Introduction: The process of producing valuable Petroleum Products from Crude Oil is termed as Oil Refining. Refining is a complex engineering application which involves both Physical and Chemical processes for converting crude oil into useful products. Oil Refinery is the industry where the refining of Crude Oil takes place and it is converted into petroleum products. These products have various applications like Domestic (LPG & Kerosene), Commercial (Heating oil, Petrochemical Feed, Lube Oil) & Transportation (MS, ATF & HSD). Refining involves almost all aspect of Engineering and a continuous R&D for developing the Refining Technology. Since, first discovery of crude oil in 19 th century, world has seen enormous changes and development in field of Refining Technology. Refineries are classified based on their complexity and capability to process different grades of Crude Oil. Raw Material: The only raw material for an Oil Refinery is Crude Oil. It is also called Black Gold due to its value in commodity market. With increasing industrialisation, the energy demand of the world has increased drastically leading to major surge in demand of Crude Oil as it remains to be most compatible and cheap source of required energy and feed stock for downstream Hydrocarbon based industries. Crude Oil is classified based on its Origin, Physical & Chemical Properties. Major Oil producing nations are part of an organisation called OPEC that regulates the Oil scenario across the Globe. The major oil producing Nation are Saudi Arabia, Iraq, Iran, Libya, Nigeria, Venezuela. Other countries also produce Oil but comparatively in lower quantity. Crude Oil is produced by Oil Exploration companies like Shell, Chevron, Total, BP, Cairn Energy with help of Operators like Schlumberger, HLS etc. Indian Companies, which are involved in exploration & production, are ONGC, OVL, OIL, RIL. Oil exploration and producing involves, developing the oil fields, which are found to have a proven reserve. Oil fields are either on land or in Seas. It is a risky operation, which has developed, vastly in recent past. Exploration & Development of Oil & Gas fields involves huge investments and requires very skilled persons to give fruitful results. Crude Oil is Blackish Brown liquid, which is a mixture of various hydrocarbons. These Hydrocarbons are separated in a refinery based on their Boiling Point and these separated hydrocarbons form group of products based on their properties. Crude Oil is measured in terms of Barrel (159 Lts), which is the traditional way, and still continues to be followed across the world. Article by Mr. Abhinav Sigatia Page 1 of 5
Classification of Crude Oil Refining of Crude Oil - Process a) Based on Origin: Middle East, West African, Far East, North Sea, South American etc. b) Based on Properties: 1) Specific Gravity Measured in Term of API. 2) Sulphur Content High, Moderate & Low Sulphur 3) Acidity High TAN (Total Acid Number) & Low TAN 4) Other properties like Viscosity, Metals, Asphaltenes, and Nitrogen. 5) Distillate Yield White Oil content. In an Oil Refinery apart of Crude Oil other material used are utilities like steam, power, catalysts and chemicals, which are part of processing requirement. But, crude oil is the only raw material of a Refinery and constitute to 90-95% of total input cost. Refining Process: The crude oil is processed in a refinery to produce various hydrocarbon products like LPG, Naphtha, Petrol, Kerosene, ATF, Diesel, Furnace Oil, Lube Base Oils etc. The complexity of refinery depends upon the factor that to what extent it is able to produce white oil called Distillates and its ability to process difficult crude like Heavy, high sulphur, high acidity and other properties which will lead to either handling difficulties or processing problems like corrosion. Various equipment which forms a Refinery are Distillation Columns, Reactors, various type of Heat Exchangers, Pumps, Compressors, Boilers, Control Valves, Instrumentation, Advanced electrical & electronic applications and power equipments. Refining Process involves: a) Primary Process The primary process involves Primary unit called Crude Distillation Unit (CDU) where separation of various hydrocarbon streams based on its vapour pressure takes place. A Refinery with only CDU is Topping Refinery. To increase the complexity in Primary unit a Vacuum Distillation Unit (VDU) is put in series of a CDU to separate Hydrocarbon from Crude Oil into more and more streams which are valuable in one form of other in a refinery. Heated Crude Oil enters the CDU column and it is separated into Straight run products like LPG, Naphtha, Heavy Naphtha, SK/ ATF, HSD and remaining heavy part is Reduced Crude Oil (RCO) or Long Residue which forms feed to VDU. Heated RCO, is charged into VDU where it is separated into Vacuum Gas Oil (VGO) and Vacuum Residue (VR) b) Secondary Process These process accounts for complexity of Refinery and these Refining processes are classified based on the process involved. Article by Mr. Abhinav Sigatia Page 2 of 5
