. This allows the working platform to rest above the surface of the water.is a ship designed to carry out the drilling operations in deep water. dynamic propulsion (thrusters) or a combination of these. Used in deep waters Sea Bed Water Level Drill Ship.is fitted with long support legs (3 0r 4) which are lowered until they rest on the sea bottom. This positioning may be accomplished with multiple anchors.Finding Oil & Gas To confirm the interpretations of the seismic data.Exploration.
A drill string is composed of hollow lengths of pipe leading to the surface.Exploratory Drilling Once an area has been selected and the right to drill thereon has been obtained. which is the most important part and also is hollow and very heavy. is attached to the drill string. Rotary drilling operates on the principle of boring a hole by continuous turning of a bit.Exploration. The bit. more lengths of pipe can be added at the top. actual drilling may begin. Drill Bit . As the hole gets deeper. The most common method of drilling in use today is rotary drilling.
On an average the strike rate varies between 5% to 15%. Oil companies are using the modern technologies to increase the strike rate companies are using the modern technologies to increase the strike rate during exploration during exploration •Hydrocarbons discovered by the initial exploration wells are further •Hydrocarbons discovered by the initial exploration wells are further confirmed by appraisal drilling i. •Enormous thought goes into the best way of extracting the hydrocarbons. Drilling well is very costly activities especially in deep water. These forecasts. Once everything installations constitute the development stage of the field. decision is taken whether to develop the field for commercial extraction or stop further activities in case the producible for commercial extraction or stop further activities in case the producible quantity of oil and gas do not justify the investment in development. studies and the eventual construction of the conditions. attempting to recover the maximum quantities of oil and gas in the safest attempting to recover the maximum quantities of oil and gas in the safest conditions. These forecasts. extraction can start. studies and the eventual construction of the installations constitute the development stage of the field. extraction can start. Oil ••Drilling aawell is aavery costly activities especially in deep water. On an average region where exploratory activities are being performed. means the 99of them would be dry holes.e. It also means the of them would be dry holes. The life of an oil field continues for many years years Production Production . drilling more wells in the area •Following appraisal drilling. •Enormous thought goes into the best way of extracting the hydrocarbons. drilling more wells in the area confirmed by appraisal drilling i. quantity of oil and gas do not justify the investment in development.Oil & Gas Production Exploration Exploration •Oil companies have to drill many exploratory wells before discovering •Oil companies have to drill many exploratory wells before discovering aa potential oil filed which is also called as prospect. The success rate also known as strike rate depends on the geological history of the particular known as strike rate depends on the geological history of the particular region where exploratory activities are being performed.e. For example aa10% strike rate would mean one prospect among 10 exploratory wells drilled. It also would mean one prospect among 10 exploratory wells drilled. For example 10% strike rate the strike rate varies between 5% to 15%. Once everything is in place. The life of an oil field continues for many is in place. The success rate also potential oil filed which is also called as prospect. decision is taken whether to develop the field •Following appraisal drilling.
Question is. The horizontal well has a much greater length of contact with the reservoir. Moreover.Oil & Gas Production Production consists of bringing the hydrocarbons contained in the subsurface to the surface. Thus. such wells only cross the reservoir over the limited height of a vertical or near vertical cross section. However drilling horizontal involves a lot of technical complexity and is also more costly Reservoir Small Drainage Area for Vertical Well Large Drainage Area for Horizontal Well . the technique enables a significant reduction in the number of wells necessary for a given development. This requires the use of a large number of wells. at least several km² and sometimes more than 100 km² A traditional well (vertical or slightly deviated) only draws oil or gas from a radius of a few tens of meters. •. A large number of vertical wells would therefore be necessary to completely extract the contents of a reservoir. how many wells are required? Imagine A field spreads over a vast area.
Oil & Gas Production.Development It’s not enough to drill wells in a field to ensure production. safety equipments and other installations are set up. To ensure safe production from the high pressure fields. The picture below shows an offshore oil platform which takes production from 10-12 wells housed within the platform Oil Wells .
