Ui

APPENDIX U

PETROLEUM REFINING



Uii


Uiii
APPENDI X U

PETROLEUM REFINING

GREGORY R. RUSCHAU, PH.D.
1
AND MOHAMMED A. AL-ANEZI
2



SUMMARY AND ANALYSIS OF RESULTS

Corrosion Control and Prevention

Petroleum refining is an industry that is undergoing intense amounts of scrutiny in the United States from
regulatory agencies and environmental groups. As a result, releases of pollutants caused by corrosion leaks are
becoming a high-consequence event. The Clean Air Act of 1990 has forced refineries to implement a number of
costly measures to reduce their impact on the environment, both in the types of products they produce and the
manner in which they operate.

The total cost of corrosion control in refineries is estimated at $3.692 billion. Of this total,
maintenance-related expenses are estimated at $1.767 billion annually, vessel turnaround expenses account for
$1.425 billion annually, and fouling costs are approximately $0.500 billion annually. The costs associated with
corrosion control in refineries include both processing and water handling. Corrosion-related issues regarding
processing include the handling of organic acids (broadly referred to as napthenic acid corrosion) and sulfur species,
particularly at elevated temperatures, as well as water carried over in processing vessels and pipelines. Water
handling includes concerns with corrosives such as H
2
S, CO
2
, chlorides, and high levels of dissolved solids.

Opportunities for Improvement and Barriers to Progress

As with oil production, the lifeblood of a refinery is the production system. Failure in any processing vessel,
particularly the major feedstock lines, costs significantly more in lost production than the cost of prevention and
maintenance. Unlike oil and gas production, refining margins are dictated on both ends by commodity prices since
the input feedstock crude oil is purchased at the market price and the output product is sold at each individual
commodity price.

Because the economics of refining are wholly dependent on world market prices, the amount spent on
corrosion control is dictated by current economic conditions in the industry. Since 1981, the number of operating
refineries in the United States has dropped from 324 to 163. The industry has seen a trend toward refining more
highly acidic oils (which can be refined at a higher margin) since the early 1990s, which increases potential
corrosion problems, but may extend the economic life of some existing refineries.

Recommendations and Implementation Strategy

The majority of pipelines and vessels in refineries are constructed of carbon steel. Opportunities for significant
savings exist through the use of low-alloy steels and alloy-clad vessels, particularly as increasingly higher fractions
of acidic crude are refined.


1
CC Technologies Laboratories, Inc., Dublin, Ohio.
2
Saudi Arabian Oil Company (Saudi ARAMCO), Dhahran, Saudi Arabia.
Appendix U Petroleum Refining



Uiv
Increasing regulation and pressure from environmental groups have essentially forced the refiners to
implement defensive strategies. This is compounded by overseas market forces such as the Organization of
Petroleum Exporting Countries (OPEC), which can control the price of feedstock crude oil, making long-term
planning difficult. In a commodity price-driven industry that is struggling to compete in the world market,
investment in more effective corrosion control strategies often takes a backseat to across-the-board cost-cutting
measures.

Summary of Issues

Increase consciousness of corrosion
costs and potential savings.
Federal regulations such as the Clean Air Act of 1990 have increased
operating costs due to stricter controls on releases. In addition, more
acidic crude oil is being refined because of the higher net margins
possible; a stronger approach to corrosion control will enable these more
aggressive crudes to be safely refined in the United States, otherwise, the
refining industry will continue to move overseas.
Change perception that nothing can
be done about corrosion.
A longer-term vision must be incorporated into facility design and
maintenance to enable U.S. refiners to remain competitive. This includes
the use of some exotic materials, such as ceramics, which can provide a
longer service life in high-temperature operations.
Advance design practices for better
corrosion management.
More efficient processing vessel design would reduce the carryover of
corrosives from one process to the next. Improved water separation, CO
2

stripping, etc. would help isolate the problem areas and would allow
corrosion control efforts to be focused farther upstream.
Change technical practices to
realize corrosion cost-savings.
Fitness-for-service principles will need to be applied to vessel inspections
rather than following existing protocol, which may be inadequate. Risk-
based models would enable the maintenance staff to prioritize inspections.
Change policies and management
practices to realize corrosion
cost-savings.
Management may have to shift its focus from ensuring compliance with
existing regulations to a more active strategy to prevent releases. Zero-
leak policies and programs would be implemented in plants to emphasize
commitment to this strategy.
Advance life prediction and
performance assessment methods.
Flexible life prediction models are needed that can show how a change in
the feedstock crude affects all vessels downstream. Also needed are
improved inspection and monitoring techniques for in-plant piping
systems, both for aboveground and buried lines.
Advance technology (research,
development, and implementation).
Processes in refineries are largely computer-controlled, but corrosion
control methods lag behind in technology. Computer-aided mitigation
systems, perhaps integrated with existing process control modules, could
be used to track the changing corrosivity of existing processes.
Improve education and training for
corrosion control.
Requiring contract services such as nondestructive inspection companies,
maintenance painters, and corrosion control specialists to provide NACE-
certified personnel or at least personnel who meet some minimum
training/education requirements before they are allowed to work on-site
would improve the level of knowledge in the industry.

