Shifting industry trends are set to challenge refiners’ current destinations for light cycle oil (LCO). Those that use it as a cutter stock for marine bunker fuel will find it unsuitable when the sulphur specifications tighten. Those that export it to countries that still allow high-sulphur diesel will find that, as clean fuel regulations gather pace in developing countries, these outlets will shrink too. Soon, depending on their assets and the markets they serve, many refiners may find that the most attractive solution is to upgrade LCO in an existing hydrodesulphurisation (HDS) unit using aromatic saturation technology. Here is why.

In recent years, aromatic saturation has emerged as a valuable, low-cost margin improvement opportunity. Several refiners have revamped an existing low- or medium-pressure hydrotreating unit to add enhanced or deep aromatic saturation (EAS/DAS) in order to upgrade LCO to ultra-low-sulphur diesel (ULSD).

Their principal driver was to improve margins. Upgrading even a small proportion of LCO can have a major impact. For example, if the LCO upgrade margin was $66 per tonne1 in atmospheric gas oil, then increasing the co-processing of LCO by 5% in a typical 100-t/h unit would increase margins by some $2.8 million per year.
1Basis: The 12-monthly average from January 2015 to December 2015 = 1.6 vacuum gas oil versus atmospheric gas oil (NWE price).

However, additional incentives for refiners to upgrade more LCO are emerging. These are:

  • tightening marine bunker fuels specifications. LCO has long been an attractive blending component for high-sulphur marine bunker fuels. But, as discussed in The Bunker Fuels Challenge: How should you respond?, those specifications are tightening, so LCO will need to be upgraded to a more valuable product.
  • the global clean fuels push. Some refiners in developed countries export LCO, along with other difficult distillate streams, to countries that allow higher sulphur levels in road and off-road diesel. However, almost all the developing countries are in the process of adopting <50- or <10-ppm-sulphur diesel specifications, so that will soon no longer be an option.

In the future, therefore, refiners may need to desulphurise their LCO. However, its composition is such that it is difficult to achieve the required cetane and density specifications in a standard low- or medium-pressure hydrotreater.

Consequently, there are three main LCO upgrading options:

  • hydrocracking. This option can meet the cetane and density specifications, but it generates an excessive amount of naphtha, which is undesirable in many markets (however, for refiners that serve gasoline-focused markets such as the USA, distillate mild hydrocracking may be preferable; for more on this, see Distillate Mild Hydrocracking). Hydrogen demand and, therefore, the operating costs would also be high.
  • high-pressure hydrotreating. This would improve the cetane and density properties close to the specifications, thereby enabling LCO’s use as a ULSD blending component, and there would be less yield loss compared with hydrocracking. However, this option is also hydrogen intensive.
  • low- or medium-pressure hydrotreating with a line-up that includes EAS or DAS. This would bring the density and cetane also relatively close to the specifications; however, the yield loss and operating cost would be the lowest of the three options.

So what are EAS and DAS? These techniques involve dedicating either a bed or an additional reactor for operation in a slightly different temperature regime to ULSD production. This way it can function in the aromatic sweet spot that enables the saturation of almost all of the aromatics.

Single EAS and two-stage DAS configurations.
Figure 1: Typical EAS/DAS configurations.

As shown in Figure 1, various schemes can be used, including:

  • single-stage EAS. One or two beds of a ULSD unit are deployed for lower-temperature operation. The HDS and hydrodenitrification reactions occur in the lead beds. Aromatic saturation in the later bed improves the cetane, density and aromatics. Latest-generation base metal catalysts are vital, as are the quenches.
  • pseudo two-stage EAS. For even higher upgrading, a two-stage configuration can be employed, again with latest-generation base metal catalyst. The first stage prepares a ULSD feedstock, an inter-stage stripper removes the hydrogen sulphide and the ammonia, and the stripped liquid is recombined with clean treating gas to complete the aromatic saturation reactions.
  • two-stage DAS. This uses a similar configuration to two-stage EAS, but with a noble metal catalyst for deeper saturation and an improved yield profile. Greater amounts of LCO can be processed and extremely low aromatic specifications, such as those in force in Sweden and California, USA, can be achieved.


Evaluating different EAS and DAS schemes

The configuration that is optimal for one refiner may be suboptimal for another. To demonstrate this, we have devised three fictional, representative scenarios.

In Scenario A, the refiner requires a new HDS unit to treat a severe feed that is high in aromatics and low in cetane. As it is a new unit, it can be designed with a bed dedicated to low-temperature operation. The product qualities that this line-up achieves are very high.

In Scenario B, capital constraints mean building a new unit is not an option; evaluations reveal that the existing low-pressure HDS unit could be revamped to upgrade LCO by adding a pseudo two-stage EAS reactor. The product meets typical density and cetane ULSD specifications, and the payback period would be just two years.

The refiner in Scenario C needs to co-process a larger proportion of LCO. This amount of upgrading could be achieved in a new low- or medium-pressure HDS unit with DAS using a noble metal catalyst instead of a base metal one. This achieves far higher improvements in aromatics, density and cetane, but it is also a more hydrogenintensive process with a higher capital cost. Nevertheless, the payback time for this new HDS/DAS unit would still be very attractive.



Sulphur specification, ppm <50 <10 <10
Proposed feed ratio 16 LCO:35 residue desulphurisation gas oil:49 light gas oil 15 LCO:30 heavy gas oil:55 medium gas oil 40 LCO:60 heavy gas oil
Reactor inlet pressure, bar 88 52 73
Type of project New build Revamp Revamp
Solution Single-stage EAS Pseudo two-stage EAS Two-stage DAS


Total aromatic reduction %wof (% on feed) 63 34 97
Density reduction, kg/m3 25 30 59
Cetane increase 7 7.8 10.0
Investment, $ million N/a 115 310
Payback period, y N/a 2 3.5

Key Takeaways

  • Interest in EAS and DAS is increasing because they enable refiners to co-process LCO, a high-sulphur stream for which the outlets are gradually closing.
  • The economics of revamping an existing low-or medium-pressure HDS unit in this way can be extremely compelling.
  • These are highly customised solutions that require close collaboration between the catalyst and process licensor and the refiner.

More in Industry Focus

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