Developing New Product Gasoil Low Sulphur 50 ppm

SAHKUNDIYAR
29121389

SCHOOL OF BUSINESS AND MANAGEMENT

INSTITUT TEKNOLOGI BANDUNG
TAHUN 2022

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1. Introductrion

1.1. Introduction
A. Pertamina Dumai Refinery is one of the Facilities owned by Pertamina/PT. KPI which
located in Dumai, Riau.

Picture 1. Pertamina Refinery

This refinery processing crude oil from Rokan Block (Minas, Duri) also Banyu Urip
from Cepu. The product of Pertamina Dumai Refinery consist of LPG, Gasoline series
(Pertalite, Pertamax), Gasoil 2500 ppm, Gasoil 300 ppm, and Green Coke.

Picture 2. Configuration Pertamina Dumai Refinery

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 B. Owing to Paris Agreement and commitment all country to reduce GHG emission and
contribute decarbonization activities, one of the challenges for fuel producer is
providing cleaner fuel (lower sulphur content), Currently the gasoil product of
Pertamina has specification around 300 ppm wt, this number is still not meet EURO
IV spec which is maximum sulphur content 50 ppm.

1.2. Problem Statement

Pertamina Dumai Refinery is challenged to produce new product gasoil 50 ppm (EURO
IV comply), it is big challenge since previously no experience yet but from the design
stream of Dumai Refinery it is possible for producing gasoil 50 ppm from Hydrocracker.
Further analysis and evaluation need to be conducted to ensure the method of production
and facility needed.

2. Methodology
2.1. Literature Review
A process is a sequence of steps that transforms a set of inputs into a set of outputs. Most
people are familiar with the idea of physical processes, such as those used to bake a cake
or to assemble an automobile. A product development process is the sequence of steps or
activities that an enterprise employs to conceive, design, and commercialize a product.
Many of these steps and activities are intellectual and organizational rather than physical.
Some organizations define and follow a precise and detailed development process, while
others may not even be able to describe their process. Furthermore, every organization
employs a process at least slightly different from that of every other organization. In fact,
the same enterprise may follow different processes for each of several different types of
development projects

The generic product development process consists of six phases, as illustrated in Exhibit
2-2. The process begins with a planning phase, which is the link to advanced research and
technology development activities. The output of the planning phase is the project’s
mission statement, which is the input required to begin the concept development phase
and which serves as a guide to the development team. The conclusion of the product
development process is the product launch, at which time the product becomes available
for purchase in the marketplace

One way to think about the development process is as the initial creation of a wide set of
alternative product concepts and then the subsequent narrowing of alternatives and
increasing specification of the product until the product can be reliably and repeatably
produced by the production system. Note that most of the phases of development are
defined in terms of the state of the product, although the production process and marketing
plans, among other tangible outputs, are also evolving as development progresses. Another
way to think about the development process is as an information-processing system. The
process begins with inputs such as the corporate objectives, strategic opportunities,
available technologies, product platforms, and production systems. Various activities
process the development information, formulating specifications, concepts, and design
details. The process concludes when all the information required to support production
and sales has been created and communicated. A third way to think about the development
process is as a risk management system. In the early phases of product development,

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various risks are identified and prioritized. As the process progresses, risks are reduced as
the key uncertainties are eliminated and the functions of the product are validated. When
the process is completed, the team should have substantial confidence that the product will
work correctly and be well received by the market. Exhibit 2-2 also identifies the key
activities and responsibilities of the different functions of the organization during each
development phase. Because of their continuous involvement in the process, we choose to
articulate the roles of marketing, design, and manufacturing. Representatives from other
functions, such as research, finance, project management, field service, and sales, also
play key roles at particular points in the process. The six phases of the generic
development process are:
a. Planning: The planning activity is often referred to as “phase zero” because it precedes
the project approval and launch of the actual product development process. This phase
begins with opportunity identification guided by corporate strategy and includes
assessment of technology developments and market objectives. The output of the
planning phase is the project mission statement, which specifies the target market for
the product, business goals, key assumptions, and constraints
b. Concept development: In the concept development phase, the needs of the target
market are identified, alternative product concepts are generated and evaluated, and
one or more concepts are selected for further development and testing. A concept is a
description of the form, function, and features of a product and is usually accompanied
by a set of specifications, an analysis of competitive products, and an economic
justification of the project
c. System-level design: The system-level design phase includes the definition of the
product architecture, decomposition of the product into subsystems and components,
preliminary design of key components, and allocation of detail design responsibility
to both internal and external resources. Initial plans for the production system and final
assembly are usually defined during this phase as well. The output of this phase usually
includes a geometric layout of the product, a functional specification of each of the
product’s subsystems, and a preliminary process flow diagram for the final assembly
process
d. Detail design: The detail design phase includes the complete specification of the
geometry, materials, and tolerances of all of the unique parts in the product and the
identification of all of the standard parts to be purchased from suppliers. A process
plan is established and tooling is designed for each part to be fabricated within the
production system. The output of this phase is the control documentation for the
product—the drawings or computer files describing the geometry of each part and its
production tooling, the specifications of the purchased parts, and the process plans for
the fabrication and assembly of the product
e. Testing and refinement: The testing and refinement phase involves the construction
and evaluation of multiple preproduction versions of the product. Early (alpha)
prototypes are usually built with production-intent parts—parts with the same
geometry and material properties as intended for the production version of the product
but not necessarily fabricated with the actual processes to be used in production
f. Production ramp-up: In the production ramp-up phase, the product is made using the
intended production system. The purpose of the ramp-up is to train the workforce and
to work out any remaining problems in the production processes. Products produced
during production ramp-up are sometimes supplied to preferred customers and are
carefully evaluated to identify any remaining flaws

