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HydrocarbonProcessing.com | JANUARY 2015
®
PROJECT MANAGEMENT
Poor purchasing practices can lead to expensive
project outcomes
ROTATING EQUIPMENT
Dry gas failures are tied to compressor startup problems
RISK MANAGEMENT
New construction planning tools can streamline major capital projects
SPECIAL REPORT:
LNG, NGL
and Alternative
Feedstocks
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JANUARY 2015 | Volume 94 Number 1
HydrocarbonProcessing.com
SPECIAL REPORT: LNG, NGL AND ALTERNATIVE FEEDSTOCKS
39 Maximize LPG recovery from fuel gas using a dividing wall column
M. Bhargava, C. Nelson, J. Gentry and V. Siddamshetti
45 Shale gas drives new opportunities for US downstream
A. Maller, D. Dharia, E. Gbordzoe and N. Lambert
51 Optimize amine sweetening with an optical O2 analyzer
S. Hammond
PROJECT MANAGEMENT
55 Avoid counterproductive project management practices
H. P. Bloch
ROTATING EQUIPMENT
59 Consider technology to reduce compressor vibration and noise problems
Z. Liu
63 Achieve successful compressor startup by addressing dry-gas seal failure
S. Zardynezhad
RISK MANAGEMENT
69 Use a schedule confidence tool to manage project risk
J. L. Shaw
73 Fine-tune monitoring of critical compressors
J. Loeken
PROCESS AUTOMATION AND CONTROL 75 DCS migration: Lessons learned
R. Conley
SAFETY
81 Without reliability, there can be no safety
H. Dutta
Cover Image: Marathon Petroleum completed its $2.2-B, four-year Detroit Heavy Oil Upgrade Project in late 2012. The revamp project increased the Detroit refinery’s heavy oil processing capacity to 100,000 bpd, five times the amount it could process before the project. It is the only refinery operating in the state of Michigan. Photo courtesy of Marathon Petroleum Corp.
DEPARTMENTS 4 Industry Perspectives 10 News 19 Industry Metrics 83 Innovations 85 Events 86 Marketplace 88 Advertiser Index 90 People COLUMNS 9 Editorial Comment Alternative energy? 21 Reliability
Plan now to deal with stressed equipment later
25 Automation Strategies
Control on the wire(less)
27 Project Management
German refinery successfully modernizes safety system
29 Global
State of the US petrochemical/ chemical industry
33 Petrochemicals
Global PE demand growth to drive downstream expansions
35 Boxscore Construction Analysis
Malaysia’s ambitious downstream transformation program
35
4JANUARY 2015 | HydrocarbonProcessing.com
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Keystone XL: It is time to move
forward, Mr. President
In a media call, the American Petroleum Institute (API) president and CEO Jack Gerard emphasized that it is time for the Keystone XL pipeline to move forward, and he requested urgent action by President Obama. In an earlier address, Presi-dent Obama related the embarrassing situation on the US’ progress in developing infrastructure projects as compared to the activity level achieved by emerging economies, such as China. Yet, the presidential administration has continued to delay approving the Keystone XL pipeline for over six years.
Energy security. According to an API report, the Keystone XL project would create $1.1 trillion in private capital invest-ment at no cost to US citizens. From the same study, the pipe-line would provide $120 B to the US economy and create $27 B in government revenue. Mr. Gerard emphasized that the Keystone XL pipeline would create 1.1 MM well-paying jobs and assist in closing the income gap.
US energy renaissance. The US is experiencing an energy renaissance due to developments of shale oil and natural gas. But infrastructures such as pipelines are critical and necessary to allow the US to take a leader position in the global energy market. For example, over 60 LNG projects are under develop-ment with the same export goals.
The US government must take a leadership position on en-ergy to continue the growth of the enen-ergy industry. The “delay-delay” attitude on LNG export facility approvals, pipelines and the lifting of the crude oil ban is hobbling forward progress by US energy companies and the nation.
The US can be a leader in energy exports of LNG and crude oil, but infrastructure is needed to bring these ideas to fruition, according to Mr. Gerard. Other nations are intensely pursuing the same goals on energy exports. OPEC recently announced a hold on its output quota to maintain its share of the global oil markets. Australia is building LNG export facilities with the goal of exporting to Asian markets. Lack of decision adds risk to investment markets, especially for infrastructure projects.
‘Get out of the way.’ The Keystone XL pipeline will eventu-ally be built, according to Mr. Gerard. The project will fortify energy security for North America. National infrastructure projects, such as Hoover Dam and the Golden Gate Bridge, were physically completed faster than the long, drawn-out ap-proval process for the Keystone XL pipeline. It is time to move forward on this pipeline project.
Other news. A new report titled, “The Economic and Budget-ary Effects of Producing Oil and Natural Gas From Shale,” from the non-partisan Congressional Budget Office (CBO), confirms that removing export barriers for US crude oil could incentivize higher domestic production, grow the economy, increase fed-eral revenues and put downward pressure on gasoline prices.
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17–18 March 2015 | Nicosia, Cyprus
Build Business Operations in the
Eastern Mediterranean
A series of recent discoveries by Noble Energy, the largest operator in the region, has increased the estimated gross resources of natural gas awaiting development in the area to 40 trillion cubic feet (Tcf). Industry-leading companies are preparing to increase their regional presence. At EMGC, executives from operators and service and technology companies active in the region will share insight into their experience with this important new resource area. We invite you to join executives and speakers from top operators and regional governments as they discuss key issues and opportunities in the burgeoning Eastern Mediterranean natural gas industry. You’ll be able to use the knowledge you gain, along with the key connections you’ll form at EMGC, to help your company win new business in the region.
