Business Trends Opportunity: A Clean fuels — shifting to a low -sulfur world — The Future of Energy
A latest New technologies are helping move refiners to a low-sulfur world, while revised fuel standards are catalysts for more clean fuels projects to develop higher-quality transport fuel. We @ Mumbai Multimedia Studio keeps updating our audience thru the Articles & Blogs on Future of Energy, crude by products, black gold and on refineries etc — please follow the trends with us on the subject from time to time and phase after phases on current projects, policies, obligations, up gradation and many more to be online the know-how of future energy production, cost allocation and their salvage, deliverance, liberate and recover to meet the demand and supply process.
Over the last decade, the oil industry has taken incredible steps to scale back sulfur levels in transportation fuels. Refiners have invested billions of dollars in new units, upgrades/retrofits and expansions to satisfy new sulfur and emissions regulations. These investments promote the reduction of CO, pollutant, hydrocarbons and stuff in both diesel and gasoline vehicles. New technologies are moving the oil business toward a low-sulfur world. New regulations and fuel standards are acting as catalysts for added clean fuels projects to develop higher-quality transportation fuels.
Essar Oil’s 20-MMtpy refinery is found in Vadinar, Gujarat, India. The power concluded a planned maintenance turnaround in 4Q 2015 that included the completion of the D-Max Project. A part of Essar’s OptimaPlus program, the project included the conversion of the vacuum gas-oil hydrotreater unit into a light hydro-cracking unit, similarly because the addition of latest installations within the diesel hydro-treating unit.
Around the world, legislation mandating decreased emissions and lower levels of airborne pollutants is coming into effect. In response, refiners are implementing operational and processing changes to cut back sulfur levels in transportation fuels. New technologies are moving the downstream hydrocarbon processing industry toward cleaner, lower-sulfur transportation fuels.
A low-sulfur world doesn’t come cheap, though. Refiners are investing billions of dollars in new units, upgrades/retrofits and expansions to satisfy new sulfur and emissions regulations. These investments will help produce high-quality fuels that meet Euro 4, Euro 5 and Euro 6 specifications. Many refiners round the globe have adopted European standards for fuel quality, as Europe has been the front runner on regulations for low-sulfur, “clean” transportation fuels. European passenger vehicle emission standards for Euro 4, Euro 5 and Euro 6 are detailed in Table 1 and Table 2. These standards promote the reduction of (CO), pollutant (NOx), hydrocarbons (HCs) and particulate (PM) in both diesel and gasoline passenger vehicles. As shown in Fig. 1, many nations round the world already produce transportation fuels that meet Euro-4 specifications. Other regions, like center East, are investing heavily to extend the assembly of Euro 4 and Euro 5 standard fuels.
The following is an outline of major clean fuels projects and trends being implemented round the world. Each region is investing within the implementation of recent technologies to satisfy cleaner fuel requirements. These new processing units will help produce higher-quality transportation fuels.
US/Canada
The US transportation fuel market is that the world’s largest. The country’s government will begin to enforce the new Tier 3 program starting in 2017. This program will set new vehicle emissions standards and lower the sulfur content in gasoline. in keeping with the US Environmental Protection Agency (EPA), sulfur content in gasoline are going to be limited to 10 parts per million (ppm). this can be a discount from Tier 2 standards, which limited the sulfur content in gasoline to 30 ppm. The program maintains the present refinery gate per-gallon content of 80 ppm and also the 95-ppm downstream distribution cap. The EPA forecasts that the new rule will significantly reduce vehicle pollutants into the atmosphere. for instance, the EPA forecasts that NOx emissions are reduced by about 260,000 tons in 2018 alone. Large US refineries (those producing greater than 75 Mbpd) must suits Tier 3 standards by 2017. Refiners producing below 75 Mbpd must meet Tier 3 regulation standards by 2020. To befits new regulations, US refiners have invested in additional units, like hydro-treaters, to cut back the sulfur content in transportation fuels.
