Refining ABC

Kjetil Hauge
Head of Technical Oil Analysis
Oil Trading & Supply

Outline
Introduction to oil refining Distillation
Refinery configurations
Topping
Hydroskimming
Cracking
Coking

Refinery development
Refinery Margins -> Sandrine

Introduction to Crude oil Refining - Distillation

100 %

90 %

80 %

70 %

60 %

50 %

40 %

30 %

20 %

10 %

0%
Alba
VAC. RES.

VAC. GO

Brent
HGO

Statfjord
LGO

KERO

Sleipner
HVN

LVN

GAS

Introduction to Crude oil Refining - Distillation

100 %

140
90 %

120

80 %

70 %

100

60 %

Naphtha Physc
Gasoline
Diesel
HSFO 3.5%
Brent Dated

$/bbl

80
50 %

60
40 %

40

30 %

20 %

20

10 %

0
2003

0%
Alba
VAC. RES.

VAC. GO

Brent
HGO

Statfjord
LGO

KERO

Sleipner
HVN

LVN

GAS

2004

2005

2006

2007

2008

2009

Refinery type/complexity
World Refining Capacities (Total = 90 662 kbpd)
1192

2 377
Topping

8 306

Majority Cracking
refineries

Increasing share of more

complex refineries

Topping refineries - small

share

Hydroskimming
Cracking
Coking
Other
33 293

45 494

Source: PIRA

World Refining Capacities (Total = 90 662 kbpd)

1192

2 377
Topping

8 306

Hydroskimming
Cracking

Topping refinery

Coking
Other

Products

33 293

LPG
LPG

Light naphtha
Naphtha
45 494

CRUDEDISTILLATION

Heavy
naphtha

Source: PIRA

Gasoline

100
Crude

Kerosin

80

Jet/Kero
Gasoil

LPG
Naphtha
Gasoline
Jet/Kero
Diesel/Gasoil
SRFO
HFO

60
Diesel /
gasoil

wt%
40

Atmospheric
residue

20
Straight
run fuel
oil

A Topping Refinery is the simplest kind of oil refinery.

It only splits the crude oil in its main components. A large portion of SR fuel oil.

TOP

World Refining Capacities (Total = 90 662 kbpd)

1192

2 377
Topping

8 306

Hydroskimming

Hydroskimming refinery

Cracking
Coking
Other

Products

33 293

LPG
LPG
Light naphtha
Naphtha
45 494

CRUDEDISTILLATION

Heavy
naphtha

REFORMER

Reformate

Source: PIRA

Gasoline

100

Hydrogen
Crude

Kerosine

80
Jet/Kero
LPG

Gasoil

HYDROTREATER

Naphtha

60
Diesel /
gasoil

Gasoline

wt%

Jet/Kero
Diesel/Gasoil

40

SRFO

Atmospheric
residue

HFO

20
Heavy fuel
oil

0
TOP

HSK

A Hydroskimming Refinery is a little more advanced. It has a naphtha reformer (REF) and
can produce gasoline, but maintain a high SR fuel oil production.

World Refining Capacities (Total = 90 662 kbpd)

1192

2 377
Topping

8 306

Hydroskimming
Cracking
Coking
Other

Catalytic cracking (FCC) refinery

33 293

Products
LPG

45 494

LPG
Source: PIRA

Light naphtha

ISOMERISATION

Naphtha

Isomerate

100

CRUDEDISTILLATION

Heavy
naphtha

REFORMER

Reformate
Gasoline
Iso-butane

H2
Crude

ALKYLATION

80

Alkylate

Kerosine

60

Jet/Kero
wt%

Gasoil

Atmospheric
residue

40

HYDROTREATER

Diesel /
gasoil
Gasoil

VGO
Vacuum
distillation

CATALYTIC
CRACKER
(FCC)

Vacuum Residue

20

C3/C4
Olefines

FCC naphtha
Heavy fuel
oill

0
TOP HSK FCC HCR

HFO
Diesel/Gasoil
Gasoline
LPG

A FCC Refinery
-is a medium upgraded refinery
-can convert SR fuel oil to gasoline and diesel in the FCC unit. There is still some fuel oil production.