Just a few of the Reasons why you Should Attend EMGC 2015:
• Get insight on how your company can profi t in this emerging region• Network with executives actively involved in the planning and development of the region • Get updates on exploration, drilling, pipeline and gas processing projects
• Learn more about what oil and gas operators have planned for off shore Cyprus as well as updates on Israel, Lebanon, Egypt, Jordan, Malta and Greece
• Hear from industry experts about the projected global market impact of the region’s resources • Discover what market and technology trends are driving the development of the Eastern Mediterranean’s natural gas industry
• Explore critical issues like LNG, FLNG, pipeline, resource potential, leasing/permitting, development plans, infrastructure requirements, governmental plans and regulations, and more
Conference Highlights Include:
• Opening night gala dinner featuring a keynote presentation from Charles Davidson, Chairman and CEO, Noble Energy
• Breakfast workshop hosted by Deloitte
• Exhibition fl oor with opportunities to network with companies already established in the region
Visit EMGasConference.com to learn more.
Keynote Speaker:Charles Davidson
Chairman and CEO
2015 Agenda Overview:
Tuesday, 17 March 2015
Session One: The state of the Eastern MediterraneanInvited speakers represent: Noble Energy; Avner Oil Exploration/Delek Drilling; Republic of Cyprus; and Ministry of National Infrastructure, Energy & Water Resources, State of Israel
Session Two: Regional exploration updates
Invited speakers represent: Delek Drilling, Edison International SpA Israel Branch, and representatives from the Governments of Greece and Egypt
Session Three: Regional opportunities and infrastructure challenges
Invited speakers represent: Petroleum Geo-Services; Ministry of National Infrastructure, Energy & Water Resources, State of Israel; Deloitte; and IFP
Session Four: Regional regulatory and legal issues
Invited speakers represent: Herzog, Fox and Neeman; Antonis Paschalides & Co LLC; Cyprus Energy Regulatory Authority; and Nasos A. Kyriakides & Partners, LLC
Gala dinner
Keynote: Charles Davidson, CEO, Noble Energy
Wednesday, 18 March 2015
Breakfast workshop: Hosted by DeloitteSession Five: Gas monetization: Regional economics of development
Invited speakers represent: The Cyprus Institute, Hyperion Systems Engineering Group, Methanex, Technimont, Dor Chemicals, and others
Session Six: Gas export options: LNG/FLNG/CNG
Invited speakers represent: VVT Vasilikos Ltd, GE Oil & Gas, SeaNG, and RSI
Session Seven: Global energy trends: Could the Eastern Mediterranean become a regional supplier? Invited speakers represent: Deloitte, European Commission, Union Fenosa Gas, BG Group, Dolphinus Holdings Ltd and more
Session Eight: The future: Obstacles and answers
Invited speakers represent: Avner Oil Exploration and Noble Energy
Register by 10 February 2015 and SAVE 10%
Registration Type Early Bird(by 10 Feb. 2015) Regular Admission Single Attendee $1,080 $1,200 Team of Two $1,944 $2,160 Team of Five $4,590 $5,100
Visit EMGasConference.com to learn more.
EMGC 2015
Breakfast Workshop
Hosted by Deloitte
The workshop will cover the
challenges that oil and gas
companies will be facing in
setting up and operating in
the Cyprus environment in
the areas of direct taxation,
indirect taxation (VAT),
human capital and other
related operational matters.
The aim of the presenters,
who are all seasoned
practitioners with experience
in the industry and the local
regulatory environment, will
be to guide such companies
on how to navigate the
challenges and optimize their
operational effi
ciency and
related tax cost.
Speaker Opportunities:
Contact Melissa Smith, Events Director at +1 (713) 520-4475 or [email protected]
Sponsorship/Exhibit
Opportunities:
Contact Lisa Zadok, Events Sales Manager at +1 (713) 525-4632 or [email protected] Hosted by:
Lead Sponsor:
Key Card & Welcome Package Sponsor:
Gala Dinner Sponsor:
Bottled Water Sponsor: Bronze Sponsor:
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Editorial
Comment
STEPHANY ROMANOW, EDITOR
Alternative energy is a point-of-refer-ence term. Natural gas is an alternative energy resource for transportation fuels. As more natural gas resources are de-veloped, natural gas is displacing coal as the primary energy source for electrical power generation.
As illustrated in FIG. 1, global energy
resources are a mix of hydrocarbons, re-newables, hydro and nuclear resources. Finding and applying domestic resources for energy is quite logical: Use what is lo-cal and supplement through imports to meet national energy needs. These are logical courses to pursue to expand do-mestic economic growth.
Change is a constant. Environmental
legislation has been a determining factor in future fuel and energy programs. Pserving the environment has initiated re-placing fossil fuels with alternatives such as solar, wind and renewables. It has taken time for alternative energy resources to be developed. Progress is materializing. Here are some recent notable developments:
• The BioTfueL project is constructing two demonstration facilities at Sofiprotéol in Venette, France, and at a TOTAL site in Dunkirk, France. BioTfueL is a thermoconversion process that converts second-generation biomass into biodiesel and biojet fuel. Partners of BioTfueL include IFP Energies nouvelles (30%), Axens (3%), Sofiprotéol (12%), ThyssenKrupp Industrial Solutions (19%), the CEA (5%) and
TOTAL (31%). The partners have committed €180 MM to the project. Almost €110 MM will be invested to construct the TOTAL Dunkirk demonstration unit.
• Neste Jacobs and SunPine plan to construct a Tall Oil Rosin facility in Pitea, Sweden. The Tall Oil Rosin process is a second-generation renewable fuel. The facility will
produce raw tall diesel (a feedstock used in renewable diesel), rosin and tall oil pitch (an energy product for the paper industry). The facility is expected to be operational by the second half of 2015.
• Gevo Inc. has licensed its renewable isobutanol process to Highlands EnviroFuels LLC. The facility will use a “Brazilian-style” syrup mill to produce 200,000 metric tpy of fermentable sugars for Gevo’s isobutanol process.
Other notables. The Institute of
Chemi-cal Engineers awarded recognition to vari-ous companies for their achievements in chemical engineering. The award catego-ries also included innovations in renewable and bioprocessing methods:
BP’s Hummingbird (bio)ethanol-to-ethylene process received the Bioprocess-ing Award sponsored by Newcastle Uni-versity, UK. The process received a highly commended recognition for the Chemical Engineering Project of the Year Award.