4 Oil & Gas Transportation .Chapter.
Transportation The crude oil & gas transportation begins from the wells where production from different wells is taken to a large processing platforms via small diameter (2-8 inches) pipes. sulfur. refineries & gas processing units via pipelines or tankers (more about these later) . At process platform oil. gas and water are separated and impurities like condensate. hydrogen sulphide removed. After processing crude oil and gas are sent to the their respective destinations.
at which point the transport tanker connects to the stern to the stern or bow of the FPSO and offloads the oil. Oil is processed and accumulated in the FPSO until there is sufficient to fill a transport tanker. In a sub sea well wells are located on the seabed as opposed to the conventional wells at the surface Oil Tanker The FPSO is usually a decommissioned oil tanker which has been stripped down and equipped with facilities to process and stabilize the crude oil and enable it to be connected to another oil tanker or transport tanker.Transportation FPSO ( Floating Production Storage Offloading) are used where it’s not possible or economically justifiable to install sea bed pipelines or expensive process platforms. FPSO’s find their application in sub sea wells in remote and deep water fields. Sea Bed .
However in majority of the cases Maritime (large oil tankers) and Pipelines are the most preferred means of transport. the need to be sent to the refineries/processing units for further processing. Let’s learn a little more about them . Broadly there are four modes of oil & gas transportation Pipeline. transportation of crude oil to its destination (refineries) is sometimes very complicated. Maritime. Sometimes many modes of transports are utilized to achieve this goal.Transportation Once the crude oil and natural gas are separated. volume. distance. Railways & Trucks. Maritime Pipelines Truck Railways Many factors determine the choice of one mode of transport over another like cost. accessibility. sea or hills. time and availability. Since most of crude oil & gas are found in remote places like deserts.
it’s one of the of the largest pipeline systems in the world. Carrying capacity of a pipeline is expressed in terms of thousands barrel per day Pipeline shown in the picture is Trans Alaska Pipeline System (TAPS).Oil Transportation-Pipelines Pipelines are large diameter tubes that can transport enormous quantities of oil. most efficient and economical way of transportation. The oil travels in the pipelines at speeds of around 2m/sec (7km/h).24 inches in diameter) in the U. The network of crude oil pipelines in the U. Since oil is produced in areas far away from major marketplaces where population and manufacturing centers are located. There are approximately 55.S.000 miles of crude oil trunk lines (usually 8 . The oil circulates by means of pressure maintained by pumping stations located every 60 to 100 km.S. 800 mile long. up to several tens of millions of tons per year. unlike most pipelines. has significant portions of the system above ground. It’s also the most photographed pipeline as it. Due to the very nature pipelines are considered to be the safest. Pipelines are owned by the oil companies or third party operators who lease the pipelines to the oil companies. pipelines permit the movement of crude oil to these areas with little or no disruption to communities everywhere.of any nation in the world. is extensive. that connect regional markets . The United States has the largest network of energy pipelines – both oil and natural gas -.
In order to benefit from economies of scale companies typically charter the largest possible vessel that can be accommodated in their arrival and discharge ports. independent owners account for approximately 80. The oil tanker fleet in divided into six major categories.Mid size vessels used for short to medium hauls(carrying capacity.200.000 to 200.000 dwt and greater) Suezmax and Aframax.80.000 dwt) • • • The seaborne crude oil transportation business is highly fragmented and is generally provided by two types of operators: independent ship owners and captive fleets of privately and state owned oil companies. Panamax and Handysize. and the top ten owners account for 26.000 to 80. These two are most commonly used. The six categories of vessels are: ULCCs and VLCCs (Ultra and very large crude oil container) – Largest vessels used for long hauls(carrying capacity.000 dwt).Oil Transportation-Maritime Maritime transport involves transporting crude oil through large oil tankers. Within the industry. based on their carrying capacity.4% of the world tanker fleet .10.4% of the tanker capacity.Small size vessels used for short hauls (carrying capacity.
production and consumption points are far apart and gas has to be taken from one to the other.http://www.html . it occupies a volume 600 times greater than that of oil. the gas is in a gaseous state at normal pressures and temperatures.Gas Transportation Overall. Unlike oil. there is no question of chartering vessels to transport gas in its gaseous state. with the aid of compression plants positioned at regular intervals along the network. These gas pipelines are not visible: for reasons of safety and security they are buried underground. the problems of transport and of storage of gas are the same as for oil. for the same quantity of energy. This means that. Therefore. But in detail.com/content/oil-gas/distribution/supply-storage-gas. The compressed gas circulates at high speed in a gas pipeline. liquefied natural gas) is used Source.planete-energies. things are quite different. a method of maritime transport based on the liquefaction of the gas (LNG. Overland or underwater transport by gas pipeline is preferred. That would cost … 600 times too much! The most usual method of transportation is therefore by gas pipelines. In certain cases where the construction of gas pipelines is technically impossible or too expensive.
