cpd-pcprs-15-025 knpc think k event tuesday 27 th october 2015 refinery – petrochemical...
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CPD-PCPRS-15-025
KNPC Think K EventTuesday 27th October 2015
Refinery – Petrochemical Integration
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CPD-PCPRS-15-025
Agenda
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World Refining Scenario
Benefits of integration
Strategic Advantage
KPC’s Strategic Direction
ZOR – Petchem Study
Configuration options
Conclusion & Path Forward
CPD-PCPRS-15-025
World Refining Scenario
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In the past, Refining was seen as more of an independent business enjoying good margins.
Currently Refining business is facing challenges due to
Volatile oil prices Unstable refining margins Increased alternative fuel awareness Global overcapacity Superior product quality requirements Stringent emission regulations Increased processing of heavy and sour crude Increased emphasis on bottom-of-the-barrel conversion
Integration with Petrochemical is vital to deal with ongoing uncertainty in refining business and to sustain and improve Profitability.
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Benefits of integration
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Proximity of Feedstock
Reduction in transport (costs and risks)
Working capital savings
Synergies from joint infrastructures and logistics
Reduction in Operating costs (steam, utilities)
Shared support services: maintenance, HR, HSEQ management, F&A, etc.
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Strategic advantage
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Product Diversification
Reduced exposure to market risk
Independence and supply security
Long-term stream exchanges
Common business and investment strategy
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KPC’s Strategic Direction
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Grow KPC domestic refining capacity up to 1.4 mmbpd on the medium term
Maximize disposal of Kuwaiti heavy crude in domestic refineries
Maximize complexity of KPC domestic refineries, while meeting local energy demand requirement
Provide petroleum products that meet domestic energy, transportation and industrial requirements and international market needs in terms of Quantity and quality
Operate KNPC refineries with high standards of operational excellence
Provide required Gas Processing capacity according to upstream Gas availability profiles
Maximize integration of refining and petrochemical operations domestically
CPD-PCPRS-15-025
Objective of ZOR-Petchem Integration Pre Feasibility Study
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“Establish the most feasible petrochemical option for Kuwait on a commercially competitive basis and to develop a configuration for a World-Scale Petrochemical Complex Integrated with ZOR”
• Achieved by conducting: Market Study Strategic Assessment Prefeasibility Study Feasibility Study Single configuration to be selected to develop in more detail
CPD-PCPRS-15-025
• Two crudes would be run for each proposed configuration: Mixed crude as the reference case Kuwait Export Crude (KEC)
• Maximise economic returns for each proposed configuration
• Meet gasoline (95/98 octane) demand (1-2 MMTPA) while minimising impact on LSFO supply
• Increase synergies between the domestic refining & petrochemical business
Key study basis
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Configuration options
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Options
(Propane Dehydrogenation)
(Paraxylene)
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• Option 3 and Option 6 are shortlisted after Pre Feasibility Study
• Option 3 results in good integration economics, Option 6 provides higher product diversification.
• One option will be selected at the end of Feasibility Study which is expected to complete by Dec. 2015
• FEED is expected to start by early 2017
• World scale Grass root ZOR – Petrochemical complex will place KPC and Kuwait in a privileged position in World’s Oil Industry
Conclusion and Path Forward
CPD-PCPRS-15-025
Thank you
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• PDH – Propane Dehydrogenation
• PX – Para Xylene
• FCC – Fluidised Catalytic Cracker
• SC – Steam Cracker
• LSAR – Law Sulfur Atmospheric Residue
• VGO – Vaccum Gas Oil
Glossary
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Products considered in ZOR - Petchem Integration study
Option 3Core Products Derivatives Key Uses
Aromatics Block
Para Xylene PTA / PET Plastic Industry
Benzene Styrene
FCC Block
Propylene To PDH Block
Mogas Local Market / Export
PDH Block
Propylene Poly Propylene, Propylene Oxide, Propylene Glycol, Polyols
Acrylic Polymers, Glycol, Epoxy Resins
Option 6Core Products Derivatives Key Uses
Aromatics Block
Para Xylene PTA / PET Plastic Industry
Benzene To Cracker Block
FCC Block
Propylene To Cracker Block
Mogas Local Market / Export
Cracker Block
EthylenePE (Poly Ethylene), EAO (Ethanol Amine), MEG (Mono Ethylene Glycol), Styrene
PVC (Poly Vinyl Chloride), Polyesters
Propylene Poly Propylene, Propylene Oxide, Propylene Glycol, Polyols Acrylic Polymers, Glycol, Epoxy Resins
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Back Up
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Petrochemical derivatives considered
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Core
AssessedEAO
Ethylene
Benzene
PX
Butene-1
PE
EO
Styrene
PP
PO
Propylene
MEG
MEG
PG
Polyols
PXButadiene
PTA
PTA PET
Abbr. Long form
PE Poly Ethylene
EO Ethanol Oxide
EAO Ethanol Amines
MEG Mono Ethyl Glycol
