By Shell Catalysts & Technologies on Aug 31, 2020
Refineries in the East Asia region have adopted innovative and strategic revamp projects to remain competitive through market challenges. These include South Korean refineries, which are among the largest refineries by capacity in the world.1 Revamps have been essential for these refineries to respond to changing market demands while also meeting regulatory and environmental fuel specifications.
Recently, three refinery revamp projects have been successfully implemented by Shell Catalysts & Technologies in the region and can be applied to refineries around the world.
Producing winter-grade diesel that meet Euro 5 and Euro 6 specifications
How can production for winter-grade fuel oil be increased while also meeting Euro 5 and Euro 6 emission specifications?
Normal diesel that is used in temperate climates has long-chain paraffins that freeze in low temperatures. A technology called diesel dewaxing must be used to change the hydrocarbon molecule structure and improve the cold flow properties of diesel.
Reactor internals revamp to increase select catalyst volume
For our first revamp with a refinery to increase winter-grade diesel production, our experts assessed the refinery’s existing assets and recommended revamping a diesel hydrotreater to increase the volume of select catalyst.
A reactor internals revamp would allow the refinery to increase the reactor’s capacity without having to build a new reactor. In a reactor, there are different beds, or sections, for catalyst. By installing latest-generation reactor internals, we were able to create an additional bed in the hydrotreater.
Our experts modified one of the beds to treat a type of catalyst that uses the zeolite component for paraffin dewaxing. With new reactor internals, we were able to separate a reactor into two beds to add a higher volume of active catalyst while also adding another layer of dewaxing catalyst.
Increasing the hydrotreater’s capacity presented not only technical challenges, but regulatory compliance challenges as well. Producing an additional grade of winter-grade diesel while meeting Euro 5 and Euro 6 fuel specifications for sulphur content required creative ways to insert an additional layer of catalyst.
With our experts’ extensive knowledge of catalyst, we were able to recommend catalyst that would reduce the hydrotreater’s emission of sulphur, nitrogen and CO2. The combination of new reactor internals and catalyst allowed the refinery to maintain compliance with the Euro 5 and Euro 6 specifications while also producing more winter-grade diesel.
Shifting to a heavier, lower-cost crude blend
Hyundai Oilbank identified an opportunity to improve margins at its Daesan, South Korea refinery by moving from a medium-sour Middle East crude blend towards super-heavy crudes such as Maya and Basrah Heavy. These low-priced crudes can provide high margins but are extremely challenging to process.
To enable such a crude slate while minimising capital investment and maximising returns, Hyundai Oilbank involved Shell Catalysts & Technologies to assist in a series of changes to the refinery configuration in a carefully designed combination of adding new hardware and revamping existing assets. The changes include:
- Installing a new C5 solvent deasphalting (SDA) unit (a residuum oil supercritical extraction, or ROSETM, unit licensed by KBR);
- Converting atmospheric residue desulphurisation (ARDS) module 2 to deasphalted oil (DAO) mild hydrocracking (MHC) service to process 100% DAO from the SDA unit;
- Revamping the delayed coker to enable it to process pitch from the SDA unit instead of vacuum residue and
- Revamping the ARDS module 1 to increase capacity.
One of the key constraints for processing a more difficult crude slate had been the maximum allowable metals content that the existing ARDS modules 1 and 2 could process. The new configuration lifts this constraint significantly for module 2 because the SDA unit concentrates the crude impurities, such as sulphur, nitrogen and metals, in the asphalt stream that is routed to the delayed coker.
Explore residue upgrading technologies
A phased approach
During Phase 1, Hyundai Oilbank revamped both ARDS modules:
- ARDS module 1 was revamped to process 50% more AR above original design, at 20% conversion, producing residue fluidised catalytic cracker (RFCC) feed (0.5% sulphur, 4.5% micro-carbon residue).
- ARDS module 2 was converted to MHC service and the capacity increased by 50% above original design, processing 100% DAO at 50% conversion. It produces feeds for the existing RFCC and the future petrochemicals complex.
In addition, Hyundai Oilbank installed a new C5 SDA unit, the largest-capacity ROSE unit ever licensed by KBR, and revamped the existing delayed coker to enable co-processing VR and ROSE pitch feed.
In order for the project to begin to generate returns, speed of implementation was also important. It took the Hyundai Oilbank and Shell Catalysts & Technologies project team just 30 months from the beginning of the feasibility study to startup.
In 2018, Hyundai reported in its annual report that it has the nation’s highest heavy oil upgrading ratio, and in 2019 it posted in its annual report the industry’s highest ratio of net income to sales. The Phase 1 project, which concluded in 2018, was a key contributor to these achievements.
During Phase 2, Hyundai Oilbank further revamped the ARDS module and MHC unit:
- ARDS module 1 was revamped from a single train to two parallel trains and added more fixed-bed reactors, which increased capacity by an additional 30% and the cycle length by 50%.
- The MHC was revamped by adding more fixed-bed reactors, which increased capacity by an additional 10% and the cycle length by 50%.
Enabling the processing of super heavy crudes has helped Hyundai Oilbank to unlock a major improvement in its refining margin. Crucially, it achieved this for only modest capital investment by leveraging revamps.
For this phase, it took just 20 months from starting the feasibility study to starting up the revamped unit. These changes also enabled the refinery to be further integrated with a new heavy feed petrochemical complex that was being built.
Preparing for refinery and petrochemical integration
For years, the refinery industry has been discussing refinery and petrochemical integration. The future for refineries is likely to be in producing chemicals.
Some refineries in the East Asia region have been able to use low-cost feedstock, which they process and convert to DAO. DAO is used as feed for ethylene crackers to produce chemicals; it is a cheaper chemical feedstock compared to naphtha or liquified petroleum gas.
We are also working with a number of refiners on how to process very heavy bottom feedstock. Through a feasibility report, we showed how a revamp can help them to produce both IMO 2020 compliant fuel oil as well as chemicals. Several South Korea refineries are already investing and constructing ethylene oxide crackers with a 2021 start-up target.
Shell Catalysts & Technologies’ expertise as owner-operators
We are proud to work with refineries around the world on revamp projects. Our experience as owner-operators allows us to apply our knowledge in licensed technology and catalyst from Shell refineries to service third-party customer sites.
Looking forward, the next challenge for many refineries will be maintaining compliance with the revised European Union Emissions Trading Scheme in 2021, which outlines targets for emissions cuts by 43% compared to 2005 levels.2 We plan to continue helping our partners find opportunities to evolve into new energy areas and to conserve and make better use of energy.