These commitments have been incumbent on members of the European Union since 1968. the strategic stocks are managed by state or private organizations (or both) • Storage tanks at a marine terminal Storage tank .000 litres) and can often be buried underground due to safety and security reasons In addition. They are committed to holding stocks of petroleum products (crude and finished products) equivalent to 3 months of import quantities. the developed countries have realized for a long time now the strategic importance of oil. the cargo of crude oil is discharged through pipelines to storage tanks in the refinery Storage tanks come in varying size (more than 500. Depending on the country.Crude Oil Storage • • • At the marine terminal.
so that injection of the gas is not too expensive in energy terms.Gas Storage • Due to reasons such as seasonal fluctuation or supply-demand change. All one need is a suitable geological site which must must possess good reservoir and cap rock conditions and be located at a sufficiently shallow depth (around 500m). Only drawback is that such ideal sites are not numerous and in most of the cases liquefaction of gas to convert it into LNG is the only option Ariel view of a LNG plant • Source. There are two ways to store the natural gas.http://www.html . in LNG form in large tanks & underground reservoirs. storage of gas is essential.com/content/oil-gas/distribution/supply-storage-gas. and there is no need to refrigerate the gas to liquefy it as in LNG.planete-energies. Underground reservoirs offer enormous storage capacities to the extent of billions of m³.
2 billion to clean up the spill. the main issues are those of safety. everything must be done to avoid pollution. security and respect for the environment. • Oil Spill Pipeline Leak The largest oil spill involving a U. not only accidental oil spills but also the deliberate discharging of polluting products such as the residue from tank and bilge cleaning. 10. 1. 100 airplanes & $1. killing hundreds of thousands of birds and marine animals and soiling more than 1.000 boats. vessel occurred when the Exxon Valdez oil tanker emptied 11 million gallons of crude oil into Prince William Sound off the coast of Alaska in 1989. . On land the state of oil pipelines must be continually kept under surveillance and worn equipment replaced.Transportation & Storage-Safety Aspects • Whether oil is transported from production sites to the refineries by maritime or pipeline methods.000 workers. Most dangerous are oil spills which pose enormous threat to the environment Same precautions go for storage also as enormous quantities of oil transported are not used immediately.S.200 miles of rocky beach. At sea. Storage facilities ensuring total safety and security must therefore be planned for petroleum products. It took company four summers.
5 Oil Refining .Chapter.
well adapted to their use.Refining Crude Oil Why do we need to refine the crude oil? Why can’t we build engines that run on crude oil? We need to refine the crude oil because • Crude oil is an unstable mixture of several hydrocarbons in varying quantities according to the density of the products • There is not one type of crude oil but a multitude of different crudes • Different crudes contain dissolved gases. Let’s learn more about the refining and refineries… . These transformations are carried out in refineries. sulphuric or acid products which are very corrosive for metals That is why the crude oils must be purified and transformed into products having an almost constant composition.
Kerosene. Typical refinery products are LPG.Introduction to Petroleum Refinery A refinery is a factory. Gasoline. Diesel. Asphalt and Tar . Just as a paper mill turns lumber into paper. A refinery can occupy as much land as several hundred football fields. Workers ride bicycles to move from place to place inside the complex. 365 days a year and requires a large number of employees to run. A typical refinery costs billions of dollars to build and millions more to maintain A refinery runs twenty-four hours a day. Fuel oil. a refinery takes crude oil and turns it into gasoline and hundreds of other useful products. Lubricating oil. Paraffin wax.
