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Refinery Configuration Studies on Indigenous and Imported Crude Oils

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Abstract: Simulation of six refinery configurations for capacities ranging between 3 and 30 MMTPA has been carried out on Bombay High and Arab Heavy crude oils. Linear programming was employed to predict yields, product properties and utility consumptions. An optimizer was used to vary selected parameters to maximize the overall profit. Economic analysis like profit/barrel of crude, requirements of capital investment, simple payback period and internal rate of return has also been carried out. The results of the study shows that refinery profit ranges from about $10 to $18 per barrel of crude depending upon throughput, crude properties and the configuration selected. It initially increases with capacity but gets stagnated at around 12 – 18 MMTPA capacity. Although, this suggests that the optimum capacity is 18 MMTPA for a grassroots refinery, other factors like simple payback favor higher capacities. A typical 30 MMTPA refinery requires a capital investment of around Rs. 25,000 – 40, 000 crores with a payback period of 1.5 – 3 years. The Internal Rate of Return (IRR) is highly sensitive to crude oil and product prices. Higher capacity refineries (24-30 MMTPA) are more resistant to these variations. Generally, for a 10 times increase in capacity (from 3 to 30 MMTPA), the investment requirement increases 4-5 times, the payback period gets halved and the increase in profit/bbl is between 2 to 3 US$. Keywords: Refinery Configuration, Bombay High, Arab Heavy, Linear Programming, Zero Residue, Economic Analysis

Introduction
Buoyed by the revival of the global economy, India today seeks to achieve the goals of Hydrocarbon Vision 2025 with renewed vigor and enthusiasm. Our key advantages like cheaper capital, power and labor costs and strategic location provide a potential of becoming a refining hub of South Asia and SouthEast Asia. However, Indian refining industry needs to modify its crude processing schemes so as to provide cleaner fuels as per the Auto Fuel Policy. The declining crude quality and the obvious advantages Engineeringpapers.blogspot.com

in processing opportunity crudes may require refiners to process a large share of heavy crudes. In such a scenario, selection of refinery configurations optimum for processing heavy crudes will be the key to sustainability. Also, we cannot overlook the refining of our indigenous crudes in general and Bombay High in particular whose production has recently showed an upward trend after almost a decade of stagnation [1-6]. A petroleum refinery has to operate under technical, economical, environmental, social and political constraints. Therefore, the process of planning a grassroots refinery has achieved unparalleled significance in today’s scenario. Earlier studies on refinery configurations for Indian conditions have taken a mix of light and heavy crudes [7,8]. In the present study, optimization of the selected refinery configurations, particularly the residue processing schemes, were carried out so as to maximize the refinery profits. All the configurations have “Zero Residue” and “Zero Fuel Oil” refinery producing Euro IV specification fuels. The desired products are LPG, gasoline, kerosene and diesel.

Configuration Studies
Linear Programming technique, using a commercially available simulator – PetroPlan, was employed to predict yields, product properties and utility consumptions. A built-in optimizer was used to vary selected parameters to maximize the overall profit. Bombay High (API - 40.78, Sulfur - 1.24) and Arab Heavy (API – 28.22, Sulfur – 2.8%) crude oils were simulated for six refinery configurations as shown in Table l. These configurations were selected with the aim of catering to the need of selected petroleum products in the country, conforming to the stringent environmental regulations. They differ basically in their residue processing options. All employ gasification, in combination with other residue processing units, so as to achieve the target of “Zero Residue” and “Zero Fuel Oil” refinery [9-12]. Six levels of refining capacity – 3, 6, 12, 18, 24 and 30 MMTPA, has been simulated for LPG, Gasoline, Kerosene and Diesel as the desired products. Other details are given elsewhere [13]. The yields for various configurations are shown in Table 2. Table 1. Refinery configurations Process Units CDU-VDU Naphtha Hydrotreater Kerosene Hydrotreater Diesel Hydrotreater Mild Pressure Hydrocracker Gas Oil Hydrotreater FCC Catalytic Reformer Alkylation LPG Recovery Solvent Deasphalting Visbreaker Delayed Coker Resid Hydrocracker 1 X X X X X X X X X X X 2 X X X X X X X X X X Configurations 3 4 X X X X X X X X X X X X X X X X X X X X X X X 5 X X X X X X X X X X X X X 6 X X X X X X X X X X X