Hydro treating processes are involved in removal of elements like sulphur, nitrogen from the various separated stream using Hydrogen. These are important processes as without these the various streams separated from crude oil though valuable cannot be marketed, as they don t meet the environmental norms. Like Diesel from CDU is treated in Diesel Hydro-treater to remove sulphur, Naphtha is desulphurised before it can be further treated in Reformer to produce Petrol or Hydrogen. Heavy Streams like VGO & VR are also hydrotreated based on type of refinery configuration. The other type of process is Cracking process where heavy products having long chain Hydrocarbons like VGO & VR broken into smaller chain hydrocarbons which are distillates and are more valuable. Various cracking process are thermal cracking, catalytic cracking or hydrocracking. VGO is converted into lighter components using catalytic cracking or hydrocracking. VR is thermally cracked in Vis Breaker or Coker to further break long chain Hydrocarbons in smaller chains. The third type of process is of extraction, which is performed is to separate hydrocarbon based on its type that is Paraffins, Naphthenes or Aromatics. These processes are important during production of Lubricating base oil in Lube refinery. Also from VR, Asphalt (Bitumen) is produced using De-Asphalting process. Other treating process in refinery are Amine treatment of Gases, Merox treatment etc, which are involved in various stages of refining. All these process involved in refining have evolved as energy demand has increased. Development of new catalysts, new processes of Cracking and treatment process have come up from various licensors like Chevron, UOP, Shell, Conoco Philips who have huge R&D facility across the world, which have continuously changed the face of the Refining Industry. The various process designers are involved in designing of Process equipment and allied instrumentation so as whole process plant can be operated in an efficient manner. Design of plant is a specialised engineering job done by vendors like Technip, Foster Wheeler, EIL etc. Utilities: Operation of Refinery is not possible without Steam, Power and Heating requirement in Furnaces. The energy requirement to run a refinery is met from the crude oil itself. 6-10% of crude oil is internally used for production of Power, Steam and to heating source in Furnaces. With stringent emission norms, Natural Gas is now being used as Refinery Fuel used for internal energy consumption of Refinery. Article by Mr. Abhinav Sigatia Page 3 of 5
The off gases produced in refinery are used in Heating Applications. Hydrogen Sulphide produced during hydro treating of various hydrocarbon streams is processed in Sulphur recovery plants to produce elemental Sulphur. Water effluents are treated in Effluent treatment plants and Tertiary treatment plants to reprocess the water and prevent any discharge in water bodies as part of environmental saving measure. Logistics & Planning Oil Movement & Storage is the key area for any Refinery. All Hydrocarbons in a Refinery whether its Crude Oil or Intermediate Streams from Process units or Final Products have to be stored in designated Tanks and are transferred within Refinery through Pipelines. There is a web of Pipelines within a Refinery. Various Streams from Process Units are blended in respective product pools to form batches of Products. Then these Products are despatched to Customers from OM&S area. The Refinery operation is optimised using Planning for Feed stock purchase, Scheduling of Crude & Units, Resource utilisation and deciding the Product pattern based on prevailing Product demand and Pricing. For Optimisation of Operation various Computer based applications are used for decision-making process. Products & Marketing: The various products produced in a Refinery can be classified as Straight run products and Blended Products. Products like LPG, Naphtha and Kerosene are directly routed to their respective storage tanks from various production units. Products like Petrol, Diesel and Furnace Oil are produced from various streams from different units. These streams are blended in desired ratio to form the specified product. Individual streams may not meet all the specification of the product. Various Products of a Refinery (Depending upon configuration) are: 1) Liquified Petroleum Gas (LPG) 2) Petrochemical Feed Stock (PCFS) LPG Derivatives 3) Naphtha & Derivatives 4) Motor Spirit (Petrol) 5) Aviation Turbine Fuel (ATF) 6) Superior Kerosene Oil (SKO) 7) Diesel (HSD) 8) Furnace Oil (FO) 9) Lube Base Stock 10) Extracts 11) Asphalt (Bitumen) 12) Wax 13) Sulphur Article by Mr. Abhinav Sigatia Page 4 of 5
14) Pet Coke The products can be further classified based on their usage Commercial or Bulk and for Retail or Domestic customers. Fuels like LPG, Kerosene, MS & HSD, which are used by general public, are sold through Retail Outlets or PDS supplies. Other products like PCFS, Naphtha, ATF, FO, Asphalt etc are sold to commercial establishments as they are used as raw material or an energy source for the industries. Pipelines transport the products from Refinery to Marketing Terminals from where it is transferred to Customers or other terminal by Rail Road, Cross Country pipelines or Trucks. Ships are also used for transportation of products between port locations. Economics of Refining The pricing of Crude & Petroleum Products is based on International trading price at various Commodity Exchanges like NYMEX. These quotes are published daily in Platts or Argus from which quotes are taken for fixation of Crude and Product price. The value addition done in a Refinery is called Refinery Margin. The Gross Refinery Margin (GRM) = P v - C c P v Value of Products Produced C c Cost of Crude Oil The other cost involved in Refinery are Maintenance cost, Administrative expenses, Salaries & Wages etc. After subtracting these cost Net Margin is computed. To enhance the Margins of a Refinery it is important to reduce the Cost, Produce more value added products and distillates. Since, Crude Oil forms the major cost (around 95%) it is very important to select right type of crude oil according to Refinery configuration and at correct price. Hence, overall Planning and Economics working is very important in a Refinery. Refinery not only is about sophisticated Technology but also about managing the entire resources for maximising the returns. Energy Sources are Valuable, Together We Can Make Future Bright by Saving Them By: Abhinav Sigatia: Education: B.Tech Chemical Engineering, NIT Trichy Work Experience: Engineer, Production Planning at Chennai Petroleum Corporation Limited. Article by Mr. Abhinav Sigatia Page 5 of 5