Johnson Matthey Davey Technolo-gies received the Sustainable Technology Award sponsored by ABB Consulting for its biodiesel-from-waste-oils process.
INSIDE THIS ISSUE
38
LNG, NGL andalternative feedstocks.
Maximizing the energy potential from carbon and hydrogen atoms is driving new developments in global energy markets. New natural gas supplies are redefining transportation fuels and petrochemical markets, as well as power generation. This special report focuses on gas processing technology solutions and trends.
55
Project management.For many years, reliability-focused engineers have observed flawed procurement processes for mechanical equipment. Many requirements are supposedly aimed at the lowest possible lifecycle cost. The author outlines best practices in designing and purchasing major and critical rotating equipment for capital projects.
69
Risk management.In this case history, a new monitoring system was installed on a critical-service hyper compressor for a Middle East ethylene complex. Downtime for this compressor was extremely expensive for the operating company. A monitoring system was effectively used to prevent catastrophic failures and unplanned downtime.
75
Process control and automation. In 2005, TOTAL’s Port Arthur, Texas refinery, like many existing refining and petrochemical facilities, found itself with an obsolete, at-capacity distributed control system (DCS). The refinery primarily used first-generation equipment that no longer had legacy support from the vendor. This case history explains how the Port Arthur refinery planned and executed an upgrade of its DCS network.Alternative energy?
Shares of primary energy, %
0 10 20 30 40 50 1965 2000 2035 Oil Coal Gas Hydro Nuclear Renewables* *Includes biofuels Source: BP’s Energy Outlook 2035.
FIG. 1. Shares of primary energy by source: 1965 to 2035.
| News
Fuel cells to experience a bright
future due to natural gas
Rising natural gas production is facilitating growth for both stationary fuel cells that provide power to business and the utility grid, as well as for expanding applications in light-duty fuel cell electric vehicles. According to the US-based Fuel Cell and Hydrogen Energy Association (FCHEA), the convergence of abundant natural gas supplies and breakthroughs in fuel cell technologies are finding great acceptance by top automotive manufacturers, such as Hyundai and Toyota. Advanced fuel cells are highly efficient and generate no emissions—only water and heat. Stationary fuel cell applications will use both natural gas and methanol as fuel. Mega-consumer-goods companies, such as Coca-Cola, Apple, Microsoft and Procter & Gamble, are expanding stationary fuel systems for power generation. At present, 2 MM MWh of electricity is generated by fuel cell technology in the US, according to FCHEA.
Photo: The Titan Plant at Methanex’s Trinidad facility. Photo courtesy of Methanex.
HP STAFF / [email protected]
News
How the EU can progress
toward an ‘Energy Union’
The EU has made progress in liberal-izing energy markets, and its global lead-ership on climate change is to be com-mended, according to the International Energy Agency (IEA). However, a new IEA report indicates that there is still room for improvement. Most of the inte-gration of the EU energy market has been confined to northern and western parts of Europe. Until vital interconnections are built across the entire bloc, the EU will not have a truly integrated, single energy net-work—the basis for an “Energy Union.” Moreover, despite reforms at the whole-sale level, markets are increasingly distort-ed by the persistence of regulatdistort-ed prices and rising green surcharges and levies.
In the report, Energy Policies of IEA
Countries: European Union—2014, the
IEA praised the EU for reducing the re-gion’s carbon intensity and taking the lead in vehicle fuel economy standards. Due to 20-20-20 targets and lower en-ergy intensity, an unprecedented boom in renewable energies was possible. EU leaders agreed in October 2014 to am-bitious climate and energy targets for 2030. Now, the legal framework must be put in place, with market rules for a low-carbon (LC) system. The transition to such an LC system remains challenging, as electricity and transport sectors rely heavily on fossil fuels. This requires the swift reform of the EU Emissions Trad-ing Scheme (EU ETS) and support for investments in LC technologies.
EU electricity systems and markets need to accommodate growing shares of variable renewable energy. At the same time, the EU faces the retirement of half its nuclear generating capacity in the next 10 years. Decisions must be made about uprates, upgrades and lifetime exten-sions. Energy security must be placed at the center of the Energy Union. To reduce dependency on a single supplier, the EU must further diversify gas and oil supplies, and it cannot afford to reduce
its energy options: nuclear, coal and un-conventional oil and gas must be part of the mix. Among its key recommended policy actions, the IEA report calls for:
• A new commitment to the internal energy market across the EU, with an interconnected energy network and competitive retail markets to ensure: o Electricity—Market integration
of variable renewable generation with strong coordination of electricity system operation; generation adequacy; and demand-side response, balancing and intra-day markets across interconnected systems is needed. o Gas—Access to, and efficient use of, gas storage and LNG terminals and unconventional gas sources must be developed.
• Timely adoption of market-based and governance rules for an integrated 2030 Climate and Energy Framework with priority to energy efficiency, a strong EU ETS, and sup-port to all low-carbon technologies, by integrating technology, R&D and innovation foresight.
• Enhanced EU-wide cooperation on uprates, safety upgrades and extensions of the lifetimes of existing nuclear power plants to ensure the highest safety standards and regulatory stability needed for the investment decisions in those countries that opt for nuclear energy.
NGVs to displace four
times more diesel
in China by 2020
A new report by Wood Mackenzie fore-casts that natural gas vehicles (NGVs) will be the largest single factor in the substitu-tion of diesel within the Chinese transport sector by 2020. The transition follows similar moves in the industrial and power sectors. Wood Mackenzie estimates that 450 Mbpd of diesel, or 10% of demand, will have been displaced by natural gas be-fore the end of the decade. The influence of NGVs is already being felt in China, with diesel demand weakening through 2014 and a large surplus forecast by 2020.