Appendix U Petroleum Refining



Uv
TABLE OF CONTENTS
SECTOR DESCRIPTION.........................................................................................................................................U1
REFINING CAPACITY OF THE UNITED STATES..........................................................................................U1
Refined Products ..........................................................................................................................................U2
Types of Crude Oil .......................................................................................................................................U3
Elements of the Refining Operation.............................................................................................................U4
AREAS OF MAJOR CORROSION IMPACT.......................................................................................................U6
Water-Related Side Corrosion......................................................................................................................U6
Processing-Related Corrosion ......................................................................................................................U6
Naphthenic Acid Corrosion..........................................................................................................................U7
Sulfur............................................................................................................................................................U7
CORROSION CONTROL METHODS...................................................................................................................U8
Materials in Refinery Construction ..............................................................................................................U8
Carbon Steel...................................................................................................................................U9
Austenitic Stainless Steel ...............................................................................................................U9
Ferritic and Martensitic Steels .....................................................................................................U10
Other Alloys.................................................................................................................................U10
CORROSION MANAGEMENT ............................................................................................................................U10
Economics of Refining...............................................................................................................................U10
Capital Expenditures ..................................................................................................................................U11
Operational Expenditures ...........................................................................................................................U12
Fouling .......................................................................................................................................................U13
Acidic Crude Oils.......................................................................................................................................U14
Failure Costs...............................................................................................................................................U15
CASE STUDY.........................................................................................................................................................U15
Corrosion-Related Failure in Refinery .......................................................................................................U15
REFERENCES.........................................................................................................................................................U16




LIST OF FIGURES
Figure 1. Past and predicted future refining capacity in the United States....................................................U1
Figure 2. 1996 Outputs from refineries by end-product usage ......................................................................U3
Figure 3. Flowchart diagram of a typical refining process ............................................................................U5
Figure 4. Margins of U.S. refiners since 1977.............................................................................................U11
Figure 5. Incremental costs for corrosion control of carbon steel distillation column ................................U14
Figure 6. Stress corrosion cracking near a weld..........................................................................................U15


Appendix U Petroleum Refining



Uvi
LIST OF TABLES
Table 1. U.S. daily average supply and disposition of crude oil and petroleum products, January 1997 ....U2
Table 2. Typical approximate characteristics and properties and gasoline potential of various crudes .......U4
Table 3. Comparison of the relative costs of various alloys.........................................................................U9
Table 4. Environmental costs at a refinery.................................................................................................U12





Appendix U Petroleum Refining



U1
SECTOR DESCRIPTION

Petroleum is the single largest source of energy for the United States. When measured in British thermal units,
the nation uses twice as much petroleum than either coal or natural gas, and four times more petroleum than nuclear
power, hydroelectricity, and other renewable energy sources. On average, every citizen in the United States
consumes 9.1 kg (20 lb) of petroleum per day. This primary dependence on petroleum for energy has been a reality
for decades, with petroleum's share of the domestic energy mix peaking at 49 percent in 1977.


REFINING CAPACITY OF THE UNITED STATES

U.S. refineries represent approximately 23 percent of world production. The United States has the largest
refining capacity in the world, with 163 operating refineries, having declined from a high of 324 refineries in 1981
and 205 refineries in 1990.
(1)


Most refineries in the United States are concentrated on the west and gulf coasts, primarily due to access to
major sea transportation and shipping routes. The majority of the oil distillation capacity is currently centered in
large, integrated companies with multiple refining facilities. About 25 percent of all facilities are small operations
producing fewer than 50,000 barrels per day, representing 5 percent of the total output of petroleum products
annually.

In 1970, U.S. refineries supplied just under 15 million barrels of refined product per day. In 1996, U.S.
refiners supplied more than 18 million barrels per day of refined petroleum products. Total daily crude oil refining
capacity by the end of 1999 was 16,511,871 barrels per day. U.S. refiners rely on both domestic and foreign
producers for crude oil. Historical trends over the last 10 years indicate that imports of crude oil have been rising
steadily.

Future refining capacity in the United States is predicted to increase slightly and level off in the next 20 years,
as shown in figure 1. The curve illustrates how the United States experienced a steep decline in refining capacity in
the years following 1981. Between 1981 and 1989, the number of U.S. refineries fell from 324 to 204, representing
a loss of 3 million barrels per day (MMBD) in operable capacity, and a concomitant increase in refining capacity
utilization from 69 to 86 percent.




Figure 1. Past and predicted future refining capacity in the United States.
(2)

M
i
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l
i
o
n
s

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f

b
a
r
r
e
l
s

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e
r

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a
y

Appendix U Petroleum Refining



U2
Refined Products

Table 1 shows the average daily throughput of U.S. refineries in 1997.
(3)
On an annual basis, this translates
into a total of 5.7 billion barrels
3
of refined product. Approximately 90 percent of all crude oil entering a petroleum
refinery is converted to fuel products, with the remaining 10 percent divided into non-fuel products such as asphalt,
lubricants, and waxes and petrochemicals such as polymer feedstocks and industrial solvents. Gasoline production
alone accounts for more than 46 percent of all production, as shown in figure 2.

Table 1. U.S. daily average supply and disposition of crude oil and petroleum products, January 1997.
(3)


COMMODITY
FIELD
PRODUCTION
(thousand barrels per day)
REFINERY
PRODUCTION
(thousand barrels per day)
UNACCOUNTED-FOR
IMPORTS
(thousand barrels per day)
Crude Oil 6,402 7,492

NGLs and LRGs* 1,782 528 246
Pentanes Plus 302 53
LPGs** 1,480 528 193
Ethane/Ethylene 634 26
Propane/Propylene 520 519
N Butane/Butylene 165 -28
161 11
OTHER LIQUIDS 267 740
Other Hydrocarbons/Oxy 247 77
Ounfinished Oils 421
Mogas Blend. Comp.*** 242
Avgas Blend. Comp.**** 20

FINISHED PETRO PROD. 19 15,075 1,285
Finished Mogas 19 7,288 320
Reformulated 2,217 136
Oxygenated 134 0
Other 4,937 184

Finished Avgas 16 0
Jet Fuel 1,491 100
Naptha-Type 0
Kerosene-Type 1,491 100
Kerosene 118 3
Distilate Fuel Oil 3,119 293
0.05 Sulfur 1,751 94
>0.05 Sulfur 1,368 198
Residual Fuel Oil 801 211
Naptha Petro Feed 180 106
Oth Oils Petro Feed 240 206
Special Napthas 47 10
Lubricants 168 7
Waxes 21 1


3
1 barrel = 158 L.
Appendix U Petroleum Refining



U3
Table 1. U.S. daily average supply and disposition of crude oil and petroleum products, January 1997 (continued).
(3)

COMMODITY
FIELD
PRODUCTION
(thousand barrels per day)
REFINERY
PRODUCTION
(thousand barrels per day)
UNACCOUNTED-FOR
IMPORTS
(thousand barrels per day)
Petroleum Cake 638 2
Asphalt & Road Oil 322 26
Still Gas 585
Misc. Products 41
TOTAL 8,470 15,603 9,763
*Natural Gas Liquids and Lead Replacement Gasolines
**Liquefied Petroleum Gas
***Motor Vehicle Fuel
****Aviation Fuel


Gasoline
46.5%
Fuel Oils
25.0%
Other Products
14.8%
Other Fuels
13.7%


Figure 2. 1996 Outputs from refineries by end-product usage.