In Canada, petroleum fuels constitute 95% of Canada’s transportation energy needs. The country has aligned itself closely with US fuel standards and is making strides to repeatedly reduce sulfur levels in transportation fuels. This includes the introduction of stringent Tier 3 fuel regulations for passenger vehicles and light-duty trucks. These fuel standards will begin in 2017, which coincides with the startup folks Tier 3 regulations. Canadian refiners have already invested over $8 B over the past decade to cut back sulfur levels in gasoline and diesel fuels. Since 2005, sulfur levels in gasoline and diesel have decreased by over 90% and 97%, respectively. New Tier 3 standards would be instrumental in continuing to scale back sulfur in transportation fuels, yet as reducing vehicle emissions to just about zero over the lifetime of the vehicle.
China
To help curb pollution, the country has set aggressive fuel economy standards through 2020. China is implementing its National V fuel quality standard, which equates to Euro 5 standard transportation fuels. Euro 5 caps sulfur content in gasoline and diesel at 10 ppm. Recent regulations required refiners to supply Euro 4 standard transportation fuels nationwide by the top of 2015. Euro 5 standard transportation fuels are going to be required for the automotive industry by 2017. These new regulations are being implemented one year earlier than schedule. The implementation of National V fuel quality standards for non-automotive diesel has been pushed back one year to January 2018. This includes “general” diesel employed in agriculture and industry. General diesel will must meet Euro 5 standard requirements within now frame. Upgrading the nation’s fuel quality could cost Chinese refiners over $7 B.
India The country has 22 major refineries operating, with a complete throughput capacity of 4.3 MMbpd. To satisfy increasing demand for transportation fuels, India is investing upward of $30 B in additional refining projects through 2020. Capital expenditures are expected to be even higher thanks to new regulations to curb pollution and produce Euro 4 and Euro 5 standard fuels by 2020. In January, Road Transport Minister Nitin Gadkari announced that Indian refiners will have to invest $4.5 B to supply Bharat Stage 6 (BS-6) standard fuels by 2Q 2020. BS-6 fuels are reminiscent of Euro 6 fuel specifications. These new regulations are being imposed four years previous schedule and need a 68% reduction in NOx emissions. Cars sold within the country are subject to BS-4 standards. India’s new regulations will bypass the BS-5 stage and move on to BS-6. The proposed clean fuels bill was in response to a World Health Organization study that found that 13 of the world’s dirtiest cities were in India. The installation of secondary units to fits new fuel standards could cost Indian refiners over $17 B.
Indonesia Southeast Asia’s biggest economy is that the world leader within the production of vegetable oil, and is promoting its use as a biofuel. The country boosted the mandated amount of blending in diesel in 2014 from 7.5% to 10%, and subsequently to fifteen in 2015. Indonesia raised the blending requirement to twenty this year and plans to extend it to 30% in 2020. consistent with the Indonesian Biofuel Producers Association, Indonesia’s biodiesel consumption will increase from 1.1 kiloliters in 2015 to 7.9 kiloliters in 2016. the extra usage of biofuels is predicted to decrease vehicle emissions substantially.
Africa Few countries have adopted low-sulfur fuel regulations, but multiple countries in southern Africa have announced a commitment to supply cleaner fuels by the top of the last decade. The African Refiners Association has developed AFRI specifications as a tenet for the assembly of cleaner fuels. The region aims to supply fuels with AFRI-4 specifications by 2020. this might constitute maximum sulfur content in diesel and gasoline of fifty ppm and 150 ppm, respectively. to satisfy these goals, African refiners would want to speculate over $7 B in additional units. The most notable clean fuels initiative has been put forth by African nation. The country’s Clean Fuels Program 2 (CF2) is a shot to develop Euro 5 specification fuels. this might entail developing fuels to contain 10 ppm or less of sulfur, a lowering of benzene from 5% to fifteen, and therefore the reduction of aromatics from 50% to 35%. The CF2 program was initially designed to start in 2017, but it’s been pushed back to 2020 or beyond. The extended deadline provides South African refiners with time to form the required upgrades to provide cleaner fuels and could be a more realistic timetable for the program’s implementation — one that would cost South African refiners billions in upgrade costs. The country’s refiners are hesitant to form the required upgrades thanks to the low return on investment. The country is additionally in talks with Iran to make a brand new clean fuels refinery within the country. The plan could replace the $10-B Project Mthombo, within the industrial port of Coega, which has been in limbo for a few time. The new refinery, fed with Iranian crude, would produce Euro 5 specified fuels, meeting the government’s mandate. Other African countries, like Egypt and Algeria, are planning projects to boost local fuel quality. With ultra-modern refineries being inbuilt Asia and therefore the geographic region, Africa may continue importing refined products to satisfy demand, in lieu of investing heavily in capital-intensive projects.