In 2013, there were about 250,000 NGVs in the commercial sector,
nantly trucks and buses, in China. This displaced around 110 Mbpd of diesel. By 2020, the number of NGVs will increase to 900,000 in the commercial sector—a four-fold increase on 2013 levels.
Despite this level of growth, transpor-tation will remain the smallest compo-nent in China’s booming gas sector—ac-counting for only 8% of demand by 2020 (up from 5% in 2013). In real numbers, however, this results in a trebling of trans-port-related gas demand to 30 Bcm. Fall-ing oil prices are forecast not to curb gas penetration into the transportation sec-tor, as gas prices in China will similarly soften in line with oil pricing through to 2020, based on the government’s natural gas pricing formula.
According to the report, diesel sub-stitution in the industrial and power sec-tors in China will continue. However, the majority of diesel demand in these sec-tors has already been substituted, with only limited opportunities remaining. In contrast, NGVs will account for most of the future diesel substitution due to both domestic market and policy incentives. In 2014, China will experience a decline in diesel demand for the first time in more than a decade. Although NGVs played a part in diesel demand contraction, the ma-jor driver has been more moderate GDP growth, in particular a slowdown in invest-ments, which sharply reduced the call on freight within the resource sectors.
The wider regional impact of gas pen-etration will slow down China’s demand for diesel. However, continued refinery investments will see China emerge as a large diesel exporter in Asia. The strategic choices of Chinese NOCs, which supply the bulk of both oil and gas to the trans-port sector, will increasingly come into focus in light of increased gas penetration and the slowing of refinery investments.
Asia-Pacific is expected to keep its sur-plus in diesel/gasoil (GO) at around 520 Mbpd by 2020. Identifying export market opportunities will become challenging for export refiners in Asia, as they will be marginal suppliers of diesel/GO to Eu-rope and will face a stiff competition from US, Middle East and Russia suppliers.
Wood Mackenzie asserts that the fu-ture pace of diesel substitution will have a material impact on the amount and type of refining capacity required in Asia. NOCs in China and India, which are building new regional refining capacity,
could face an oversupply, especially for diesel, if they fail to balance domestic sup-ply and demand. Therefore, understand-ing the role NGVs play in drivunderstand-ing China’s incremental diesel surplus is vital.
Russia on edge of possible
recession due to problems
over crude oil pricing
Russia may enter its first recession since 2009 as sanctions over the Ukraine conflict combine with plunging oil prices and the weakening ruble. The collective problems are causing domestic economic problems and forcing the government to support banks.
Russia’s GDP may shrink 0.8% in 2015, compared with an earlier estimate of 1.2% growth, according to Deputy Economy Minister Alexei Vedev. The government will spend 39.95 B rubles ($760 MM) to support OAO Gazprombank, and is the third lender to secure a capital injection since US and EU sanctions curbed their ability to borrow.
The economy is succumbing to penal-ties imposed over Ukraine as the plum-meting ruble stokes inflation and a 30% drop in oil prices erodes export revenue. As economic ties with the EU deterio-rate, President Vladimir Putin announced that Russia is scrapping a proposed $45 B Black Sea pipeline to carry gas via Turkey to Europe, thus bypassing Ukraine.
Urals, Russia’s chief export oil blend, will probably average $99/bbl in 2014, a downgrade from an earlier forecast for $104/bbl. The price is forecast to drop to an average of $80/bbl in 2015. Russia needs Brent to average about $100/bbl annually to balance its budget, according to Deutsche Bank AG.
EIA launches new tool for
crude oil import analysis
The Energy Information Agency (EIA) has released the US Crude Oil Import Tracking Tool, which allows policymakers, analysts and the public to more easily track trends in crude oil im-ports. Users can sort and display crude oil imports by month or year, by crude type (i.e., light, medium, heavy), country source, port of entry, processing com-pany, processing refinery and more. The tool features graphing and mapping capa-bilities and a built-in help function.
News
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14JANUARY 2015 | HydrocarbonProcessing.com
News
Recent and forecast increases in domes-tic crude production have sparked discus-sion about how rising crude oil volumes will be absorbed. The primary mechanism for absorbing increased production has been the displacement of imported crude oil, which has fallen from 8.9 MMbpd in 2011 to 7.5 MMbpd in August 2014.
The tool sheds light on the adjustments to imports being made in response to growing production of crude oil within the US. It is one part of the EIA’s ongoing effort to assess the effects of a possible relaxation of present limitations on US crude oil ex-ports, which is another avenue to accom-modate domestic production growth. The EIA is undertaking further work on this larger question, and expects to issue more analysis reports over the coming months.
Launched on the EIA’s beta site to so-licit customer feedback, and to incorpo-rate that feedback into the final release, the new tool represents the EIA’s latest step in making energy data more accessible, un-derstandable, relevant and responsive to users’ needs. The US Crude Oil Import Tracking Tool can be found at: http:// www.eia.gov/beta/petroleum/imports/ browser/. Using the tool yielded the fol-lowing insights regarding recent trends in US crude oil imports:
• Volume and quality of US crude oil imports. Crude oil imports have declined since 2010, with nearly the entire decline occurring in light sweet grades. In particular, US light crude imports fell 71% between 2010 and the period of January–August 2014.
• Source of US crude oil imports. Imports of light crude from Africa, particularly from Nigeria and Algeria, have declined by 93%. • Light crude oil imports by
region. The largest decline in crude
oil imports occurred on the Gulf Coast (PADD 3), down 94%. Light crude oil imports by East Coast (PADD 1) refiners were down 69%, reflecting both their increased use of domestic crudes and modestly lower refinery runs.
• Refinery-level trends in light crude imports. Imports by the 10 largest refineries using imported light crude in 2013 accounted for 55% of total US light crude imports, with the remaining 45% scattered among more than 100 other refineries. The largest source for light crude imports among this group of 10 refineries was Canada, followed by Nigeria and Mexico. Of these 10 refineries, three are located on the East Coast, two in the Midwest, three on the Gulf Coast, and two on the West Coast. • Refinery-level trends in imports
other than light sweet crude. There is evidence that some refineries have recently reduced imports of medium and heavy grades of crude oil to accommodate increasing light domestic
production. Other refiners, which have made changes in processing equipment to accommodate heavier crudes, have increased their imports of such crudes.