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 2.2. Methodology
The methodology applied for developing new product gasoil 50 ppm can be described as
follow:

3. Analysis
3.1. Analyze the Data
From the lab analysis data, it is known that there is possibility Pertamina Dumai able to
produce Gasoil 50 ppm from Hydocracker. The stream of each Plant in Pertamina Dumai
as follow:
Table.1 Product Stream of Gasoline component in Pertamina Dumai

From above data, it can be seen that Gasoil 50 ppm can be produced from Plant
Hydrocracker which is the suplhur <10 ppm. The challenge is we don’t have any
method/procedure how to develop new product yet.
Tabel 2.Complete specification of Gasoil 50 ppm

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4. Result and Conclusion
4.1. Result and Explanation
Regarding the product development and design, it is challenging to produce new product
Gasoil 50 ppm, since this slate of product was never produced before, several activities
which can done as follow:
a. Planning
In the planning step, the main activities are identified what is the current situation of
stream quality data, then prepare the action item need to be taken. From the analysis
data it is known that gasoil 50 ppm could be produced from Hydrocracker Plant, but
this early data should be followed up by evaluation, modification further.
In the end of Planning phase decided several target as follow:
- Project mission: to develop and launch new product gasoil 50 ppm
- Specific target market: high technology/end cars which need better fuel quality,
everyone who prioritize high quality fuel for their cars,
- Business goal: to produce and sell gasoil 50 ppm since the price is higher than
- Initial plan how to realize commercial production of the new product
b. Concept development
In the concept development, we need to develop some detail of the fundamental of
new product development as follow:
- Target Market: high technology/end cars which need better fuel quality, everyone
who prioritize high quality fuel for their cars,
- New Product concept creation: consist of several activities such are data gathering,
analysis and evaluation stream product to meet gasoil 50 ppm spec, review the
production facilities (line and storage tank, lifting)
- The economic impact of this new development product is quite interesting as
follow:
Table 3. Financial Impact Estimate

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c. System Level Design
To produce gasoil 50 ppm the scheme that can implemented as follow
- Stream Kerosene and gasoil from HCU will be blend in line/sequently into
dedicated storage tank, after the production finished then the product will be
analyzed as gasoil 50 ppm.
- The on-spec gasoil 50 ppm will be lifting to the vessel

Picture 3. Scheme for producing new product gasoil 50 ppm

- Refer evaluation and lab analysis, the blending composition for producing gasoil
50 ppm will be 85% Kerosene HCU and 15% Solar HCU with final quality as
follow (on spec):
Tabel 3. Lab Analysis for blending composition

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 d. Testing and refinement
After conducting lab scale test, then it is needed to verify actual Plant for producing
Gasoil 50 ppm
Table 4. Item checking list for producing new gasoil 50 ppm

After checking all option for producing Gasoil 50 ppm, also ensure facilities needed it
is concluded that Pertamina Dumai is able to produce Gasoil 50 ppm

e. Production ramp-up
Before production ramp up, it is needed to develop system and procedure for ensuring
that the production process from step production planning, execution, analysis, and
sales/lifting.
- Establisht work procedure which covering method for producing gasoil 50 ppm
- Establish management of change related facilities (line and storage tank, etc) in
order ensuring that production activity of gasolil 50 ppm will meet the quality
aspect and safe
- Execute production new gasoil 50 ppm with previous blending composition and
utilize the facilities that has been prepared
- Lifting/sale the on spec gasoil 50 ppm to the customer

4.2. Conclusion
Pertamina Dumai refinery has hig possibility to produce new product gasoil 50 ppm since
there is Plant Hydrocracker which can produce low sulphur product. The main challenging
that there were no method and no further evaluation conducted to produced new product.
By conduncting several activities product and design development (planning, concept
development, system level design, detail design, testing and production ramp up) then new
product gasoil 50 ppm can be produced.

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Reference:
- Ulrich, Eppinger. Product Design and Development
- SBM ITB. (2022). Process Design and Analysis. Bandung: SBM ITB.
- SBM ITB. (2022). Project Management. Bandung: SBM ITB

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Exhibit

List of Figure:
Figure 1. Pertamina Refinery
Figure 2. Configuration Pertamina Dumai Refinery
Figure 3. Scheme for producing new product gasoil 50 ppm

List of Table:

Table 1. Product Stream of Gasoline component in Pertamina Dumai

Table 2. Complete specification of Gasoil 50 ppm
Table 3. Financial Impact Estimate
Table 4. Item checking list for producing new gasoil 50 ppm

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