operational flexibility for indian refiners -...
TRANSCRIPT
Operational flexibility for Indian Refiners
7th December, 2016
PetroTech, New Delhi
Sanjiv Singh
Director (Refineries),
Indian Oil Corporation Ltd.
The Growing Prominence of Asian RefiningPlenary Session
Structure of the Presentation
Indian Refining Scenario
Challenges facing Indian Refining Sector
Technological Interventions
Conclusion
2
Indian Refineries
MUMBAI
(BPC 12.0)
(HPC 6.5)
MATHURA
(8.0)GUWAHATI
(1.0)BARAUNI
(6.0)
HALDIA
(7.5)
KOCHI
(9.5 )
KOYALI
(13.7)
DIGBOI
(0.65)
NARIMANAM
(1.0)
MANGLORE
(15)
PANIPAT
(15)
VISAKH
(8.3)
NUMALIGARH
(3.0)
BONGAIGAON
(2.35)
CHENNAI
(10.5)
JAMNAGAR
(RIL 62.0)
(ESSAR 20.0)
TATIPAKA
(0.07 )
PARADEEP
(15.0)
BHATINDA
(9.0)
BINA
(6.0)
4th largest in World
Avg Size : 200000 bpd
Refineries No. MMTPA
IOC Group 11 80.7BPC group 4 30.5HPC Group 3 23.8ONGC/MRPL 2 15.0RIL (Pvt.) 2 60.0ESSAR 1 20.0 Total 23 230.0
Economy of Scale Operations• Dismantling of APM to MDPM started in 1998.
• Phased Capacity Addition for PSU Refys to meet
– Product demand
– Product Quality Upgradation
– Bottom of the barrel upgradation
– Complexity Factor Enhancement
• Operating higher no. of units - higher Opex
• Strategy :
–Capacity augmentation of existing Refys
–New Refys with higher capacity & lesser no. of units
Indian Refineries 23 (PSU-16, PSU JV- 4 and Pvt - 3)
Very Small Refineries =< 3.0 MMTPA 6 (IOCL-Digboi, Guwahati, Bongaigaon
CPCL – Narimannan, NRL & ONGC – Tatipaka)
Medium Refys > 3.0 but < 9.0 MMTPA 6 (IOCL- Barauni, Haldia, Mathura, HPCL- Vizag, Mumbai, BORL)
Large Refineries > 9.0 but < 12.0 MMTPA 3 (BPC-Kochi, HMEL & CPCL-Manali)
Large Refineries > 12.0 MMTPA 8 (IOC- Gujarat, Panipat & Paradip, MRPL, BPC-Mumbai, RIL -2 & Essar)
Coastal Refineries 12
Coastal Refys having direct Crude SPM 5 (RIL-2, Essar, MRPL,KRL, Paradip)
Refys. with crude pipeline >=1000 km 7 (IOCL-Panipat, Mathura, Gujarat, Haldia, Barauni, HMEL & BORL)
5/32
11.30
14.00
11.80
12.20
6.50
10.50
10.00
5.405.70
8.00
5.886.63
7.708.40
10.40
8.10
7.80
5.97
0.00
2.00
4.00
6.00
8.00
10.00
12.00
14.00
0
100
200
300
400
500
600
700
NCImb/d
Refining Capacity & Complexity indicators
CDU capacity (mb/d) Nelson complexity index
All these refineries are lowcapacity & low complexitycompared to world avg.Further, Refineries in North Eastof India are very small capacity
Low Complexity Factor of many Operating Refineries
Need for Capacity Creep & enhancement of Complexity Factor
57%18%
18%
3% 4%
2014
Middle East
Africa
Latin America
North America
Others63%11%
11%
10%
5%
2040
India’s Refining capacity: 230 MMPTA (4.6 mb/d)
PSUs : 135 MMTPA (2.7 mb/d)
Pvt/JVC : 95 MMTPA (1.9 mb/d)
India’s Crude Import Dependency : ~ 81%
India’s Crude Oil Import
3.7 mb/d 7.2 mb/d
Source : India Energy Outlook WEO 2015
Present Policy provides freedom in Crude Import
Refining Sector - Crude Scenario
65.00
67.00
69.00
71.00
73.00
75.00
77.00
79.00
81.00
83.00
85.00
0
50
100
150
200
250
2010-11 2011-12 2012-13 2013-14 2014-15
%MM
TPA
Installed Capacity(MMTPA) Crude Imports(MMTPA)
Domestic Crude Production(MMTPA) Import dependency (%)
Based on consumption