UOP to provide
deep-conversion
technologies for Russia’s
oldest operating refinery
The 135-year-old Yaroslavl Men-deleyev refinery will be retrofitted to meet Euro V requirements with UOP’s ad-vanced bottom-of-the-barrel technology suite. Russia’s Mendeleev Group selected
the UOP refining technologies to fully convert crude oil while maximizing pro-duction of high-quality, ultra-low-sulfur diesel (ULSD) to meet growing demand and stricter environmental regulations.
UOP, Mendeleev Group and North-west Production Co. worked together to develop the processing scheme for the new refinery, which will use the most ad-vanced technologies to convert up to 96% of each barrel of oil processed.
UOP will provide all of the upgrad-ing and treatupgrad-ing process technologies for the new complex, which will process 3 MMtpy (65 Mbpd) of crude oil and is scheduled to start up in 2018. The trans-portation fuels produced will meet Euro V fuel standards, which limits the sulfur content in transportation fuels.
The facility will use Honeywell’s UOP Uniflex process and the UOP/Foster Wheeler Solvent Deasphalting process to convert heavy residue to high-quality dis-tillate products, while minimizing co-prod-ucts. UOP’s Uniflex processing technology was developed to help refiners processing the bottom of the barrel, the heaviest por-tions of a barrel of crude (vacuum residue), to higher-value transportation fuels.
The refinery will also use UOP’s Uni-cracking hydroUni-cracking and distillate Unionfining hydrotreating processes to upgrade vacuum gasoil and other feed streams to produce high-quality distil-lates, such as diesel.
Along with basic design services, UOP will supervise the preparation of project engineering documentation in the form of Stadia Proekt, which is re-quired to apply for Russian design and authority approvals.
Growth in large pipe
applications drives
Coriolis flowmeter market
According to a new study from Flow Research, the market for Coriolis flow-meters totaled $1.3 B in 2013, and is pro-jected to grow to almost $2 B by 2018. Growth in the energy markets, especially in oil and gas, is creating greater demand for the accuracy and reliability of Corio-lis flowmeters.
Coriolis flowmeters remain the most accurate flowmeter made, and both ac-curacy and reliability are critically im-portant for measuring the flow of crude oil and petroleum liquids. They are
espe-2013 To tal shipments of C oriolis flo wmet ers w orldwide , $ MM 0 250 500 750 1,000 1,200 1,500 1,750 2,000 2014 2015 2016 2017 2018
s we celebrate our Platinum Anniversary
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16JANUARY 2015 | HydrocarbonProcessing.com
News
cially suited to downstream applications of petroleum liquids.
Another important force driving the market is the development of large-line-size Coriolis flowmeters. For many years, nearly all Coriolis flowmeters were used in pipes with 6-in. diameters or less.
In the past five years, four major sup-pliers have developed Coriolis flowme-ters for use with pipe diameflowme-ters from 8 in. to 16 in. in diameter. While these flow-meters can be quite expensive, they are becoming increasingly popular. Most of these large-line-size Coriolis flowmeters are designed for custody-transfer applica-tions. Companies that have brought out these large-line-size meters include GE Measurement (which acquired Rheon-ik), Micro Motion (part of Emerson Process Management), Endress+Hauser and KROHNE.
Coriolis flowmeters have also ben-efited from industry approvals that pre-viously worked in favor of differential pressure (DP) and turbine flowmeters. The American Gas Association approved a report on the use of natural gas for
cus-tody-transfer applications in 2003. This report helps explain the growing use of Coriolis flowmeters for natural gas. The American Petroleum Institute (API) has also issued a draft standard for the use of Coriolis flowmeters to measure hydro-carbon fluids. This document was added to the API Library in July 2012.
The API also approved a draft stan-dard called “Measurement of Crude Oil by Coriolis Meters.” While Coriolis flow-meters compete with DP and turbine flowmeters for natural gas applications, they also compete with positive displace-ment (PD) flowmeters for downstream measurement of petroleum liquids.
While the use of Coriolis flowmeters is growing rapidly in the oil and gas and refining industries, the chemical industry remains the largest industry for Coriolis flowmeters. Although Coriolis flowme-ters are being used more widely to mea-sure both natural gas and industrial gases, liquids still account for more than 75% of the flow applications.
Even though measurement of the flow of petroleum liquids is growing at
a faster rate than measurement of petroleum liquids, measurement of non-petroleum liquids still represents a larger segment of the Coriolis fluid measure-ment market.
Continued growth in the energy mar-kets is a major reason for projected growth in the Coriolis flowmeter market. At the same time, Coriolis suppliers have shown a readiness to bring out new products to meet changing market requirements.
This is shown in the development of both straight-tube and large-line-size Coriolis flowmeters. While they remain somewhat expensive, the twin benefits of high accuracy and long-term reliability outweigh the upfront purchase price of Coriolis flowmeters for many flowmeter users. The Coriolis flowmeter market size and forecasts are part of a new re-search study from Flow Rere-search, The
World Market for Flowmeters, 5th Ed.
(http://www.flowvolumex.com).
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Industry Metrics
HP STAFF / HP[email protected]
Recent declines in oil pricing and the associated volatility in future pricing has created a difficult forecasting environment. Other factors are causing deviations, especially with regard to the responsiveness of supply under a lower-price environment. The US EIA has cut price forecasts by $15/bbl and lowered its US oil production outlook for 2015.
Pr oduction, Bcfd Gas pric es, $/Mcf 0 10 20 30 40 50 60 70 80 0 1 2 3 4 5 6 7
Monthly price (Henry Hub) 12-month price avg. Production O S A J J M A M F J D N O S A J J M A M F J D N O 2012 2013 2014
Production equals US marketed production, wet gas. Source: EIA.