Middle East The region continues to extend refining capacity to diversify exports and supply higher-quality refined products to the world market. Traditionally, Mideast refineries have had simple configurations and high heating oil yields, partly thanks to strong power generation requirements. This condition is changing. a replacement generation of highly complex plants, combined with upgrades and expansions at existing plants, is radically altering the merchandise mix. New unit configurations include hydro-cracking, catalytic cracking and hydro-treating capacities designed to reduce fuel output and maximize low-sulfur middle distillate, diesel and gasoline production.
Saudi Arabia and Kuwait are leading the charge in new clean fuels projects within the region. To go with mandatory sulfur specifications for gasoline and diesel, Asian nation is spending billions of dollars to construct multiple clean fuels projects. The country is seeking to scale back sulfur content in diesel and gasoline to 10 ppm and to lower benzene content in gasoline to fifteen. This represents a dramatic shift in sulfur levels from 2012, when Saudi Arabia’s maximum sulfur level for diesel was greater than 500 ppm. The country plans to commission its 400-Mbpd Jazan refinery by 2018. The refinery will produce higher-grade transportation fuels, including ultra-low-sulfur diesel. together with its JVs, Saudi Aramco will upgrade all of its domestic refineries to supply lower-sulfur transportation fuels. Several projects — the Ras Tanura Refinery Clean Fuels and Aromatics project (which was on hold, but was reinstated in mid-2015), the Riyadh Refinery Clean Transportation Fuel project, the Saudi Aramco Mobil Refinery Co. Clean Fuels project (completed in 2014) and also the PetroRabigh Clean Fuels project — are designed to accomplish the Kingdom’s goal of manufacturing near-zero-sulfur fuels.
Kuwait is investing over $30 B on ambitious plans to overhaul its refining sector and become the region’s clean fuels leader. The plan focuses on modernizing and integrating the country’s Mina Abdullah and Mina Al-Ahmadi refineries, moreover as on building the region’s largest refinery, the Al-Zour plant. Once completed, the reconfigured and integrated Mina Abdullah and Mina Al-Ahmadi refineries will decrease the sulfur in gasoline production from 500 ppm to but 10 ppm. Benzene and aromatics concentrations will decrease. Bunker heating oil sulfur content will decrease from 4.5 ppm to 1 ppm, and maximum sulfur content of full-range naphtha will drop from 700 ppm to 500 ppm. Benzene and aromatics concentrations will decrease. Bunker heating oil sulfur content will decrease from 4.5 ppm to 1 ppm, and maximum sulfur content of full-range naphtha will drop from 700 ppm to 500 ppm. With the development of Al-Zour and also the upgrading and integration of its domestic refineries, Kuwait is about to become the most important producer of fresh fuels within the Middle East by 2021. Other countries within the region also are making sizable investments to provide higher-quality transportation fuels. Efforts include the Ruwais refinery expansion (completed in 2015), the Jebel Ali and Fujairah projects within the UAE, the Sohar refinery upgrade and Duqm refinery projects in Oman, the Sitra refinery modernization project in Bahrain, and also the SOCAR Turkey Aegean Refinery project in Turkey.
