Maximise Residue Conversion Economics with UOP

Bottom-of-the-Barrel Technologies

Maximise Residue Conversion Economics with UOP

Bottom-of-the-Barrel Technologies

Soumendra Banerjee (UOP India Pvt Ltd)Phil Hunt (UOP Ltd, UK)

UOP LLC, A Honeywell Company

Soumendra Banerjee (UOP India Pvt Ltd)Phil Hunt (UOP Ltd, UK)

UOP LLC, A Honeywell Company

© 2012 UOP LLC. All rights reserved.

PetroFedInternational Conference on Refining Challenges & Way Forward April 16th -17th 2012, New Delhi, India

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We Will Cover Five Related Topics

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� Why India and Why Now?

� Outline of Process Offering

� Integration Opportunities

� Key Economics Drivers

� Benefits & Opportunities

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2

3

4

5

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UOP UniflexTM Process is Ideal for the Indian Market

� State of the Indian Market− Is the 4th largest oil consumer (after USA, China and Japan)

− The rise in international crude oil prices in recent years has created major challenges for India, given the high reliance on imports, and has resulted in a need to maximize the utilization and conversion of crude oil processed in the country.

− The increased use of heavy crudes, distillate demand, particularly diesel, continues to show strong growth, and Indian refiners are being challenged to provide cleaner fuels to address concerns of air pollution and climate change.

− The cost advantage of heavy crudes over light crudes has incentivized many Indian refiners to process heavier crudes, therefore increasing the heavy residue produced at a time when fuel oil demand is declining.

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These is a strong need of residue upgrading technologiesthat maximize transportation fuels

Let’s Start with the Fundamentals...

What is residue and why convert it?

Characteristics: Heavy, dirty, low value, limited uses

Properties: High MW, stable and carbon rich, hydrogen deficient

Composition: Saturates, aromatics, resins, asphaltenes

Impurities: Sulfur, nitrogen, heavy metals

Vacuum residue is lower value than fuel oil due to the need to use cutter stocks

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Crude Oil and Natural Gas Prices

150

100

50

0Ga

s &

Oil

Pri

ce

($

/MM

BT

U)

Oil P

rice

($/B

BL

)

� Natural gas price has not risen as quickly as crude oil

� This favours upgrading because HFO competes with gas, whereas transportation fuels are linked to crude oil price

� The widening differential favours “Hydrogen Addition,” rather than “Carbon Rejection,” due to:

− Increased product values

− Decreased H2 production costs

20

10

01990 1995 2000 2005 2010

Natural GasCrude Oil

20

10

0

1990 1995 2000 2005 2010

Delta

$/M

MB

TU

Source: BP Statistical Review of World Energy 2011 UOP 5782-5

1990 – 2010 History

By 2010 – fuel oil had declined to only 15%

In 1970, 80, 90 – fuel oil was 50, 40, 30% of distillates demand

By 2020 – fuel oil is likely to be only 10% of distillates demand

Global Oil Product Demand(Heavy Fuel Oil and Distillates)

Millio

n b

arr

els

Per

Day

40

30

20

10

02000 2005 2010

Middle DistillatesLight DistillatesHeavy Fuel Oil

1995

Source: BP Statistical Review of World Energy 2011

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Transport Fuels:Gasoline,Jet FuelDiesel

Distillation

Distillation

Naphtha

Crude Oil

Vacuum Residue

Vacuum Gas Oil

Distillates

Residues:Heavy Fuel Oil,

Pitch, Coke

NaphthaNaphthaHydrotreating Hydrotreating & Reforming& Reforming

FCC FCC ororHydrocrackingHydrocracking

DistillateDistillateHydrotreatingHydrotreating

UOP’s Heavy Oil Upgrading Processes

ResidueResidueConversionConversion

UOP/FWUSASolvent

Deasphalting

FWUSA SYDEC™Delayed Coking

Process

UOP/FWUSAVisbreaking

UOP RCDUnionfining™

Process

UOP Solutions for Residue Conversion

UOP Uniflex™Process

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The Uniflex Technology Offering is......

UNIFLEX UNIT(Wt-%)

100

15

50

15

Vacuum Residue Feed

Naphtha

Diesel

VGO

HDT

MHC & FCC or HCU

� 90% Conversion

� Maximum Diesel

� Minimum VGO

� VGO integration

� Once through Catalyst

� Similar scheme to Unicracking

� Product streams require further upgrading

CatalystH2

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UOP has nearly 100 Years of Technology Expertise

This experience has been utilized to bring to market a commercially proven residue slurry bed hydrocracking technology for licensing…

Significant resources committed to construct and operate the CANMET plant for several years and for the subsequent UOP Uniflex Process

enhancements

Excellent correlation across:

� CANMET commercial plant

� UOP pilot plants

� Scale-up models UOP “SCHEDULE A”

UnicrackingUnicrackingProcessProcess

UnionfiningUnionfiningProcessProcess

Technology Licensing

CANMET

UOP Pilot

Plants

Scale-up Models

� Yields

� Conversion

� Consumption (H2, Catalyst)

� Product qualities

Wide range of:

� Feedstocks

� Operating conditions

Comprehensive feedstock and operating data:

UniflexUniflexProcessProcess

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Process Configuration and Design

REACTOR

FEED HEATING

FRACTIONATION SEPARATION

HOT & COLD SEPARATORS

The Uniflex Process is very similar in scheme to VGO hydrocracking

FEED HEATING, REACTOR, SEPARATION and FRACTIONATION

Uniflex Process operates at a similar reactor pressure to VGO hydrocracking (140 barg) with make-up and recycle hydrogen