Monthly price (Henry Hub) 12-month price avg. Production
US gas production (Bcfd) and prices ($/Mcf)
Oil pric es, $/bbl 45 60 75 90 105 120 135 Dubai Fateh W. Texas Inter. Brent Blend O S A J J M A M F J D N O S A J J M A M F J D N O 2013 2014 2012 Source: DOE
Selected world oil prices, $/bbl
Global refining margins, 2013–2014*
WTI, US Gulf Arab Heavy, US Gulf Brent, Rotterdam Dubai, Singapore LLS, US Gulf
-5 0 5 10 15 20 Margins, US$/bbl
Nov 13 Dec 13 Jan 14 Feb 14 Mar 14 April 14 May 14 June 14 July 14 Aug 14 Sept 14 Oct 14 Nov 14
Global refining utilization rates, 2013–2014*
50 60 70 80 90 100 Utilization rates, % US EU 16 JapanSingapore
Nov 13 Dec 13 Jan 14 Feb 14 Mar 14 April 14 May 14 June 14 July 14 Aug 14 Sept 14 Oct 14 Nov 14
US Gulf cracking spread vs. WTI, 2013–2014*
-10 0 10 20 30 40
Cracking spread, US$/bbl Prem. gasoline unl. 93
Jet/kero Gasoil/diesel, 0.05% SFuel oil, 180c
Nov 13 Dec 13 Jan 14 Feb 14 Mar 14 April 14 May 14 June 14 July 14 Aug 14 Sept 14 Oct 14 Nov 14
Rotterdam cracking spread vs. Dubai, 2013–2014*
Prem. gasoline unl., 98 Jet/kero Gasoil, 10 ppm S Fuel oil, 1% S -20 -10 10 20 30
Cracking spread, US$/bbl
0
Nov 13 Dec 13 Jan 14 Feb 14 Mar 14 April 14 May 14 June 14 July 14 Aug 14 Sept 14 Oct 14 Nov 14
Singapore cracking spread vs. Brent, 2013–2014*
-20 -10 0 10 20 30
Cracking spread, US$/bbl
Prem. gasoline unl. 92 Jet/kero
Gasoil, 50 ppm S Fuel oil, 180 CST, 2% S
Nov 13 Dec 13 Jan 14 Feb 14 Mar 14 April 14 May 14 June 14 July 14 Aug 14 Sept 14 Oct 14 Nov 14
78 80 82 84 86 88 90 92 94 96 -1.5 -1.0 -0.5 0.0 0.5 1.0 1.5 2.0 Stock change and balance
World demand World supply 2015-Q1 2014-Q1 2013-Q1 2012-Q1 2011-Q1 2010-Q1 2009-Q1
Supply and demand, MMbpd
St
ock change and balanc
e, MMbpd
Source: EIA Short-Term Energy Outlook, December 2014.
Forecast
World liquid fuel supply and demand, MMbpd
* Material published permission of the OPEC Secretariat; copyright 2014; all rights reserved; OPEC Monthly Oil Market Report, December 2014.
Brent Dated vs. sour crudes (Urals and Dubai) spread, 2013–2014*
Light sweet/medium sour crude spread, US$/bbl
Dubai Urals -4 -2 0 2 4 6
01 July 08 July 15 July 22 July 29 July 05 Aug 12 Aug 19 Aug 26 Aug 02 Sept 09 Sept 16 Sept 23 Sept 30 Sept 07 Oct 14 Oct 21 Oct 28 Oct 04 Nov 11 Nov 18 Nov 25 Nov 02 Dec
An expanded version of Industry Metrics can be found online at HydrocarbonProcessing.com.
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Reliability
HEINZ P. BLOCH, RELIABILITY/EQUIPMENT EDITOR
[email protected]Plan now to deal with stressed equipment later
The US Energy Information Administration’s (EIA’s) “To-day in Energy” brief evaluated how US refineries are process-ing record amounts of crude oil (FIG. 1), with Midwest and Gulf
Coast refineries, in particular, pushing total volumes higher:1
US refineries have been processing record volumes of oil recently. Refinery inputs hit a record high of 16.8 MM bpd in each of the past two weeks, exceeding the previous record from summer 2005. Refineries in the Midwest and Gulf Coast, in particular, pushed the to-tal US input volume upward, as these refiners’ access to lower-cost crude oil, expansions of refining capacity, and increases in both domestic demand and exports contrib-uted to higher refinery runs.
Hydrocarbon Processing believes that record refinery runs
will, to some extent, have an impact on machinery reliabil-ity. Reliability-focused plant operators would, therefore, like to know what steps they should take to ensure uptime under con-ditions of more severe loads on fluid machinery.
Will equipment fail more often? From our vantage point,
such questions are valid; they certainly merit answers beyond the obvious. Industry has to position itself to anticipate and not just react to such issues. By definition, higher loads or through-puts will reduce the margins of safety for some rotating machin-ery. Likewise, for machines previously operating below design throughput, increased throughput can actually cause shifts into more favorable operating regions.
If the original design margin of safety was 2.0 and, with greater load or throughput, it drops to 1.9, there is no adverse effect on equipment life. Conversely, if the design margin of safety was 1.0, then higher loads or throughputs will have con-sequences. The consequences can be calculated with long-es-tablished rules of thumb, which seek to quantify higher rates of erosion, greater loads on bearings, oil temperature increases leading to reduced oxidation life for mineral oils, and a host of similar considerations.
Suppose we tried to anticipate component life reductions as-sociated with a simple load increase of 10% over the base. In using typical rules of thumb for such calculations, we could an-ticipate component life reductions averaging 35%.
Combining turnaround planning and equipment
upgrading. We believe that refineries and petrochemical plants
with elevated throughput should incorporate equipment up-grading as part of the turnaround planning.
A refinery that already knows that plant equipment has oper-ated beyond the customary norm may consider inspection and
repair activities to coincide with already pre-planned downtime events. Fortunately, a bit of research will uncover aerospace-de-rived innovation ([email protected]). Giving thought to the adoption of such innovation will open up previously unavail-able opportunities for the hydrocarbon processing industry.