Types of Crude Oil

Crude oils are complex mixtures containing many different hydrocarbon compounds that vary in appearance
and composition from one oil field to another. Crude oils range in consistency from water to tar-like solids, and in
color from clear to black. An average crude oil contains about 84 percent carbon, 14 percent hydrogen, 1 to
3 percent sulfur, and less than 1 percent each of nitrogen, oxygen, metals, and salts. Crude oils are generally
classified as paraffinic, naphthenic, or aromatic based on the predominant proportion of similar hydrocarbon
molecules. Mixed-base crudes have varying amounts of each type of hydrocarbon. Refinery crude base stocks
usually consist of mixtures of two or more different crude oils. Table 2 lists some typical properties for crude oil
sources from around the world.
Appendix U Petroleum Refining



U4
Crude oils are also defined in terms of API (American Petroleum Institute) gravity number. The higher the
API gravity number, the lighter the crude. For example, light crude oils have high API gravities and low specific
gravities. Crude oils with low carbon, high hydrogen, and high API gravity are usually rich in paraffins and tend to
yield greater proportions of gasoline and light petroleum products. Crude oils with high carbon, low hydrogen, and
low API gravities are usually rich in aromatics. Crude oils that contain appreciable quantities of hydrogen sulfide or
other reactive sulfur compounds are called sour. Those with less sulfur are called sweet. Some exceptions to this
rule are the West Texas crudes, which are always considered sour regardless of their H
2
S content, and the Arabian
high-sulfur crudes, which are not considered sour because their sulfur compounds are not highly reactive.

For refining operations, the acidity of the crude oil is an important consideration for economic reasons. A
number of organic acids may be present in crude oil feedstocks. The extra costs associated with handling high-acid
crudes can be offset by a lower feedstock cost. Acidity is defined in terms of the total acid number (TAN), which is
a measure of the number of milligrams of potassium hydroxide (KOH) needed to neutralize 1 g of sample. A TAN
exceeding 1.5 to 1.8 mg KOH/g is considered corrosive; however, corrosion problems can occur in crudes with
TAN numbers as low as 0.3 for several reasons, including velocity and the nature of the acidic species present.


Table 2. Typical approximate characteristics and properties and gasoline potential of various crudes.
(4)


CRUDE
SOURCE
PARRAFINS
(%VOL)
AROMATICS
(%VOL)
NAPTHENES
(%VOL)
SULFUR
(%WT)
API
GRAVITY
(APPROX.)
NAPH. YIELD
(% VOL)
OCTANE
NUMBER
(TYPICAL)
Nigerian
(light)
37 9 54 0.2 36 28 60
Saudi (light) 63 19 18 2 34 22 40
Saudi (heavy) 60 15 25 2.1 28 23 35
Venezuela
(heavy)
35 12 53 2.3 30 2 60
Venezuela
(light)
52 14 34 1.5 24 18 50
USA
Midcont.
Sweet
- - - 0.4 40 - -
USA
(W.Texas
Sour)
46 22 32 1.9 32 33 55
North Sea
(Brent)
50 16 34 0.4 37 31 50


Elements of the Refining Operation

Petroleum refining begins with the desalting (dehydration) of feedstock followed by distillation, or
fractionation, of crude oils into separate hydrocarbon groups. The resultant products are directly related to the
characteristics of the crude oil processed. Most distillation products are further converted into more usable products
by changing the size and structure of the hydrocarbon molecules through cracking, reforming, and other conversion
processes as discussed in this sector. These converted products are then subjected to various treatment and
separation processes, such as extraction, hydrotreating, and sweetening to remove undesirable constituents and
improve product quality. Integrated refineries incorporate fractionation, conversion, treatment, and blending
operations, and may also include petrochemical processing. An outline of the refining process is shown in figure 3.
Appendix U Petroleum Refining



U5


Figure 3. Flowchart diagram of a typical refining process.
(5)



Crude oil often contains water, inorganic salts, suspended solids, and water-soluble trace metals. As a first step
in the refining process, to reduce corrosion, plugging, and fouling of equipment and to prevent poisoning the
catalysts in processing units, these contaminants must be removed by desalting (dehydration). The two most typical
methods of crude oil desalting chemical and electrostatic separation use hot water as the extraction agent. In
chemical desalting, water and chemical surfactants (demulsifiers) are added to the crude and heated so that salts and
other impurities dissolve into the water or attach to the water, and are then held in a tank where they settle out.
Electrical desalting is the application of high-voltage electrostatic charges to concentrate-suspended water globules
in the bottom of the settling tank. Surfactants are added only when the crude has a large amount of suspended
solids. Both methods of desalting are continuous. A third and less common process involves filtering heated crude
using diatomaceous earth.

After desalting, crude oil is continuously drawn from the top of the settling tanks and sent to the crude
distillation (fractionating) tower. Fractionation (distillation) is the separation of crude oil in atmospheric and
vacuum distillation towers into groups of hydrocarbon compounds of differing boiling-point ranges called fractions
or cuts.

Appendix U Petroleum Refining



U6
Conversion processes change the size and/or structure of hydrocarbon molecules. These processes include
decomposition (dividing) by thermal and catalytic cracking, unification (combining) through alkylation and
polymerization, and alteration (rearranging) with isomerization and catalytic reforming.

Treatment processes are intended to prepare hydrocarbon streams for additional processing and to prepare
finished products. Treatment may include the removal or separation of aromatics and naphthenes, as well as
impurities and undesirable contaminants. Treatment may involve chemical or physical separation such as
dissolving, absorption, or precipitation using a variety and combination of processes, including desalting, drying,
hydrodesulfurizing, solvent refining, sweetening, solvent extraction, and solvent dewaxing.