SRFO
Jet/Kero
Naphtha

World Refining Capacities (Total = 90 662 kbpd)

1192

2 377
Topping

8 306

Hydroskimming
Cracking
Coking
Other

Coking refinery

33 293

Products
LPG
45 494

LPG

Source: PIRA

Light naphtha

ISOMERISATION

Naphtha

Isomerate

100

REFORMER

Reformate
Gasoline
Iso-butane

H2

Alkylate

60

Kerosine

wt%
Jet/Kero

Diesel /
gasoil

Vacuum
distillation

FCC naphtha
Heavy fuel
oill
Gasoline

VRES

Coker

HFO

SRFO

Diesel/gasoil

Diesel/Gasoil

Jet/Kero

Heavy fuel oil

Gasoline

Naphtha

LPG

A Coker Refinery is the most advanced oil refinery.

It upgrades most of the fuel oil to lighther products

ng

CATALYTIC
CRACKER
(FCC)

ng

VGO

C3/C4
Olefines

/Cok
i

Gasoil

20

Coki

Atmospheric
residue

HYDROTREATER

TOP

Gasoil

40

HCR

Crude

ALKYLATION

80

FCC

Heavy
naphtha

HSK

CRUDEDISTILLATION

Coking refinery Distribution

Coking (Total = 33 293 kbpd)

Additional coking capacity 2000 -> 2009

192

141

709

NAM
318

LAM

NAM
9

Europe

Middle East

Middle East
China

China

2024

Rest Asia

Rest Asia

Africa

Africa

ANS

FSU
ANS

LAM

1839

Refinery development - History

Refinery capacity changes 2000 -> 2009

9000
8000

Major changes in refinery capacity

in period 2000 2009
Cracking an Coking close to
100% of the increase

7000
6000
5000

Other

kbpd

Coking
4000
3000
2000
1000
0
-1000

Cracking
Hydroskimming
Topping

Hydroskimming decreasing
Have seen marginal refinery
drifting towards Cracking type
refineries

Refinery development Going forward

Expect increasing demand on distillates on expense of gasoline
Best margins expected on refineries producing higher share of distillates
(Coking and Hydrocracking)
Weaker margins on refineries producing high share of gasoline (FCC)

Effectivisation of the refinery business expected (i.e. some of the refineries with
lowest margins expected to close down)
Cracking type refineries marginal refinery

Forward Looking Statements

This presentation contains certain forward-looking
statements that involve risks and uncertainties. In
some cases, we use words such as "believe",
"intend", "expect", "anticipate", "plan", "target" and
similar expressions to identify forward-looking
statements.
These forward-looking statements reflect current
views with respect to future events and are, by
their nature, subject to significant risks and
uncertainties because they relate to events and
depend on circumstances that will occur in the
future. There are a number of factors that could
cause actual results and developments to differ
materially from those expressed or implied by
these forward-looking statements, including levels
of industry product supply, demand and
pricing; currency exchange rates; the political and
economic policies of Norway and other oilproducing countries; general economic conditions;
political stability and economic growth in relevant
areas of the world; global political events and
actions, including war, terrorism and sanctions;
changes in laws and governmental regulations; the
timing of bringing new fields on stream; material
differences from reserves estimates; an inability to
find and develop reserves; adverse changes in tax
regimes; the development and use of new
technology; geological or technical difficulties;
operational problems; the actions of competitors;
the actions of field partners; natural disasters and
adverse weather conditions; and other changes to
business conditions; and other factors discussed
elsewhere in this report.

Additional information, including information on

factors which may affect Statoil's business, is
contained in Statoil's 2008 Annual Report on Form
20-F filed with the US Securities and Exchange
Commission, which can be found on Statoil's web
site at www.Statoil.com.

Although we believe that the expectations

reflected in the forward-looking statements are
reasonable, we cannot assure you that our future
results, level of activity, performance or
achievements
will
meet
these
expectations. Moreover, neither we nor any other
person assumes responsibility for the accuracy
and completeness of the forward-looking
statements. Unless we are required by law to
update these statements, we will not necessarily
update any of these statements after the date of
this review, either to make them conform to actual
results or changes in our expectations.