Domestic crude accounted for only 17% of total refinery intake in 2015
-0.5
0
0.5
1
1.5
2
2.5
3
0 5 10 15 20 25 30 35 40 45
Sulf
ur
Co
nte
nt (
%)
API Gravity
India’s crude slate-2015
India Saudi Arabia Iraq Venezuela
Nigeria Kuwait UAE Iran
Angola Colombia Brazil Others
Note: Bubble size represents % Vol
Indian Refining Sector - Current Scenario
Figures as on 1st April of each year
Over the last decade, close to 70 refineries have closed globally, whereas India has grown at CAGR of 6% along with adoption of eco-friendly fuels
127 132149 149
178 185 193213 215 215
230
0
50
100
150
200
250
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
MM
T
Installed Refining Capacity (MMTPA)
2010
Nationwide
2017
Nationwide
2020
NationwideBS III
BS IV
BS VI
Refinery Utilization
Refining Sector - Performance
127141
151161
187196 204
219 222 223
80
100
120
140
160
180
200
220
240
MM
T
Refinery throughput (MMT)
76.473.6
70.7 69 67.865.7
63.2 62.4 61.5 62
50
55
60
65
70
75
80
85
90
MB
TU/b
bl/
NR
GF
Specific Energy consumption (Industry avg)
73.3 73.474
74.475
75.3
76.977.3
77.778.5
72
73
74
75
76
77
78
79
% o
f cr
ud
e p
roce
sse
d Distillate yield
9/32
Source: PPAC/IHS
India Crude Processing ProjectionNeed for Refining Capacity Expansion
230
344
329
348
381
345
478
458
505
0 100 200 300 400 500 600
Current Refining Capacity in India
OPEC World Demand Outlook 2015
IEA Energy Outlook, New Policy 2015
IEA Energy Outlook, Current Policy 2015
India Energy Report 2015
BP Energy Outlook 2015
2040
2030
2015
With growing MS & Diesel growth, India’s Refining Capacity to reach from current 230 MMTPA to about 350 MMTPA (2030) & about 500 MMTPA (2040).
Huge Demand Growth of Transportation Fuel
0
20
40
60
80
100
120
140
160
180
2011-12 2016-17 2021-22 2026-27 2031-32
1524
34
48
706578
104
133
168
MS
HSD
10%
7.1%
7.1%
7.9%3.8%
5.9%
5.1%
4.6%
Gasoline projected to grow faster than Diesel
Poses Challenges to meet growing Gasoline Demand
Diesel : MS : 4.3 3.2 3.0 2.8 2.4
Millio
n T
on
ne
s
11
• India Polymer consumption of 7.6 Kg / Capita far below world avg. 35.
• Polymer consumption accounted 7% CAGR during past 7 years
• Polymer Import tripled in past 7 years, growing @ 18% CAGR
5824 59776293
69707483
8491 87229367
13153
17256
11521275 2160 2500 2435
3180 3125 3737
5.1 5.25.4
5.96.2
7.0 7.1 7.6
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
0
4000
8000
12000
16000
20000
2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2019-20 2023-24
*POLYMER SUPPLY DEMAND TREND IN INDIA, KTA
CAPACITY DEMAND IMPORTS EXPORTS kg / CAPITA
* : Includes LL+HD+LD+PP+PS+PVC+Ex-PS
India fastest growing Petchem Market
Key facts about India’s Refining Margin
• Refinery Margins improved owing to Crude Mix Optimisation, lesser price reduction of refined products vis-a-vis crude oil price and better refinery utilisation (108% in 2015-16).
• Despite increase in HS processing to 71%, Distillate Yield improved to ~ 80% due to improvements in Refining Processes and Technology.
• Indian Refiners moving towards more integrated and complex configuration considering volatile nature of Oil and Gas Market.
• Deregulation of MS and HSD.