Formulating and blending is the process of mixing and combining hydrocarbon fractions, additives, and other
components to produce finished products with specific performance properties.

Other refinery operations include light-end recovery, sour-water stripping, solid waste and wastewater
treatment, process-water treatment and cooling, storage and handling, product movement, hydrogen production, acid
and tail-gas treatment, and sulfur recovery. Auxiliary operations and facilities include steam and power generation;
process and fire water systems; flares and relief systems; furnaces and heaters; pumps and valves; supply of steam,
air, nitrogen, and other plant gases; alarms and sensors; noise and pollution controls; sampling, testing, and
inspecting; and laboratory, control room, maintenance, and administrative facilities.


AREAS OF MAJOR CORROSION IMPACT

A refinery operation may have in excess of 3,000 processing vessels of varying size, shape, form, and function.
In addition, a typical refinery has about 3,200 km (2,000 mi) of pipeline, much of which is inaccessible. Some of
these pipelines are horizontal; some are vertical; some are up to 61 m (200 ft) high; and some are buried under
cement, soil, mud, and water. The diameters range from 10 cm (4 in) up to 76 cm (30 in).

Water-Related Corrosion

Crude oil desalting and distillation generates considerable wastewater. Typical wastewater flow from a
desalter is approximately 8 L (2.1 gal) of water per barrel of oil processed. This water contains accelerative
corrosive components such as H
2
S, CO
2
, chlorides, and high levels of dissolved solids. The wastewater also
contains a fraction of crude oil, which may be recovered during the water treatment process.

In addition to generated wastewater, cooling water (either fresh water or saltwater) is used extensively in
refining operations. The corrosivity of the cooling water varies greatly depending on the process, so it is difficult to
describe typical cooling water problems; however, corrosivity is highly dependent upon the level and type of
dissolved solids and gases in the cooling water, including chlorides, oxygen, dissolved gases, and microbes.
Cooling water temperature can also affect corrosivity.

Processing-Related Corrosion

The top section of a crude unit can be subjected to a multitude of corrosive species. Hydrochloric acid, formed
from the hydrolysis of calcium and magnesium chlorides, is the principal strong acid responsible for corrosion in the
crude unit top section. Carbon dioxide is released from crudes typically produced in CO
2
-flooded fields and crudes
that contain a high content of naphthenic acid.

Low molecular fatty acids such as formic, acetic, propionic, and butanoic acids are released from crudes with a
high content of naphthenic acid. Hydrogen sulfide, released from sour crudes, significantly increases corrosion of
Appendix U Petroleum Refining



U7
the crude unit top section. Sulfuric and sulfurous acids, formed by either oxidation of H
2
S or direct condensation of
SO
2
and SO
3
, also increase corrosion.

Mitigation of this type of corrosion is performed by process changes, material upgrading, design changes, and
injection of chemicals such as neutralizers and corrosion inhibitors. Process changes include any action to remove
or at least reduce the amount of acid gas present and to prevent accumulation of water on the tower trays. Material
upgrading includes lining of distillation tower tops with alloys resistant to hydrochloric acid. Design changes are
used to prevent the accumulation of water. They include coalescers and water draws. The application of chemicals
includes the injection of a neutralizer to increase the pH and a corrosion inhibitor. The presence of many weak
acids, such as fatty acids and CO
2
, can buffer the environment and require greater use of neutralizers. Excess
neutralizers may cause plugging of trays and corrosion under the salt deposits.

A dew-point probe is typically placed in a location at least 38 C (100 F) above the calculated dew-point
temperature. The probe elements are then cooled internally by cold-air injection and the temperature at which the
first liquid drop forms is determined for the actual conditions in the tower. The injection point and the amount of
chemicals used depend on the knowledge of the temperature in the tower where condensation starts. With the
number of corrosive species present, the calculated dew point may be much lower than the actual dew point.

Naphthenic Acid Corrosion

High-temperature crude corrosivity of distillation units is a major concern of the refining industry. The
presence of naphthenic acid and sulfur compounds considerably increases corrosion in the high temperature parts of
the distillation units and, therefore, equipment failures have become a critical safety and reliability issue.
Naphthenic acid is the generic name used for all of the organic acids present in crude oils. Most of these acids are
believed to have the chemical formula R(CH
2
)nCOOH, where R is a cyclopentane ring and n is typically greater
than 12. In addition to R(CH
2
)nCOOH, a multitude of other acidic organic compounds are also present; however,
not all of them have been analyzed to date.

Isolated deep pits in partially passivated areas and/or impingement attack in essentially passivation-free areas
are typical of naphthenic acid corrosion (NAC). Damage is in the form of unexpected high corrosion rates on alloys
that would normally be expected to resist sulfidic corrosion. In many cases, even very highly alloyed materials (i.e.,
12 Cr, AISI types 316 and 317) have been found to exhibit sensitivity to corrosion under these conditions. NAC is
differentiated from sulfidic corrosion by the nature of the corrosion (pitting and impingement) and by its severe
attack at high velocities in crude distillation units. Crude feedstock heaters, furnaces, transfer lines, feed and reflux
sections of columns, atmospheric and vacuum columns, heat exchangers, and condensers are among the types of
equipment subject to this type of corrosion.

Sulfur

Other than carbon and hydrogen, sulfur is the most abundant element in petroleum. It may be present as
elemental sulfur, hydrogen sulfide, mercaptans, sulfides, and polysulfides. Sulfur at a level of 0.2 percent and
greater is known to be corrosive to carbon and low-alloy steels at temperatures from 230 C (450 F) to 455 C
(850 F).

At high temperatures, especially in furnaces and transfer lines, the presence of naphthenic acids may increase
the severity of sulfidic corrosion. The presence of these organic acids may disrupt the sulfide film, thereby
promoting sulfidic corrosion on alloys that would normally be expected to resist this form of attack (i.e., 12 Cr and
higher alloys). In some cases, such as in side-cut piping, the sulfide film produced by H
2
S is believed to offer some
degree of protection from naphthenic acid corrosion.