X

Gasifier

X

X

X

X

X

X

The LPG yield of Arab Heavy is minimum for configuration 1 (1.26%) and is maximum for configuration 6 (1.63%). Configurations 1, 2 and 3 indicate that the Resid Hydrocracker configuration gives highest LPG yield and the same is substantiated by configurations 4, 5 and 6. Configuration 5, having a delayed coker, gives the highest gasoline yield (59.76%). But when delayed coker is used without solvent deasphalting the gasoline yield is reduced to 55.66%, as evident from configuration 2. The minimum gasoline yield is obtained in configuration 4 (53.41 %). Since gasoline is the highest value product considered in the present study, its yield is very important in the final economic analysis. Table 2. Yields for different configurations Products 1 LPG, % vol. Gasoline % vol. Kerosene, % vol. Diesel, % vol. Fuel Gas, %wt H2S, % wt LPG, % vol. Gasoline % vol. Kerosene, % vol. Diesel, % vol. Fuel Gas, %wt H2S, % wt 2.057 67.969 11.144 24.523 3.575 2.734 1.67 55.044 20.985 24.638 2.526 1.507 2 2.224 67.696 14.252 24.865 4.100 2.836 1.399 59.619 20.032 21.454 2.843 1.519 Configurations 3 4 2.514 68.283 13.706 23.620 2.825 2.329 2.129 62.869 20.236 17.137 4.408 1.509 1.795 65.507 13.73 23.366 4.271 2.335 1.625 54.750 25.040 18.165 5.612 1.513 5 1.795 65.507 13.73 23.366 4.271 2.335 1.476 64.709 19.974 15.787 4.004 1.497 6 2.688 66.733 20.493 19.236 5.145 2.685 1.811 52.877 25.156 22.127 3.661 1.512

Yields with Arab Heavy

Yields with Bombay High

Arab Heavy gives maximum kerosene yield in configuration 6 (17.65%) followed by configuration 4 (17.45%). These configurations use solvent deasphalter along with delayed coker and resid hydrocracker, respectively. But when solvent deasphalter is employed alone in configuration 1, it gives minimum (9.83%) yield of kerosene. Yields of diesel exhibit the trend just reverse of the gasoline. Diesel yield for configuration 2 is 23.1% whereas for configuration 5, it is 15.9 %. This implies that adding a solvent deasphalter to configuration 2 is giving additional gasoline in place of diesel for Arab Heavy crude oil. For Bombay High crude oil, configuration 2 gives minimum LPG yield (0.97%) whereas configuration 3 gives the maximum (1.43%). Configurations having Resid hydrocracker is favorable for LPG yield. For gasoline maximization configuration 5, having a delayed coker and a solvent deasphalter, is most suited as it yields more than 10% more gasoline than the least (59.03% against 48.23%). Configuration 6 that yields minimum gasoline, gives maximum kerosene yield (23.75%). Diesel yield is maximum in

configuration 1 (25%) but is minimum when solvent deasphalter is used with delayed coker (15.7%), as in configuration 5.

Economic Analysis
The performance of all configurations has been studied and evaluated with respect to profitability, investment and simple payback. Figure 1 and 2 show profits for different capacities for Arab Heavy and Bombay High, respectively. The profit ranges from about $10 to $18 per barrel of crude. It initially increases with capacity but gets stagnated at around 18 MMTPA capacity. Increasing the capacity beyond 18 MMTPA does not increase the profit per barrel of crude oil. Although, this suggests that the optimum capacity is 18 MMTPA for a grassroots refinery, other factors like simple payback favors higher capacities.

Fig. 1. Variation of profits with capacity for Arab Heavy

Fig.2. Variation of profits with capacity for Bombay High

The investments required for all configurations and the simple payback for them are shown in figures 3 and 5 for Arab Heavy and figures 4 and 6 for Bombay High, respectively.

