Residue gasification is gaining attention because it offers refiners the opportunity to convert the deepest bottom of the barrel into valuable products such as hydrogen, petrochemicals, power and steam. In the past, some operators may have dismissed it as being too capital intensive, but, at a time when refiners have no option but to invest in some kind of residue upgrading technology, the economic case for residue gasification can be extremely compelling.
As tighter bunker fuels specifications will come into force in just over three years from now, few refiners can afford to continue deferring an investment decision. Refiners that need to install bottom-of-the-barrel upgrading technology must launch those projects now in readiness for the closure of the main outlet for heavy residue.
Those that already have a gasification unit are in an enviable position. They may just need to debottleneck it to enable it to process heavier feeds. Those that do not, however, face a much higher investment hurdle. As discussed in The Bunker Fuels Challenge: How should you respond?, they will have a wide range of technologies to evaluate, but residue gasification is likely to score highly in those economic analyses, chiefly because:
- it can process a wide range of low-value refinery streams, including heavy residues and asphaltenes. Whether it is vacuum residue, hydrocracker bottoms, severely thermally cracked residue or highly viscous asphalt from an SDA unit, a gasification unit can handle it.
- it produces a wide range of high-value products. The synthesis gas (syngas) it produces has a range of high-value uses. It can be used for hydrogen manufacturing, power and steam generation, and as a petrochemicals feedstock.
- it does not produce high-sulphur fuel oil or coke. Unlike other residue upgrading technologies, gasification is a complete residue disposal solution.
- there is a wide range of secondary benefits. For example, it can help to unlock the use of heavier, lower cost crudes and to reduce plant emissions. In addition, as it produces hydrogen, some projects can discount the capital cost of a hydrogen manufacturing unit.
Often, the most effective solution will be to combine the gasification unit with another residue upgrading technology, such as a deep thermal cracking process or, more recently, SDA. SDA will produce a low-contaminant deasphalted oil (DAO) and pitch (asphalt). The DAO has a relatively high hydrogen content and is suitable for hydrocracking. The pitch, which contains most of the residue’s contaminants, including metals (nickel and vanadium), asphaltenes and Conradson carbon residue, provides a low-cost gasifier feedstock.
Sites that have a gasification unit but not an SDA unit are likely to find that the economics of adding an SDA unit to the line-up are highly attractive, and that their gasifier can handle the heavier stream with only some minor modifications.
At Shell Global Solutions, we have made some important improvements to our gasification technology, the Shell Gasification Process (SGP), in recent years. For example, we have successfully driven down the capital cost of our designs and increased their reliability. We have been able to expand the feed window to enable the use of high-ash feedstocks and residues, for example, residues that have been so severely thermally cracked that they could not be blended back to stable fuel oil and high-viscosity asphalt from an SDA unit.
These improvements mean that residue gasification, especially in combination with SDA, offers an extremely compelling investment opportunity for many refiners looking to adapt their assets in light of the pending changes to bunker fuels specifications.