• Seamless Integration of Supply Chain across Refinery and Petrochemicals to provide further margin improvement and flexibility.
Challenges for Indian Refiners
High Domestic Demand : highest demand growth
Quality upgradation projects : BS VI by 1st Apr 2020
Economy of Scale : Many refineries are old and small
Crude/Feedstock Flexibility : High dependence on imports ~90%
Maximise Value Addition : Cracks’ volatility & IMO “S” Spec.
Operational flexibility : POL demand fluctuation (SK, MS, HSD),
Integration with PetChem
Stricter environmental regulations : Reduced Emissions
BS VI Gasoline
Sulfur
10 ppm
Olefins
21/18 vol%
RON
91/95
Aromatics
35 vol%
BS VI Gasoline Challenges
Reformate
High Aromatics
FCC gasoline
High Sulfur, Olefins
Isomerate
Low RON
2000
1000
500
150 500
500
1000
1500
2000
2500
1999 2000 2005 2010
pp
m
Year
Sulfur in GasolinePre Bis 2000
BIS 2000
BS-II
BS-III
BS-IV
87
88 88
91 91
85
86
87
88
89
90
91
92
1999 2000 2003 2005 2010Year
RON of Gasoline
Pre BIS
BIS 2000
BS-II
BS-III
BS-IV
95
10
Octane boosting Solution
Meeting LPG demand with 100% 95 RON
Focus Areas for Indian Refiners
Increase in Refining Capacity
Upgradation & Expansion of Existing Refineries
Setting Up Grassroot Refineries
Improvement in Refinery Performance
Refinery Margin Improvement
Energy Efficiency Improvement
Plant Reliability & Maintenance
Operational Excellence
Ensuring Availability of Petroleum Products in India
– Supply Chain Optimisation
– BS-VI Quality Compliance Nationwide by 1.4.2020.
– Infrastructure Development
Technological Intervention
Refinery Configuration/ Complexity Factor Improvement to address
– Changing Feed Stocks : Input cost reduction
• Quality – 0API / Sulfur / Acidity
• Widening of crude basket
– Product Mix improvement : Value addition
• Growing demand with stringent product specs. (BS-VI by 2020)
• Shifting Product demand (From Diesel to Gasoline)
• Bio fuel options
– Upgradation of low value/surplus products
• Naphtha to Petrochemicals
• Black Oil to Distillates
Energy efficiency improvement by use of
– Energy efficient technologies/designs
– Energy efficient equipments
– Best operation and maintenance practices
Bottom of the barrel Upgradation
For further reduction/elimination of black Oil or PetCoke
– Residue ebullated bed /Slurry Hydrocracking
• Technology Selection linked with LSFO vs HSD maximisation
– Integration with Gasification
Heavy crude → Extra residue Current employed technologies in India: Coker - Low Cost major upgrading unit for Indian Refys
Low value PetCoke:Profitable with Crude < 70 USD/BBL
RFCC/INDMAX – Product flexibility with high CCR feed
Solvent deasphalting – Integration with Coker
Fixed/Moving Ebullated Slurry
Asphaltene, CCR ↑ ↑↑ ↑↑
Conversion (%) ↑ ↑↑ ↑↑↑
Status Mature Mature Under demonstration
Resid Hydrocracking
Potential Gasification Feeds & Products
Chemicals Production
GasificationPlant
Natural Gas
Refinery Gas
Vacuum Residue
Pitch
Coal
Pet Coke from Refinery Cokers
Bio Mass Fischer TropschReaction
Combined Cycle
CO2, N2, S
Steam
Electric Power
H2 CO Fertiliser ChemicalsMethanol Acetic Acid
Naphtha Jet DieselWax
Slag for Construction Material & Metal Recovery
Way Forward…
• Capacity Addition with flexible configuration
• Leverage strategic advantage of coastal locations
• Tighter project management for upcoming projects
• Port Infrastructure for additional imports
• Economies of scale for Cost competitiveness
• Gap in domestic petrochemical capacity provides
opportunity for integrated petrochemical complex
• Significant investment required in hydro-treating
capacities to meet planned cleaner fuel norms
• Bio fuels usage to increase
Thank You