In general, the corrosion rate of all alloys in the distillation units increases with an increase in temperature.
Naphthenic acid corrosion occurs primarily in high-velocity areas of crude distillation units in the 220 C to 400 C
Appendix U Petroleum Refining



U8
(430 F to 750 F) temperature range. No corrosion damage is usually found at temperatures greater than 400 C
(750 F), probably due to the decomposition of naphthenic acids or protection from the coke formed at the metal
surface.

Velocity and, more importantly, wall shear stress are the main parameters affecting NAC. Fluid flow velocity
lacks predictive capabilities. Data related to fluid flow parameters, such as wall shear stress and the Reynolds
Number, are more accurate because the density and viscosity of liquid and vapor in the pipe, the degree of
vaporization in the pipe, and the pipe diameter are also taken into account. Corrosion rates are directly proportional
to shear stress. Typically, the higher the acid content, the greater the sensitivity to velocity. When combined with
high temperature and high velocity, even very low levels of naphthenic acid may result in very high corrosion rates.


CORROSION CONTROL METHODS

High-temperature crude corrosion is a complex problem. There are at least three corrosion mechanisms:

1. furnace tubes and transfer lines where corrosion is dependent on velocity and vaporization,
and is accelerated by naphthenic acid,
2. vacuum column where corrosion occurs at the condensing temperature, is independent of
velocity, and increases with naphthenic acid concentration, and
3. side-cut piping where corrosion is dependent on naphthenic acid content and is inhibited
somewhat by sulfur compounds.

Mitigation of process corrosion includes blending, inhibition, materials upgrading, and process control.

Blending may be used to reduce the naphthenic acid content of the feed, thereby reducing corrosion to an
acceptable level. Blending of heavy and light crudes can change shear stress parameters and might also help reduce
corrosion. Blending is also used to increase the level of sulfur content in the feed and inhibit, to some degree,
naphthenic acid corrosion.

Injection of corrosion inhibitors may provide protection for specific fractions that are known to be particularly
severe. Monitoring needs to be adequate in this case to check on the effectiveness of the treatment. Process control
changes may provide adequate corrosion control if there is the possibility of reducing charge rate and temperature.

For long-term reliability, upgrading the construction materials is the best solution. Above 288 C (550 F),
with very low naphthenic acid content, cladding with chromium (Cr) steels (5 to 12 percent Cr) is recommended for
crudes of greater than 1 percent sulfur when no operating experience is available. When hydrogen sulfide is
evolved, an alloy containing a minimum of 9 percent chromium is preferred. In contrast to high-temperature sulfidic
corrosion, low-alloy steels containing up to 12 percent Cr do not seem to provide benefits over carbon steel in
naphthenic acid service. Type 316 stainless steel [greater than 2.5 percent molybdenum (Mo)] or Type 317 stainless
steel (greater than 3.5 percent Mo) is often recommended for cladding of vacuum and atmospheric columns.

Materials in Refinery Construction

The selection of materials for refinery construction depends on the type of refinery, the type of crude oil
handled, and the expected service life for each vessel.
(6)
As with all materials selection, the life-cycle cost must be
considered in addition to purchase price. Table 3 lists some common alloys and their material costs relative to
carbon steel.



Appendix U Petroleum Refining



U9
Table 3. Comparison of the relative costs of various alloys.
(7)


CONSTITUENTS
ALLOY CLASS EXAMPLE
Ni Cr Mo Fe Co Ti Cu Cb Al V
COST
RATIO
(9)

Carbon Steel C10 > 94 0.2
Low-Alloy Steel 1-1/4Cr 1/2Mo 1.25 0.5 balance 0.25
Type 316L 13.0 17.0 2.3 balance 1.0
Alloy 800H 32.5 21.0 4.6 - Fe-Ni-Cr + Mo
20Cb-3 35.0 20.0 2.5 balance 3.5 3.8
Alloy C2 54.0 15.5 16.0
Alloy C276 57.0 16.0 16.0 5.5
Alloy C4 54.0 16.0 15.5 3.0
6.0
Ni-Cr-Mo
Alloy 625 60.0 21.5 9.0 3.7 6.3
Alloy G 45.0 22.2 6.5 19.5 2.0 6.4
Ni-Cr-Fe
Alloy 600 76.0 15.0 8.0 -
Ni-Mo Alloy B2 balance 1.0 28.0 2.0 1.0 11.6
Ni-Cu Alloy 400 65.1 32.0 -
Nickel Alloy 200 99.9 -
Co-Base ULTIMET (R) 9.0 26.0 5.0 3.0 54.0 27.2
Ti-Base Ti-6Al-4V 90 6.0 4.0 -


Carbon Steel

Carbon steel is by far the most common structural material in refineries due primarily to a combination of
strength, availability, relatively low cost, and a resistance to fire. The low-alloy steels are specified for applications
that require higher properties than can be obtained with carbon steels. The workhorse refinery alloys for elevated
temperature service greater than 260
o
C (500
o
F) contain 0.5 to 9.0 percent

chromium plus molybdenum. Normally,
at least 5 percent chromium is required to resist oxidation at temperatures in excess of 430
o
C (800
o
F). Currently,
most refineries use 9Cr-1 Mo tubes in coker heaters. For carbon steel and low-alloy steel, creep becomes a design
consideration at about 430
o
C (800
o
F) and 480
o
C (900
o
F), respectively. These alloys are used for pressure vessels,
piping, exchangers, and heater tubes.

Austenitic Stainless Steel

The austenitic structure provides a combination of excellent corrosion, oxidation, and sulfidation resistance
with high creep resistance, toughness, and strength at temperatures greater than 565
o
C (1050
o
F). They are,
therefore, often used in refineries for heater tubes and heater tube supports, and in amine, fluid catalytic cracking
(FCC), catalytic hydro-desulfurization (CHD) sulfur, and hydrogen plants.