Latin America Due to the expansion within the region’s social class, geographic region has seen tremendous petroleum product demand growth over the past decade. Demand has been shifting to more middle and light-weight distillates, as critical oil. Multiple refinery upgrades, expansions and greenfield facilities are delayed or canceled thanks to the drop by oil prices. resident countries, which rely heavily on oil export revenues, are hit hard by the call in oil prices. In turn, this has left little money to fund capacity expansions and upgrades to provide higher-grade transportation fuels. New clean fuels initiatives are going down within the region, however. In late 2015, Brazil increased its ethanol blending mandate in gasoline from 5% to 7% and in diesel from 25% to 27%. These new blend requirements, together with the startup of recent refining capacity, are forecast to assist mitigate a considerable portion of refined fuel imports. Additional refinery plans are announced, but massive debt, corruption and price overruns have put projects on the rear burner.
In late 2015, Mexico’s state-owned company, Pemex, announced plans to reinstate its domestic refinery upgrade program. The $23-B investment will upgrade Pemex’s refining system to extend production of cleaner-burning diesel and gasoline. The plan’s goal is to quite double the assembly of ultra-low-sulfur gasoline and increase the assembly of ultra-low-sulfur diesel. Colombia is additionally investing heavily within the production of higher-grade transportation fuels. State-owned Eco-petrol plans to finish the total ramp-up of its Cartagena refinery in 2Q 2016. The $7-B expansion project quite doubled capacity to 165 Mbpd, including the modernization of the prevailing refinery to require advantage of the new complex and improve efficiencies. The project will help reduce regional refining constraints; produce ultra-low-sulfur gasoline and diesel from heavy, high-sulfur crudes; adhere to the newest emissions protocols and requirements; increase the refinery’s conversion capacity from 76% to 95%; and meet international standards for transportation fuels.
Russia The country produces over enough refined products to satisfy domestic demand, but it lacks advanced facilities to provide higher-grade transportation fuels, like Euro 4 and Euro 5 fuels. In response, Russia launched a $55-B program in 2011 to modernize its existing plants and encourage exports of high-quality products. The plan needed the installation of 130 new units by 2021. The program saw delays in 2015 thanks to falling oil prices and Western sanctions, which have limited the flexibility for Russian companies to secure financing. The peak of Russia’s modernization program is forecast for 2016–2018. The country’s two largest refiners, Rosneft and Lukoil, have led the charge on refinery upgrades to provide Euro 4 and Euro 5 fuels. Smaller Russian refiners also are upgrading their refineries to scale back sulfur content in transportation fuels. Russia’s modernization program will still concentrate on increasing its light products yields, with a key specialize in meeting demand for gasoline and jet fuel, increasing fuel standards to Euro 5 specifications, and replacing old units to decrease residual product yields and maximize utilization.
Bunker fuels A major change for world organisation (EU) refineries is that the required sulfur content reductions for marine fuels. Marine fuels constitute about 7% of EU refining output, in line with Concawe {established in 1963 by a small group of leading oil companies to carry out research on environmental issues relevant to the oil industry. Its membership has broadened to include most oil companies operating in Europe.. } New regulations kicked into effect in 2018 that need shippers to modify from marine residual fuels to lower-sulfur marine fuels in designated emission control areas (ECAs). These areas include the Baltic and sea, coastal areas off of the US and Canada, and therefore the US sea.
In Conclusion : This Sulfur content in marine fuels consumed in ECAs was capped at 0.1%, the identical quality as lower-sulfur distillate materials. The International Convention for the Prevention of Pollution from Ships (MARPOL) directive also sets limits on marine fuels in non-ECAs. Beginning in 2020, the sulfur content of marine fuels utilized in non-ECAs are going to be reduced from 3.5% to 0.5%. Although the initial start date of this new regulation is January 1, 2020, the plan are reviewed in 2019 to test the provision of the specified heating oil. looking on the end result of the review, the startup date of recent non-ECA sulfur regulations may well be postponed until a minimum of 2025…