Inspections and repair opportunities. Depending on the
machines involved, re-thinking inspection and repair downtime would include equipment upgrading. Such upgrading could fo-cus on superbly wear-resistant diffusion-conversion technology used by manufacturing industries, and may include the time and effort needed to accurately define the internal geometry of ro-tating machines for which no certified manufacturing drawings exist. Fully automated 3D measuring equipment may be needed to do such jobs, and many repair centers have such equipment.
Why? Perhaps the original equipment manufacturer (OEM) no longer exists or the equipment was purchased from the pre-owned or surplus equipment market. In that instance, upgrading may reasonably focus on dynamic compressors. On some ma-chines, the surge margin or turndown ratio could be improved. Older fluid machines often consume more energy, and control-ling throughput by simply bypassing or recyccontrol-ling flow is too costly. Discontinuing such bypassing can markedly increase ef-ficiency, as would suitable impeller upgrading and optimization. A good regional repair center should have this type of au-tomated measuring equipment. Higher-performing impellers could be designed and then retrofitted at large regional service centers. Some service centers have full OEM backing or are owned outright by the OEMs. Others have been formed by highly competent individuals or by partnerships, which capital-ize on the technical expertise of their respective staff—often ex-OEM staffers. Strong non-ex-OEM partners often bring together two or more strong competencies in the fluid machinery fields. We have seen cases with know-how and expertise in combining fluid machinery repair with throughput increases or efficiency upgrading. A partnering company may have superior knowledge
0
Jan Feb Mar April
2014
Range and average 2009-13 New record set in July 2014: 16.8 MMbpd
Previous record set in 2005
May June July Aug Sept Oct Nov Dec 13 14 Gr oss r efinery inputs, MMbpd 15 16 17 18 Source: EIA
22JANUARY 2015 | HydrocarbonProcessing.com
Reliability
in impeller fabrication and/or a totally superior solution to the problem of wear. These are companies well worth exploring.
Roles in operations and reliability. One of the key roles of
reliability professionals is to proactively lay the groundwork for the timely implementation of cost-justified upgrades during equipment downtime and turnaround events. The automated measuring of fluid machinery internal geometry would result in an up-to-date data library. From this library and from field
mea-surements such as flow, differential pressure, gas composition, etc., it is possible to predefine impeller or stage upgrade details. The timing for taking automated 3D measurements varies from plant to plant. Such measuring could be done when an unsched-uled unit downtime occurs for reasons unrelated to the fluid ma-chine for which we wish to have accurate geometric mapping in hand. Or, geometric mapping (FIG. 2) could be scheduled as part
of the next turnaround and would coincide with planned visual examination or parts replacement on a particular fluid machine. Knowing the machine’s internal geometry and the field-moni-tored performance would enable a competent machinery up-grader to define, propose, and make detailed plans for revision opportunities. The upgrade components would then be manu-factured and on hand for the next scheduled turnaround.
LITERATURE CITED
1 EIA, “US petroleum refineries running at record levels,” July 24, 2014, http://
www.eia.gov/todayinenergy/detail.cfm?id=17251.
HEINZ P. BLOCH is the Reliability/Equipment editor of HP. The author of 19 textbooks and over 600 papers or articles, he was a senior engineering associate for Exxon Chemicals. He is in his 52nd year as a reliability professional and continues to advise process plants worldwide on reliability improvement, failure avoidance and maintenance cost reduction opportunities. He holds BS and MS degrees in mechanical engineering from the New Jersey Institute of Technology, and he is an ASME Life Fellow. FIG. 2. Geometric mapping at an upgrade shop.
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Automation
Strategies
MARK SEN GUPTA
Senior Consultant, ARC Advisory Group
Control on the wire(less)
Since the industrial revolution, process/industrial control had relied on tightly coupled systems to transmit control signals. Industrial plants have used “modern” control via wired electron-ic signals for over half a century, making the market ready for a new/innovative technology to disrupt the current methods.
Advances in wireless technologies now promise to disrupt that paradigm, and sooner rather than later. Given the ever-in-creasing rate of development (and the inever-in-creasing need to con-nect previously stranded assets), wireless technologies are on the cusp of fulfilling an entirely new range of industrial/process control applications.
Wired control. Since its beginning, industrial/process control
has relied mainly on tightly coupled linkages between the field devices and the control mechanisms. In earlier times, this cou-pling was accomplished mechanically or pneumatically. Recent-ly, industry used wires to convey electrical signals. In fact, most control performed in manufacturing facilities today uses wires to convey signals to and from the field. This generally involves a 4 mA–20 mA signal generated by a measurement device in the field to transmit a process state to the controller, followed by another 4 mA–20 mA signal generated by the controller to convey a desired response to a field actuator.
‘Control on the wire.’ Nearly 20 years ago, Foundation
fieldbus technology led the process industries into the con-cept of “control on the wire.” The concon-cept leverages the higher processing power available in digital (rather than analog) field devices to execute control algorithms and increased speed of digital communications. For example, a digital flow transmitter could execute a PID algorithm based on its own measurement and transmit a control signal to a valve on the same segment. Despite tighter and more robust control and a more reliable setup, only a handful of end users (estimated at less than 5%) have capitalized on this aspect of the technology.
Why not wireless? Wireless signals are generally not used for
control because the sample rates are too long and the signal reli-ability is typically below expectations. PID algorithms expect to sample the field signal at least four times per algorithm execu-tion. When the sample rates are increased on wireless devices, the battery life drops rapidly. This is exacerbated by the gener-ally less-than-ideal reliability of wireless transmission itself. Al-though wireless mesh technology has improved greatly, applica-tions must still be able to tolerate a loss of signal.
Moving by leaps and bounds. The foundations are set.
Wireless standards are fairly well agreed upon, with committees working on convergence. This allows suppliers to focus on
de-velopment to a specific standard without the overhead of hav-ing to support multiple standards.