They are susceptible, however, to grain boundary chromium carbide precipitation sensitization when heated
in the range of 540
o
C (1000
o
F) to 820
o
C (1500
o
F). Where sensitization is to be avoided, refineries prefer to use
the stabilized grades of Type 347 (with Cb) or Type 321 (with Ti).

The susceptibility of the austenitic stainless steels to stress corrosion cracking limits their use and requires
special precautions during operation and at downtime. At downtime, the precautions taken to prevent stress
corrosion cracking are either alkaline washing with a dilute soda ash and low-chloride water solutions and/or
nitrogen blanketing. The austenitic stainless steels are used for corrosion resistance or resistance to
Appendix U Petroleum Refining



U10
high-temperature hydrogen or sulfide damage. Solid stainless steel vessels are rarely constructed. Strip-lined,
stainless-clad, or lined vessels are found in hydrocracking and hydrotreating services. Austenitic stainless steels also
find service as tubing in heat exchangers exposed to corrosive conditions.

Ferritic and Martensitic Steels

Other chromium-iron stainless steels with little or no nickel form crystallographic structures different from
austenitic. This stainless steel alloy contains less than 0.10 percent C, 11 to 13 percent Cr, balance Fe, and a ferritic
structure. When the ferritic stainless alloys are modified, they may be hardened and become what is called
"martensitic" by heat treatment. The ferritic and martensitic stainless steels are classified by the American Iron and
Steel Institute (AISI) as the 400 series. The most common alloys from this series found in refineries are types 410,
410S, 405, and 430 stainless steels. A common stainless steel for trays and lining in crude service is Type 410
stainless steel.

Other Alloys

The principal non-ferrous alloys in refinery processing equipment are the copper-based and copper-nickel
alloys; however, the use of copper-based alloys in NH
3
or NH
4
environments should be avoided.

Although admiralty brass was the original saltwater condenser tube material, it was found to be susceptible to
erosion-corrosion, particularly at tube ends. Aluminum brass, containing 2 percent aluminum, was found to be
somewhat more resistant to erosion in saltwater. Inhibition with arsenic is necessary to prevent de-zincification, as
in the case of admiralty brass. The stronger naval brass is often selected as the tube sheet material when admiralty
brass tubes are used in condensers. Generally, a bronze is a tin alloy of copper, although the term has been widely
used for other alloys, including some brasses. Cast brass or bronze alloys for valves and fittings are usually copper-
tin-zinc compositions, plus lead for machinability. Aluminum bronzes are often used as tube sheet and channel
material for exchangers with admiralty brass or titanium tubes exposed to cooling water.

The 70/30 copper-nickel alloy is used for exchanger tubes when better saltwater corrosion resistance than in
aluminum brass is needed, or when high metal temperatures in water-cooled exchangers may cause de-zincification
in brass. Monel is a nickel-copper alloy with 67 percent nickel and 30 percent copper. Monel has very good
resistance to saltwater and, under non-oxidizing conditions, to acids such as hydrochloric and hydrofluoric acids.
Monel has a better high-temperature resistance to cooling water than does 70/30 copper-nickel. Monel cladding and
Monel trays are commonly specified at the top of crude towers to resist HCl vapor and where the temperature is
below 205
o
C (400
o
F). Over 205
o
C (400
o
F), nickel-based alloys are attacked by H
2
S. For high temperature
strength and/or corrosion resistance, several nickel-based alloys are used for special applications such as expansion
bellows in FCC process units (Alloy 625), stems in flue gas butterfly valves (Alloy X 750), and in springs exposed
to high-temperature corrosives (Alloy X).

Titanium has excellent resistance to seawater, and it is also used for tubing in crude tower overhead
condensers. Overall, the use of titanium is extremely limited due to the high cost and the availability of suitable,
more economic alternatives.


CORROSION MANAGEMENT

Economics of Refining

Although the individual components are quite complicated, the large-scale economics of refining operations
can be defined in simple terms. Gross margin is the difference between the output of a refinery (refined products)
and the cost of the feedstock (crude oil and other chemicals). The net margin is the gross margin minus the
operating costs. Figure 4 illustrates the last 20 years of margins in the refinery industry.
Appendix U Petroleum Refining



U11


Figure 4. Margins of U.S. refiners since 1977.
(8)



Capital Expenditures

The capital intensity of a process refers to the amount of capital needed to produce a unit of product. For U.S.
refining operations, capital intensity is measured by the ratio of net property, plant, and equipment (i.e., the balance
sheet value of productive long-term assets adjusted for depreciation) to refinery capacity (barrels per calendar day of
crude distillation capacity). Adjusted for general inflation (via the implicit gross domestic product deflator), the
refiners capital expenditures for U.S. refining doubled from 1989 to 1992.

A surge in capital expenditures occurred in the late 1970s through the early 1980s. During this period, the
major U.S. companies upgraded their refineries to process heavier, more sulfurous crude oil inputs into relatively
greater proportions of lighter products, particularly gasoline. These investments were largely premised on wide
price spreads between higher and lower quality crude oils and lighter and heavier refined products.

The decline in the price spread between differing qualities of crude oils in the 1990s contributed to the overall
deterioration in the gross margin evidenced in figure 4. The price decline between crude oils of differing qualities
was especially adverse for refiners who invested heavily in refinery upgrades to yield higher proportions of light
products. The refiners directed much of the surge in their refining investments in the late 1970s to the early 1980s
toward increasing their capability to process heavier, more sulfurous crude oils. For example, the capacity for
increased processing of heavy sour crude inputs, relative to basic crude distillation capacity, rose from 22 percent in
1974 to 30 percent in 1980 to 47 percent in 1993.

Unlike the earlier surge in refinery investments, the upswing in capital expenditures in the 1990s appeared to
be largely driven by increased expenditures for pollution abatement.
(8)
In particular, the Clean Air Act Amendments
of 1990 required production of oxygenated gasolines by late 1992, lower sulfur diesel fuels by late 1993, and
reformulated gasoline by January 1, 1995. The share of total U.S. refining capital expenditures for pollution
abatement increased from slightly more than 10 percent shortly before the Clean Air Act Amendments of 1990 to
more than 40 percent in recent years.