Fig. 3. Variation of capital investment for all configurations on Arab Heavy

Fig. 4. Variation of capital investment for all configurations on Bombay High

Fig. 5. Variation of simple payback period with capacity for Arab Heavy
Configuration 2 has been randomly selected, without any prejudice, for more detailed economic analysis. The variation of Internal Rate of Return (IRR) with capacity is shown in Figure 4. The IRR more than doubles when the capacity is increased from 3 to 30 MMTPA. It is 15.41% at 3 MMTPA and 32.73% at 30 MMTPA for Arab Heavy. For Bombay High these values are 18.13% at 3 MMTPA and 35.17% at 30 MMTPA.

Fig. 6. Variation of simple payback period with capacity for Bombay High

Fig. 7. Variation of internal rate of return with the refining capacity for both Arab Heavy and Bombay High crude oils

Conclusions
Optimization of the refinery configurations for profit maximization does not give the yield pattern as required by the demand-supply scenario in the country. This is due to the fact that the petroleum product prices are not regulated by the demand-supply scenario. This is a policy matter and needs considerations at appropriate level. The refinery profit ranges from about $10 to $18 per barrel of crude depending upon throughput, crude properties and the configuration selected. It initially increases with capacity but gets stagnated at around 12 – 18 MMTPA capacity. Although, this suggests that the optimum capacity is 18 MMTPA for a grassroots refinery, other factors like simple payback favor higher capacities. For Arab Heavy crude oil, a typical 30 MMTPA refinery requires a capital investment of around Rs. 30,000 – 40, 000 crores with a payback period of 2 – 3 years. For Bombay High, the investment required for 30 MMTPA refinery ranges between Rs. 25, 000 to 30, 000 crores with a payback period of 1.5 - 2.5 years. Generally, for a 10 times increase in capacity (from 3 to 30 MMTPA), the investment requirement increases 4-5 times, the payback period gets halved and the increase in profit/bbl is between 2 to 3 US$.

References
1. 2. 3. 4. 5. 6. Ministry of Petroleum and Natural Gas, Government of India, India Hydrocarbon Vision 2025, http://www.petroleum.nic.in/vision.doc Ghosh, S., “Future Demand of Petroleum Products in India”, Energy Policy, 34(15) , pp. 2032-2037 (2006). Brierley, G.R., Gembicki, V.A., and Cowan, T.M., “Changing Refinery Configuration for Heavy and Synthetic Crude Processing”, http://www.uop.com/objects/ChangingRefineryConfiguration.pdf Goyal, O.P., “The Growth of Indian Petroleum Refinery Industry” Hydrocarbon Processing, (Sept. 2006). Thukral, K., “India’s Oil Policy: To Import Crudes or Products?”, Energy Policy, 18(4), pp. 368-380, (1990). Singh, J., Singh, B.B., Nanoti, S.M., Saxena, A.K. Garg, M.O., “Techno-Economic Evaluation of Refinery Configurations in view of Changing Refining Scenario” Proceedings of 4th International Conference and Exhibition – PETROTECH 2001, New Delhi, (2001). Maiti, S.N., Eberhardt, J., Kund, S., Cadenhouse-Beaty, P.J. and Adams, D.J., “How to Efficiently Plan a Grassroot Refinery”, Hydrocarbon Processing, pp. 43-49 (June 2001). Reyes, E. and Forrest, J., “Companies Find New Value with Refinery-Wide Rigorous Simulation Solutions”, Hydrocarbon Processing, pp. 9–10 (2003). Lucas, A.G. (ed.), Modern Petroleum Technology, Vol. 2, Downstream, 6/e, Institute of Petroleum, U.K., (2000). Gary, J.H. and Handiwerk, G.E., Petroleum Refining-Technology and Economics, Marcel Dekker, Inc., New York (2001). Meyers, R.A. (ed.), Handbook of Petroleum Refining Processes, 2/e, McGraw-Hill Professional Publishing Co., New York (1996). Kafeel, M., “Optimization Studies on Refinery Configurations for Different Crudes”, M.Tech. Dissertation, Aligarh Muslim University, Aligarh, India (2008).

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