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Commercial Operations:

� 5,000 BPD unit operated for 15 years at Petro-Canada Montreal

� Developed excellent design correlations allowing accurate scale-up

� Very high reliability demonstrated

� Achieved 95% conversion

Uniflex ProcessCommercial Experience

UOP Enhancements:

� Completed UOP Schedule A design

� Reflects experience of Petro-Canada Montreal Unit with improvements

– Large single train designs – parallel reactors, common separation

– More efficient heat integration

– High conversion of HVGO

� Integrated pilot plant closely matches commercial performance

� Analytical, modeling development programs support optimization

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Uniflex ProcessThermal Cracking of Asphaltenes

� Heavier, higher sulfur feeds have higher reactivity

� Wide boiling range of products containing olefins, S, N

� Further hydroprocessing of the distillate products is required

Archipelago Model of Asphaltenes, Carbon # = 313, MW = 4705Source: M. Gray, Univ of Alberta

The process benefits from a combination of:

1. Thermal cracking to shorter chain lengths

2. Inhibiting formation of coke through:

Hydrogenation of free radicals formed in thermal cracking

Catalyst physically hinders mesophase coalescence

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Uniflex Process ReactorAchieves High Conversion

Feed, H2and Catalyst

Productsand Catalyst � Optimal design for high conversion

−Upflow

−High temperature and moderate pressure

� Efficient utilization of reactor volume

−Low gas voidage

−High product vaporization

−Near Isothermal

� Asphaltene management

− Inhibit formation of coke pre-cursors

Commercially proven Reactor design with minor scale-up.

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Catalyst & Pitch

� UOP global supply of catalyst

� Multiple manufacturing locations

� Simple logistics and storage

Catalyst

� Cement:

– Often the most attractive outlet option

� Boiler/Power:

– Conventional power plants

– CFB

� Solidification:

– Proven technology

– Facilitates transportation and storage

Pitch

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Uniflex Process Key Success Factors

So what else makes the above even more compelling - the answer is

high crude oil prices

Commercially Proven

Low Value Feed

High Conversion

High Quality Products

Step Change Margin Increase

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Uniflex Complex Scope

Gasoline & Diesel

VGO

Distillates

HCUor

MHC/FCC

DHT

Uniflex Process Integration Benefits

• >55% yield of diesel: 2x Delayed Coking

• Stand-alone hydrotreater produces reformer feed and Euro V diesel

• ½ VGO yield of Delayed Coking enables processing in existing units

UniflexUniflexUnit

VR

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VGOVGOVGOVGO

DistillateDistillateDistillateDistillate

NaphthaNaphtha

NaphthaNaphtha

CokeCoke((WtWt--%)%)

Pitch (Pitch (WtWt--%)%)

Yield Comparison

100

80

60

40

20

0

-20

-40

Vo

lum

e %

Delayed Coking Uniflex Unit

The value-add margin is high – given low value feed and high value products

0.9

0.4

Product Revenue Cash Margin

VR H2

Cash Operating Cost

Indicative Annual Cash Revenues / Costs ($ Billion)

Pitch

1.3

An important cost parameter is the alternative value of feedstock

Uniflex Complex Indicative Upgrading Economics

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Uniflex Complex Indicative Upgrading Economics

Uniflex cases typically offer around a two times uplift in refinery margin, under typical pricing scenarios

0.9

Existing Refinery With Uniflex Project

UniflexCase

Refinery Margin ($/BBL)

UpliftUplift

1.4

MarginMargin

Typically Typically Doubling Doubling

the the MarginMargin

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Recent Uniflex Award Announcement....

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UOP LLC, a Honeywell company, recently announced that its new process technology designed to help refiners get more high-value product from each barrel of crude oil has been selected by an Asian refiner.

The facility, which is scheduled for start-up in 2016, will use Uniflex technology to upgrade its heavy residue into high-value distillate products. Of particular value to the refinery is the high yield of diesel from the Uniflex technology, which is nearly double that of competing residue conversion technologies.

The technology will be integrated with UOP Unionfining hydroprocessing solutions to process distillates into high-quality diesel fuel and naphtha into high-quality feedstock used for gasoline production.

1

2

3

20 40 600

Average Carbon Number (Atoms per Molecule)

Hyd

rog

en

to

Ca

rbo

n A

tom

ic R

ati

o

DIESELDIESEL

VAC RESIDVAC RESID

COKE

Thermal Cracking

� Converting Vacuum Residue into Diesel requires:

− Thermal Cracking

and

− Hydrogenation

− Inhibiting Coke formation

� Uniflex Process achieves all the above:

− In a single slurry bed reactor

− With post treatment to meet finished product quality specifications

Uniflex Process Attributes Recap

Hydrogenation

CRUDEOIL

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Uniflex Process

Summary of the Uniflex Technology Offering

Uniflex Process is...

...a very flexible residue upgrading “Technology Solution”

...offering a step change (improvement) in refining margin

The key global market drivers for refiners are now aligned in support of residue upgrading – falling fuel oil demand, rising clean distillates

demand and high prevailing crude oil prices

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Uniflex Uniflex Technology is a highly Technology is a highly compelling process, that is compelling process, that is

commercially proven, offering commercially proven, offering maximum use maximum use of existing of existing facilities, facilities, and a new industry benchmark in and a new industry benchmark in

““zero zero fuel fuel oil” refiningoil” refining

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Uniflex Process

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