Although pollution abatement requirements clearly reduced the rate of return to refining/marketing assets,
these requirements appear to account for only a small part of the steep decline in the rate of return to U.S.
Appendix U Petroleum Refining



U12
refining/marketing operations in the 1990s. The increase in pollution abatement operating costs over this period was
$0.07 per barrel of refined products sold, or 5 percent of the $1.52 per barrel decline in the net margin.

The cost of extra capital expenditures for corrosion control can be included in the operational expenditures for
refinery operations. If an operator chooses a corrosion-resistant alloy vessel for a refinery operation, then the extra
annual cost of this vessel amortized over the life of the vessel is included in the operational expenditures. If an
operator chooses carbon steel for the vessel, then the cost of corrosion control measures, such as anodes, chemical
treatment, and monitoring, are the only measurable capital expenditures, but annual costs of upkeep will greatly
increase operational expenditures. Economic justifications for such expenditures based on life-cycle costs continue
to be part of corrosion control decisions for refinery operations.

Operational Expenditures

The operating costs of refineries have steadily decreased in recent years due to technological advances and
improvements in efficiency. The 1996 operating costs were an average of $5.51 per barrel (bbl).
(9)


It should be noted that direct costs for corrosion prevention and mitigation are extremely difficult to obtain, as
these are kept very close to the vest by the refining industry. While the reasons for this are unclear, it can be
assumed that the intense scrutiny that the entire petrochemical industry undergoes by environmental regulators and
community watchdogs has created a situation in which refiners prefer not to divulge the magnitude of their corrosion
problems. Thus, information for this sector has been gathered from a combination of some published surveys and
government sources.

One particular study
(10)
focused on operating costs at a single small refinery (53,000 barrels/day), concentrating
on the costs related to environmental protection. This project quantified air emissions, water discharges, and other
wastes generated at the facility. Moreover, it identified a range of options to reduce or prevent those releases, some
of which appeared more cost-effective than those required by existing rules.

At most refineries, operating costs are dominated by crude oil. Even small fluctuations in the price of crude oil
can overshadow other operating costs of the refinery. As a result, it is customary at the refinery level to track
"non-crude operating costs," excluding the cost of feedstock. The non-crude operating costs of this refinery are
shown in table 4.


Table 4. Environmental costs at a refinery.

ENVIRONMENTAL COST
CATEGORY
PERCENTAGE OF 1992
NON-CRUDE OPERATING
COSTS
Waste Treatment 4.9
Maintenance 3.3
Product Requirements 2.7
Depreciation 2.5
Administration, Compliance 2.4
Sulphur Recovery 1.1
Waste Disposal 0.7
Non-Recurring Costs 4.0
TOTAL 21.6%


Appendix U Petroleum Refining



U13
The analysis estimates that total environmentally related costs are 21.6 percent of total non-crude operating
costs. This total focuses primarily on capital, operating, and maintenance costs, and excludes contingent liability
costs. If these costs were added, the total could be higher. Remediation expenses are recorded as "non-recurring
costs."

At the outset of the project, prior to conducting the analysis, environmental personnel informally estimated
environmentally related costs at only 3 percent of the total non-crude operating costs. The magnitude of this
difference, as well as the magnitude of the costs, indicates the value of identifying and tracking environmental costs.

Maintenance costs (40 percent of which can be attributed to corrosion control) were estimated in the study
(10)

to be 3.3 percent (rounded to 3 percent) of the non-crude operating costs (table 4). When scaling up to all processes,
this figure becomes:

0.03 fraction maintenance costs / 0.216 fraction environmental operating costs = 13.9% of
the total operating costs due to maintenance

$5.51/bbl operating costs
(9)
x 13.9% = $0.76/bbl maintenance costs

$0.76/bbl maintenance costs x 40% due to corrosion control = $0.31/bbl operating costs for
corrosion control

When multiplied by the annual refinery output in the United States (5.7 billion barrels in 1997), the total cost
of corrosion is ($0.31 x 5.7 billion = ) $1.767 billion per year.

Vessel turnarounds, during which a processing vessel is emptied, inspected, repaired (if necessary), and put
back into service, are mandatory in most cases due to U.S. Department of Transportation (DOT) regulations,
primarily due to suspected corrosion damage inside the vessels. The costs for these operations are capitalized rather
than included in the maintenance budget.

One refiner estimated the total cost of the turnarounds at one of their refineries (a 260,000-bbl per day plant).
(4)

For the 3,000 processing vessels in this refinery, the total cost of turnarounds (5-year intervals for each individual
vessel) was $118 million. Therefore, turnaround costs per barrel are:

($118,000,000/yr x 1 turnaround/5 years) / (260,000 bbl/day x 365 days/yr) = $0.25/bbl

$0.25/bbl x 5.7 billion bbl/yr = $1.425 billion/yr for turnaround costs

It should be noted that the trend in this activity is to move toward risk-based inspections and longer intervals
(10 to 20 years) between turnarounds, which would significantly reduce the cost of corrosion maintenance, but
increase the risk factor dramatically. The validity of this strategy is yet to be determined since the number of
incidents with vessels outside the standard 5-year window will, in the future, help to define the proper risk
assessment.

Fouling

In addition to mitigation and maintenance costs, the component of lost production due to corrosion and related
problems must be considered. Fouling is the leading cause of diminished efficiency and productivity in refineries.
Fouling is a deposit buildup in refinery processes that impedes heat transfer and/or reduces throughput. The energy
lost due to this inefficiency must be supplied by burning additional fuel or reducing feed.

It is estimated that the cost penalty of fouling is in excess of $2 billion annually.
(11)
While most fouling is
caused by the deposition of heavier hydrocarbon species coming directly from the crude oil, a small undetermined
percentage is related to corrosion and scale deposits, either actively participating as loose corrosion products or by
scale acting as a substrate for hydrocarbon deposition.
Appendix U Petroleum Refining



U14
It is not known exactly how much fouling is related to corrosion versus that related to deposits, which affect
only production rates. In the Drinking Water and Sewer Systems sector of this report (Appendix K), 50 percent of
the costs of fouling were corrosion-related. Applying this factor to the water handling half of the refining process,
the fouling-related corrosion costs in the refining sector are estimated to be $2 billion total costs x (1/2 fluid
volume on water handling portion of refining process x 50% corrosion-related fouling costs = $0.5 billion.