Output is commercial products which are used by us Crude Oil Primary Processing Raw Products Secondary Processing Commercial Products Separation Conversion . b) Conversion (Cracking) and c) Reforming d) Blending & Treatment Crude oil contains many components which differ in boiling points. Moreover crude oil can be categorized under •Light •Heavy (Asphaltic) •Sweet (Non-sulfurous-less than 1% of sulfur) •Sour (Sulfurous-more than 1% of sulfur)) Crude oil processing consists of two parts Primary Processing.Output is raw (primary) products Secondary Processing. refining breaks crude oil down into its various components. relative solubility. All refineries perform four basic steps: a) Separation (Distillation). which then are selectively reconfigured into new products.What does refining actually do? Essentially.
separate lower down.Primary Processing-Separation Primary processing involves distillation at atmospheric pressure or under vacuum. vaporize and rise to the top of the tower. while the heaviest fractions with the highest boiling points settle at the bottom.http://www.eia.doe. including kerosene and diesel oil distillates. the liquids and vapors separate into components or fractions according to weight and boiling point. stay in the middle. The lightest fractions.html . (Heavier liquids. Medium weight liquids.gov/kids/energyfacts/sources/non-renewable/refinery. including gasoline and liquid petroleum gas (LPG). where they condense back to liquids.) Source. called gas oils. Distillation causes separation of breaking up of crude oil into various petrochemicals Inside the towers.
Primary Processing-Separation AS we learnt that distillation is done using two methods a) Atmospheric distillation b) Vacuum Distillation Atmospheric distillation Vacuum distillation .
We’ll learn more about these processes Source. rearrange them to add value. skinny towers that loom above other refinery structures. Other refinery processes. The process. instead of splitting molecules. The most widely used conversion method is called cracking because it uses heat and pressure to "crack" heavy hydrocarbon molecules into lighter ones. takes place in a series of large. horizontal vessels and tall.eia.Secondary Processing-Conversion Primary products require further adjustment of chemical composition in order to become suitable for sale or petrochemical processing. bullet-shaped reactors and a network of furnaces. for example. relatively low-value fraction. Reforming uses heat.gov/kids/energyfacts/sources/non-renewable/refinery.html . which essentially is cracking in reverse. This transformation takes place during conversion stage. makes gasoline components by combining some of the gaseous byproducts of cracking. a light. into high-octane gasoline components. Conversion is directed towards maximum gasoline production Cracking unit Cracking is not the only form of conversion.http://www. A cracking unit consists of one or more tall. Alkylation’s.doe. heat exchangers and other vessels. moderate pressure and catalysts to turn naphtha. thick-walled.
FLUID CATALYTIC CRACKING HYDROCRACKING Hydrocracking is a two-stage process combining catalytic cracking and hydrogenation.Secondary Processing-Conversion Some of the conversion processes are shown below VISBREAKING A mild form of thermal cracking. wherein heavier feedstocks are cracked in the presence of hydrogen to produce more desirable products. DELAYED COKING . In delayed coking the heated charge (typically residuum from atmospheric distillation towers) is transferred to large coke drums which provide the long residence time needed to allow the cracking reactions to proceed to completion. significantly lowers the viscosity of heavy crude-oil residue without affecting the boiling point range. oil is cracked in the presence of a finely divided catalyst which is maintained in an aerated or fluidized state by the oil vapors.
Reforming Reforming is another process designed to increase the volume of gasoline that can be produced from a barrel of crude oil. . Reforming rearranges Naptha hydrocarbons into Gasoline molecules CATALYTIC REFORMING Catalytic reforming is an important process used to convert low-octane naphthas into highoctane gasoline blending components called reformates. For example. but their structure is generally more complex. Hydrocarbons in the Naptha (another petroleum byproduct) stream have roughly the same number of carbon atoms as those in gasoline.
such as whether the gasoline will be used at high altitudes. vapor pressure ratings and special considerations. oxygen.Blending & Treatment The finishing touches occur during the final treatment. Among the variables that determine the blend are octane level. . refinery technicians carefully combine a variety of streams from the processing units. sulfur. and metals from liquid petroleum fractions. To make gasoline. Impurities like Sulfur are also removed to make Gasoline as clean as possible CATALYTIC HYDROTREATING Catalytic hydrotreating is a hydrogenation process used to remove about 90% of contaminants such as nitrogen.