Energy harvesting currently allows wireless transmitters to use “free” energy from the surrounding environment to augment power to the device. These devices convert vibration, solar or thermal energy into electricity to power wireless devices in loca-tions where line power is not available. In some cases, the wire-less device works totally off the energy harvester and uses the battery only for backup.
Wireless control. A leading global automation supplier
re-cently announced that it had developed an augmented PID al-gorithm to handle the longer sample rates and uncertainty in communication associated with wireless process variables. The new algorithm has added signal conditioning to handle this lon-ger sample time. The company donated the patent for the new algorithm to the FieldComm Group. This means that control can be implemented using wireless input signals, and the tech-nology can be licensed from the same organization responsible for Foundation fieldbus.
Changing the game. As with many new developments for the
industrial world, efforts to extend battery life continue to be pro-pelled by advances initially developed for the consumer market. These advances will enable faster wireless communication be-tween field devices without concern for battery life and associat-ed maintenance. When couplassociat-ed with increasingly efficient energy harvesting, battery life may cease to be an issue in the near term.
When considering the amount of development dollars being invested in wireless vs. wired technologies, end users should ex-pect wireless to quickly become faster, more reliable, more fault tolerant, and more energy efficient. WirelessHART currently claims 99.9% end-to-end reliability. Suppliers that support the ISA 100 wireless standard also report increasing reliability. ARC Advisory Group believes that wireless technology will not only get better, but it will also become easier to implement and use.
Is control in the wireless mesh realizable? ARC believes that the answer is “yes.” Although wireless communication reliability is still somewhat questionable, the building blocks are in place to alleviate these concerns.
MARK SEN GUPTA is a senior consultant and leads ARC’s coverage of process automation and automation supplier services. He also covers topics in process safety and SCADA. Mr. Gupta has over 24 years of expertise in process control, alarm management, SCADA and IT applications. He holds BS and MS degrees in electrical engineering from Georgia Institute of Technology.
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Project
Management
T. ROMAHN, Heide Refinery-Klesch Group, Hemmingstedt,
Germany; and M. CISLER, HIMA Paul Hildebrandt GmbH, Brunsbüttel, Germany
German refinery successfully modernizes safety system
In September 2014, the Heide refinery in Germany used two weeks of planned downtime at its pyrolysis plant to migrate to new safety systems. The new system emphasized high plant/ equipment availability and investment security, while also guar-anteeing a smooth changeover.
The refinery. The Heide refinery is an enterprise of the Klesch
Group, and it employs approximately 500 people. The company has a processing capacity of 4.5 MMtpy of crude oil. The refin-ery was built in 1940, and produces classic mineral oil products, such as automotive gasoline, diesel and jet fuel. In addition, the refinery produces light heating oil along with base materials for the chemical industry.
This refinery is Germany’s northernmost facility. The pyrol-ysis plant is one of the important process areas. As part of an ex-tensive distributed control systems (DCS) replacement project, the Heide refinery also planned replacing the pyrolysis plant’s 20-year-old safety technology with a new system.1
Investment security is a key concern. Plant availability
is especially important to the Heide refinery. In the pyrolysis plant, process changes are undertaken frequently. These chang-es or conversions need to happen quickly and seamlchang-essly during plant operations, without impairing plant safety.
The new safety system is designed for medium- and large-sized applications.1 All changes, upgrades, maintenance and
proof tests can be executed during normal operation. Due to the system’s high performance, extensions are possible. For ex-ample, safety-relevant functions of the propylene drying unit planned for 2015 can also be integrated into the control system. The refinery also wanted a state-of-the-art, safety platform with a long product lifecycle that can be easily extended.
Easy integration. In the pyrolysis plant, three redundant
safety systems are used as emergency shutdown (ESD), burner-management system (BMS), and fire and gas (F&G) systems in the compressors, the naphtha and ethane furnaces and in other process units. The new process control uses Ethernet functions to safely manage approximately 2,000 signals.
Integration of the safety systems involved parts from the previous process control system.2 Various signals from the
con-trollers were required for more complex regulating tasks in the control system (FIG. 1). It was necessary to integrate the safety
system with different control systems. The couplings were ex-tensively tested before the installation so that commissioning would run smoothly.
For the migration, most of the existing marshaling racks were retained; this measure reduced procurement costs, as well as installation, wiring and test efforts. Because the existing
con-trol cabinets would be reused, the old CPUs, I/Os and module racks were completely removed from the installed swing frames, and new module racks for the CPU, network, MODBUS and I/O were integrated in the freed space. The terminal blocks in each control cabinet were defined as transfer points.
Extensive, up-front tests. The tight timeframe for the
con-version was the main challenge. The installation had to be completed during a 14-day turnaround. Seven existing safety controllers had to be connected to three new safety systems. In recent years, the responsible parties at the Heide refinery had gained experience in other projects. This included checking and testing as much as possible in advance.
The vendor was charged with hardware planning and system programming. To ensure that the specifications were correct, safety experts conducted an intensive appraisal on site. Photos of the cabinets and terminals were taken, along with extensive documentation of the project. Heide refinery service engineers supported the installation.
Next migration. The safety controllers that process a total of
approximately 7,500 I/Os have been in use at the refinery for more than 40 years.3 Due to the positive experiences over many
years and the numerous advantages of the systems, the next migration project—the refinery’s power plant—will also be implemented with safety solutions from the same vendor.3
NOTES
1 HIMax systems from HIMA Paul Hildebrandt GmbH.
2 TDC 3000 and the Experion PKS system, both from Honeywell, were
imple-mented via MODBUS RTU and MODBUS TCP/IP.
3 HIMA Paul Hildebrandt GmbH.
FIG. 1. The new controllers at the Heide refinery serve as ESD, BMS and F&G systems to ensure safety and plant availability. The safety controllers in the pyrolysis plant process manage approximately 2,000 signals.1 Source: Heide refinery.
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Introducing
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