The estimate of the total annual cost of corrosion in refining applications is therefore:

$1.767 billion operational costs for corrosion
$1.425 billion turnaround costs
$0.500 billion fouling costs
$3.692 billion total cost of corrosion

Acidic Crude Oils

As was discussed earlier, the refiners willingness to accept the more corrosive, acidic crude oils has heavily
influenced U.S. refinery operations due to the lower cost of the feedstock.

It can be anticipated that the growth in expenditures for corrosion can be expected to increase at the rate of the
acidity in the crude oil refined. Therefore, this cost is part of the incremental maintenance cost, but in the near
future, this will become a significant expenditure.

For a typical carbon steel distillation column running acidic crude oil, there are additional costs associated with
corrosion coupons and probes for monitoring, nondestructive testing and analysis, and chemical treatment. It should
be noted that these costs, shown below in figure 5, have a wide variance associated with them.


0
2
4
6
8
10
12
C oupons Probes Inhibitors N D E TO TA L
C
o
s
t
/
b
b
l
,

c
e
n
t
s
LO W
HIGH


Figure 5. Incremental costs for corrosion control of carbon steel distillation column.
(12)



The total cost for chemical treatment and all associated costs in the column range from $0.01 per bbl to a high
of $0.11 per bbl. The figure is dominated by the chemical cost of the inhibitors. One study estimated that the total
inhibitor cost associated with refinery operations in the United States was $246 million in 1998.
(13)

Appendix U Petroleum Refining



U15
Alternatively, a metallurgical upgrade in susceptible areas for a $120,000-bbl per day refinery is estimated to
be $12 million to $20 million, which could be economically feasible if the refinery has a long-term commitment to
processing acidic crudes. Based on a 20-year design life (typical for alloys), the incremental costs become $0.18 to
$0.30 per bbl (higher than the costs for treatment with corrosion inhibitor, but comparable). The increased chance
for success with the use of alloys relative to corrosion inhibitor treatments makes these options worth further study.

Failure Costs

The costs associated with catastrophic failures are very difficult to quantify since they include the costs of
equipment replacement, production loss, and sometimes lost lives and litigation. In addition to the direct costs,
indirect costs in publicity and increased scrutiny cannot be quantified.

Analyzing processing industry data for August 2000,
(14)
9 incidents (fire, explosion, leak, or emergency
shutdown) were reported at refineries in the United States out of a total of 52 total incidents during that month. The
cause of each is still being investigated, but all of these incidents resulted in some loss of production and a
significant economic impact.


CASE STUDY

Corrosion-Related Failure in Refinery

This example clearly illustrates the hazards associated with amine absorber pressure vessels used in refineries.
On July 23, 1984, a refinery at Romeoville, Illinois, owned and operated by the Union Oil Company of California,
experienced a disastrous explosion and fire.
(10,15)
An amine absorber pressure vessel ruptured and released large
quantities of flammable gases and vapors. Seventeen lives were lost, 17 individuals were hospitalized, and more
than $100 million in damages resulted.

The National Bureau of Standards (NBS) conducted a detailed investigation, which included chemical
analyses, fracture mechanics analyses, stress corrosion cracking (SCC) susceptibility tests, and hydrogen cracking
susceptibility tests. Preliminary NBS test results indicated that the subject plate material (ASTM A516, Grade 70
carbon steel) of the amine absorber was susceptible to hydrogen-induced cracking. Furthermore, repair welds that
were done in the field and that had not been stress relieved, were especially sensitive to amine-induced corrosion
and cracking. Figure 6 is an example of SCC both parallel and perpendicular to the weld, but not in the weld. The
propagation of the crack clearly distinguishes SCC and reflects the different stresses along the weld area.



Figure 6. Stress corrosion cracking near a weld.
Appendix U Petroleum Refining



U16
REFERENCES

1. Energy and Environmental Profile of the U.S. Petroleum Refining Industry, report by Energetics Inc. for
the U.S. Department of Energy, 1998.

2. Petroleum Industry of the Future, www.oit.doe.gov/petroleum, October 2000.

3. Petroleum Supply Annual 1999, Vol. 1, Energy Information Administration.

4. Petroleum Refining Corrosion, www.hghouston.com/refining.html#top, October 2000.

5. R.A. White, Materials Selection for Petroleum Refineries and Gathering Facilities, NACE, 1998.

6. Refinery Materials of Construction, www.corrmet.ndirect.co.uk/steel.htm.

7. C. Shawber and P. Manning, Haynes International, Personal Communication, August and September 2000.

8. The Impact of Environmental Compliance Costs on U.S. Refining Profitability, Energy Information
Administration, October 1997.

9. D. Ditz, J. Ranganathan, and R. Banks, Green Ledgers: Case Studies in Corporate Environmental
Accounting, World Resources Institute, May 1995.

10. Reduced Corrosion in Amine Gas Absorption Columns,
www.hydrocarbonprocessing.com/archive/archive_99-10/99-10_reduce-mogul.htm, October 2000.

11. Petroleum Project Fact Sheet Fouling Minimization, U.S. Department of Energy, Office of Industrial
Technologies, January 1999.

12. J. Skippins, D. Johnson, and R. Davies, Corrosion Mitigation Program Improves Economics for Processing
Naphthenic Crudes, Oil & Gas Journal 98, 2000.

13. Corrosion Inhibitors Market Analysis, Publications Resource Group Inc., 1999.

14. Process Incidents, August 2000, www.saunalahti.fi/ility/PI0008.htm, October 2000.

15. V. Novokshchenov, Proceedings of Fifth Middle East Corrosion Conference, Oct 28-30, 1991, Manama,
Bahrain, pp. 209-223