it gets bigger after it is popped. Bottled Gas Petrol Other Products Liquefied Petroleum Gas (LPG) Chemical Works Heavy Fuel Oil Jet Fuel Jet Fuel Diesel Fuel & Heating Oil Gasoline Diesel Fuel Lubricating Oil Don’t be surprised to know that a barrel of crude oil after refining will provide slightly more than 1 barrel of petroleum products. Source. Wax Fuel Oil Power Station Tar (bitumen ) for roads If you are still wondering how much of what is produced here is a general breakup of the quantity of petroleum products produced in a refinery. For example. However the product mix can be changed as needed. This gain from processing the crude oil is similar to what happens to popcorn.gov/kids/energyfacts/sources/non-renewable/oil. You can see below that petroleum in its more refined form contribute heavily to the modern economy. It provides the building blocks for countless products we depend on every day. However that would also mean something else will be produced less.doe.Some More About Refinery To Summarize every barrel of crude holds remarkable potential.eia.http://www.html#How%20used . the same barrel can be processed to yield more heating oil in winter.
Some More About Refinery
Types of refinery
•Topping – CDU •Hydroskimming – CDU + Reformer •Cracking – CDU + Cracker •Coking – CDU + Cracker + Coker
Some of the refineries we may not have heard of
•Haldia Refinery (IOC) 116,000 bpd •Panipat Refinery (IOC), 240,000 bpd •Digboi Refinery(IOC), 13,000 bpd •Gujrat Refinery(IOC), 68,000 bpd •Barauni Refinery (IOC), 116,000 bpd •Guwahati Refinery (IOC), 20,000 bpd •Mathura Refinery (IOC), 156,000 bpd •Bongaigaon Refinery(BRPL), 48,000 bpd •Manali Refinery (CPCL), 185,000 bpd •Jamnagar Refinery (RIL), 660,000 bpd •Mumbai Refinery (HPCL), 107,000 bpd •Vizag Refinery (HPCL), 150,000 bpd •Mumbai Refinery (BPCL), 135,000 bpd •Kochi Refinery, 146,000 bpd •Numaligarh Refinery (NRL), 58,000 bpd •Mangalore Refinery (MRPL), 190,000 bpd
World's Largest Refineries
•Paraguana Refining, Venezuela - 940,000 bpd •SK Corporation, South Korea - 817,000 bpd •Reliance I, India - 661,000 bpd •GS Caltex, South Korea - 650,000 bpd •Exxon Mobil, Singapore - 605,000 bpd •Reliance II, India (proposed) - 580,000 bpd •Exxon Mobil, Baytown, USA - 557,000 bpd •S-Oil, South Korea - 520,000 bpd •Hovensa LLC, Virgin Islands - 495,000 bpd •Exxon Mobil, Baton Rouge, USA - 493,500 bpd •Shell Eastern, Singapore - 458,000 bpd
Chapter- 6 Oil Distribution
Each one of us is a user of petroleum products. Between the refinery, where heating oil, diesel, petrol and gas are produced, and the end user, there is a distribution network that is responsible for getting these products to their final destination. Making available to each person the right product, at the right time, at the right place and at the lowest cost and in optimum conditions of safety and security, is the objective of petroleum logistics.
Am overview of petroleum distribution network
The products are regularly inspected throughout the whole distribution chain. Ariel View of Petroleum Depots Source. and aviation fuel A petroleum depot consists of 10 to 30 steel tanks. In absence of any intermediary storage centres.Petroleum Depots Taking the petroleum products directly from the refinery to the customer is a complicated task. from the refinery to the end user. A tank can be as large as 60 000 m3. Other advantage of having depots is smoothening demand-supply imbalance caused by increased demand or disruption in supply.planete-energies.000 and 300. Depot capacities are very variable. trains of tanker wagons. as well as special diesel fuels used by farmers and fishermen. river/canal barges. The principal products stored are heating oil. Each depot has 3 to 12 loading bays for the road tankers that will deliver the products to different consumers.http://www. That’s where strategic stocks also come into picture The petroleum products are taken from the refineries to the depots by bulk transport methods: pipelines.Oil Logistics. petrol and diesel.html . Petroleum depots are used as intermediate storage to serve a particular region.com/content/oil-gas/logistics-supply. to guarantee the maintenance of product quality and the absence of contamination by mixing. on average between 10. it would require large numbers of road tankers covering enormous distances everyday to meet the consumption needs.000 m3. boats.