PP Poly Propylene
PO Propylene Oxyde
PG Propylene Gylcol
PTA Purified Terephthalic Acid
PET Polyethylene Terephthalate
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Petrochemical Derivatives
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Option 3 configuration C5/C6 to H2 Plant C5/C6 to Gasoline
411 400 Raffinate
NaphthaFR Naphtha Splitter3441 Benzene
343
C7+ PX2225 1000
to Gasoline319
VGO ex ARDS Gasoline2262 C4 from Aromatics Complex Recovery LCO
SlurryIsomerate400
375Isom and CCR C341Purchased Propane 100880 921 750
200
NHT
ISOMERIZATION
CCR and PX Complex
PP
FCC
PDH
Alky
Gasoline HDT
MTBE
PO
PG
Polyols* all values in TPD
Aromatics Block
PDH / PP Block
FCC Block
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Option 6 configurationPX1000
FRN Benzene to Styrene
IsomerateLight Naphtha
RaffinateLPG to Gasoline
C4 from Aromatics Complex RecoveryGasoline
Alkylate
VGO Treated FCC gasoline 100
LCO Propylene MTBE
Slurry 200
Ethylene 1400 Total PERecycle streams
Propylene
Refinery LPG Ethylene Glycol
Purchased Propane80
Butene-1
Benzene from PX Styrene
Butadiene
Aromatics and Naphtha
Isomerization
FCCAlkylation
Gasoline HDT
Steam Cracker
PP
LLDPE/HDPE
MEG
Styrene
PO
PG
Polyols
EO(550kta)
EOA
Butene-1(50kta)
* all values in TPD Ethylene Derivatives
Propylene Derivatives
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Incremental EconomicsRefinery Option1 Option2* Option3 Option4 Option5 Option6
Total Project Capex 18180 24238 22823 25177 30383 30284 31874Total Project IRR -1.10% 0.8% 3.4% 4.6% 2.6% 2.6% 4.5%Integration IRR 6.0% 10.2% 13.8% 7.3% 7.4% 9.9%
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• Based on Economics Option 2, 3 && 6 are shortlisted
• Option-2 was excluded as it is more of a refining option, without much integration with petrochemicals
• Option 3 & 6 both have Aromatics and FCC. Additionally Option 3 has PDH and Option 6 has Steam Cracker
• Option 3 provides integration with Propylene Value chain
• Option 6 provides integration with Propylene as well as Ethylene value chain
Options
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Preferred Options
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• Based on Economics Option 2, 3 && 6 are shortlisted
• Option-2 was excluded as it is more of a refining option, without much integration with petrochemicals
• Option 3 & 6 both have Aromatics and FCC.
• Additionally Option 3 has PDH and Option 6 has Steam Cracker
• Option 3 provides integration with Propylene Value chain
• Option 6 provides integration with Propylene as well as Ethylene value chain
Options
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Integration Synergies / Benefits
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• Naphtha, raffinate and LPG integration Use of these streams can be optimized by routing to steam cracker feed, PX feed, hydrogen
feed or gasoline pool as optimal One naphtha hydrotreater only to serve the entire project All LPG used internally Depending on the selected option, all naphtha also used internally
• FCC and steam cracking have a number of synergies: Ethylene recovery from FCC dry gas Propylene recovery C4s and MTBE Use of LCO as quench oil (not in the LP)
• Common or linked hydrogen system• Common or linked fuel gas system• Capital cost synergies in the utilities and off-site system
Estimated at 1-2% of OSBL costs in a very preliminary manner
• Operating cost synergies
FS expected to provide a better estimate
Specific to Option 6
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Ethylene Uses
Ethylene - C2H4 - is used for accelerating the ripening of bananas, and maturing the color of citrus fruits. It is also used to increase the growth rate of seedlings, vegetables, and fruit trees; in oxyethylene welding and cutting of metals; in manufacture of mustard gas, ethylene oxide, ethylene alcohol, polyethylene and other plastics; and as an inhalation anesthetic. The simplest member of the olefinic hydrocarbon series and one of the most important raw materials of the organic chemical industry; chemical formula, CH2 {double bond} CH2. It occurs in both petroleum and natural gas, but the bulk of the industrial material is produced by heating of higher hydrocarbons. Numerous large-scale processes have been developed, using raw materials ranging from ethane to whole crude oil; in the U.S., ethane and ethane-propane mixtures are commonly used.
Ethylene undergoes polymerization (combination of small molecules to form large molecules) to polyethylene, a plastic material having many uses, particularly in packaging films, wire coatings, and squeeze bottles. The polymerization may be carried out at high pressures and temperatures or by the more recently introduced Ziegler process, which uses a catalyst. With sulfuric acid, ethylene forms a mixture of sulfates that can be hydrolyzed to ethyl alcohol; it combines with chlorine or bromine to yield the corresponding ethylene dihalides, useful solvents and gasoline additives. The reaction of ethylene and oxygen gives ethylene oxide, used in the manufacture of antifreeze, detergents, and other derivatives. Ethylene and benzene combine to form ethylbenzene, which is dehydrogenated to styrene for use in the production of plastics and synthetic rubber.
In botany, ethylene is a plant hormone that inhibits growth and promotes leaf fall. In fruit, how-ever, ethylene is regarded as a ripening hormone. Involved in its action in fruit is some other factor that influences ethylene sensitivity of the tissues.
Pure ethylene is a colourless, flammable gas having a sweetish taste and odour; it freezes at -109.4° C (-272.9° F) and boils at -103.9° C (-155.0° F).