Refinery Delivering fuel to the consumers Road Tankers Depots Hypermarket Petrol Pumps Petrol Pumps Petrol Pumps Source:http://www. are supplied directly from the refineries by rail (tanker wagons). From petroleum depots. Let’s know more about these filling/gas station. the distribution network involves intermediate stages. large numbers of road tankers deliver fuel to filling stations and heating oil and gas to individuals and to companies. by river and canal barges or even by pipelines carrying finished products. For the other consumers like us.Oil Logistics-Delivering to the End User Last step in petroleum supply chain is delivering the finished products to all the users who need them.com . industrial plants. The major users.adventuresinenergy.
Some stations carry specialty fuels such as liquified petroleum gas (LPG). fueling station. biodiesel. . gas station or petrol station is a facility which sells fuel and lubricants for motor vehicles. it's called a Petrol Pump or petrol bunk. compressed natural gas (CNG). where petrol is known as "gas" or "gasoline.“ Elsewhere in the English-speaking world the form "petrol station" or "petrol pump" are used. it is called a "gasoline stand". or kerosene. hydrogen. In Australia. In Japanese English. And finally in Indian English.Oil Logistics-Gas Station Filling station. The term "gas station" is mostly used in the United States and Canada. ethanol. The most common fuels sold are gasoline (petrol) or diesel fuel. the term service station ("servo") describes any petrol station.
dot. from the refinery to the end user. to guarantee the maintenance of product quality and the absence of contamination by mixing.htm .phmsa.gov/comm/PetroleumPipelineSystems.http://primis.Gas Logistics The products are regularly inspected throughout the whole distribution chain. Source.
Price of petroleum products vary from country to country as tax rates are different. For example in Europe taxes on petroleum products are as high as 70% as a result of which a litre of petrol would be costlier in Europe than in US . 23% to federal and state taxes and 47% to crude oil.Prices and Taxes Did you know that the price that you pay at the pump is a lot higher than the cost price of the products? Why this difference? It results from the fiscal policy in the consumer country. 12% of what you paid went to distribution & marketing. Figure shows the various components of price of a gallon (3.78 litre) at a petrol pump in US in 2004. As you can see. 18% to refining costs& profits.
you should have the understanding of the supply chain in Oil and Gas industry.http://primis. Please go through the following picture to have a quick recap of what you have learnt so far.phmsa.gov/comm/PetroleumPipelineSystems.dot. Source.Overall Oil & Gas Industry Supply Chain Till this point.htm .
A quick Recap before we move to the last section We learnt so far • The importance of energy in our lives • Overview of oil and gas supply chain • What are hydrocarbons • Where do crude oil and natural gas come from • How are they produced • How are petrol. diesel etc are produced • How are they delivered to us .
7 Oil & Gas Producers .Chapter.
Shell. are also generally categorized as majors or supermajors. supplying oil companies with personnel and equipment that the latter do not own or employ themselves. which take over oil fields near the end of their useful lives. • Companies operating in the oil sector as suppliers of services to oil companies. mainly for exploration and production. organizations and consultants all play a part in the “hydrocarbon universe” •National companies. •Companies specializing in gas distribution. OAPEC (the Organization of Arab Petroleum Exporting Countries) or the IEA (the International Energy Agency). Example. The best-known are. the largest in terms of proven reserves and production. in many countries. For example French Oil Institute •Independent consultants and other organizations or individuals who offer consultancy & design services and technical audits to the oil companies . manage oil production and defend national interests in the hydrocarbon sector. But they are not the only ones. depth imaging. the largest gas producer in the world •National agencies & government departments with responsibility for energy matters (For example DOE (Department of Energy) in the United States the DOE •International organization. •Research institutes. or develop fields that have been abandoned by the major companies.Oil & Gas Companies There are numerous actors in the world of oil and gas. of course. the major oil companies and OPEC. Total and Chevron/Texaco. A myriad of companies. •International Oil Companies. drilling.Maurel et Prom in France. which. •Small independent oil companies.Goservices. such as Gazprom. which are often training centers too. Among the best known: Schlumberger. production equipment ). Transocean Sedco Forex These companies are involved in specific technical areas (geophysical surveying and analysis. Example Suadi Aramco. such as OPEC (the Organization of Petroleum Exporting Countries). BP. Halliburton. Examples include Exxon Mobil.
. but Shell’s daily production is enough to meet India’s daily Energy consumption.Some Statistics on Oil Majors Look at the graphs below to find out how the five majors compare with the other top companies in the world Profit (Million $) Revenue (Million $) Believe it or not.
in favor of the former. This system has allowed OPEC to fix a range for oil prices and thus to maintain price stability. Saudi Arabia. OPEC has virtually lost its ability to control prices. At the beginning. These quotas are adjusted. the main objective of this organization was to redress the split of income between the oil producing countries and the oil companies. at regular or extraordinary conferences. Kuwait. Iraq. Iran. to take account of the state of the world economy and its requirements. (what is called excess capacity). Libya. Qatar. Algeria. •OPEC works on the principle of limiting oil production by means of the allocation of quotas (authorized maximum quantities) to each of its members according to their reserves. have become very limited. Venezuela.The Institutions and Other Organization OPEC (Organization of Petroleum Exporting Countries) •Was founded in 1960 by Iraq.Nigeria and Indonesia . But since 2004. Venezuela. the United Arab Emirates (UAE). As a result. Kuwait and Iran. which have tended to soar in the recent times •Eleven members of OPEC are Saudi Arabia. OPEC production has been working at almost full capacity and the possibilities of increasing production further.
In 2005. economic growth and environmental protection. The IEA keeps a sharp eye on the evolution of oil markets. as a reaction.The Institutions and Other Organization The International Energy Agency (IEA) • IEA unlike OPEC is an association of consumer countries. the IEA seeks to establish common ground and compromise solutions between signatories and non-signatories (the United States and Australia) of the protocol. all of which are industrialized countries and major hydrocarbon consumers. and to the use of oil as an economic arm by Arab countries. In a completely new and unexpected step. both to the OPEC offensive when petroleum prices rocketed at the end of 1973. The IEA is an autonomous unit within the Organization for Economic Co-operation and Development (the OECD). In addition. It was created in 1974. • • • . With regards to the Kyoto protocol. It is an intergovernmental organization for the co-ordination of energy polices. The IEA works towards security of energy supplies. at the initiative of the United States. in which it recommended consumer countries to take preparatory steps to limit their oil consumption. They have also undertaken to pool information. and also plays a more and more important role in the protection of the environment. the IEA made a report public on the 28 th of April 2005. it had 26 members. governments of the member countries have undertaken to implement joint measures to deal with emergency situations concerning petroleum supplies.
Chapter.8 Production & Consumption Pattern .
World Oil and Gas Review . Russia.Reserves Middle East (Saudi Arabia. Iran.507 million barrels per day. UAE) boasts of 60% of total world oil reserves followed by Venezuela. Iraq. Total world oil consumption as of 1st Jan 2007 were 1. Million Barrels as on 1st Jan 2007 Source.147. Nigeria and rest of world. Libya. Kuwait.
Consumption US is way ahead of the pack when it comes to oil consumption followed by China. Thousand Barrels per Day as on 1st Jan 2007 Source. Japan. Total world oil consumption as of 1st Jan 2007 was 84.World Oil and Gas Review . Germany and India. Russia.5 million barrels per day.
7 million barrels per day Thousand Barrels per Day as on 1st Jan 2007 Source.Production Saudi Arabia claims the maximum contribution to the world oil production followed by Russia.World Oil and Gas Review . US. Iran. Total world oil consumption as of 1st Jan 2007 was 83. Mexico and China.
Production and Reserves Comparison Snapshot .Consumption.
html A cross section of an oil tank Back .http://www.com/content/oil-gas/logistics-supply/depots.planete-energies.
An inside view of a petrol pump/station Back .
html • http://www.html • http://science.html • http://www.eia.com/intera ctive/all_5000.com/oil.com/oildrilling.com/content/oil-gas.gov/basics/petroleum_ basics.adventuresinenergy.html .gravmag.howstuffworks.doe.You can visit these sites for more learning • http://www.html • http://www.planeteenergies.
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