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Processing shale oil in an FCC unit: 
catalyst and profit optimisation

Adjustments in base catalyst, use of ZSM-5 additives and metal traps enable efficient processing of paraffinic and heavy crude in the presence of metals contaminants.

Bart de Graaf, Charles Radcliffe, Martin Evans and Paul Diddams
Johnson Matthey
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Article Summary
Crude oil has been exploited since Babylonian times, but the modern petroleum industry began in the 1850s when the first commercial oil wells were drilled and the crude was distilled to produce lamp and lubricating oils. The convenience and greater energy density of refined petroleum products led to oil replacing coal as the primary energy source within 100 years. Demand growth was exponential from 1930 until the temporary decline in the 1973 oil crisis, driven by increased applications and economic growth. This in turn has spurred technical innovations in both production and refining. Interestingly, it is estimated that throughout all of oil’s commercial exploitation, with substantial consumption increases year over year, only 30-50 years of proven reserves were available (see Figure 1).1

The latest innovation to significantly increase supply has been horizontal drilling combined with hydraulic fracturing to yield oil and gas from shale formations. Initially, the primary impact was in the US. From the summer of 2010, the price of West Texas Intermediate (WTI) at the Cushing, Oklahoma, pipeline hub dropped relative to Brent (see Figure 2)2 due to increased availability of shale oils, combined with both the US crude export ban and pipeline constraints. This provided a major boost to US refining margins. Similarly, the petrochemical and other energy intensive industries also benefited from the big drop in natural gas and ethane prices coming from new production from shale plays. Because of additional shale oil production coming on stream, the US now ranks among the largest crude producers, significantly backing out imported crudes (see Figure 3). This displaced volume has combined with slowing demand growth and unwillingness of Saudi Arabia to lose market share, resulting in a supply surplus and the recent dramatic fall in global crude prices. This has realigned world prices with the US and eliminated the cost benefit for WTI versus Brent (see Figure 2).

Investments in shale oil exploration are declining rapidly. A Wood Mackenzie survey over oil fields representing total liquids output of 75 million bpd showed that only 190 000 bpd of oil production is cash negative at $50/bbl, 400 000 bpd at $45/bbl, and 1.5 million 
bpd at $40/bbl.3-5 Production from existing wells will continue since their development costs are sunk, but small producers and their financers are exposed to any prolonged low price. Both drilling and well life cycles are much shorter for shale oil than for conventional oil, with production decline rates much steeper than for conventional oil. It is not unusual for a well to show a decline of 65% in its first year, and an additional 35% in the second year. Thus, the current low price is postponing new investments and temporarily putting a brake on the shale oil revolution.

Processing shale oils
For decades, the trend in refining was clear: crudes were becoming heavier and sourer as wells matured. However, since 2011 the advent of significant shale oil production has reversed this trend in the US. Compared to previously processed (and anticipated) crudes, these shale oil crudes are very light and sweet, hence refineries need to adapt their operation and may also need modifications to process these crudes efficiently.

Shale oils typically contain much less vacuum gas oil (VGO) and little vacuum residue, and substantial amounts of naphtha, with gravities of 55 °API or greater (see Figure 4).6 These high gravity, high naphtha feeds bottleneck crude distillation units designed for heavier crudes. To regain lost capacity and thermal and separation efficiency, pre-flash towers, tower internal upgrades and re-optimisation of the unit heat integration networks is required. Shale oils are also highly paraffinic, reducing reformer gasoline and hydrogen yields. Many contain waxes, which can form deposits that foul storage tanks and process units. Blending shale crudes with heavier asphaltenic crudes can result in asphaltenes becoming insoluble and precipitating out, increasing fouling in process equipment such as heat exchangers.7 Shale oil sulphur content is usually low, but they do also show a wide variation in composition from basin to basin, and sometimes even from within the same formation. H2S can be a problem more frequently than with conventional crudes, and can result in contamination with tramp amines from added H2S scavengers. These are liable to deposit as corrosive salts in the atmospheric column overhead system. Additionally, the distribution and content of metal contaminants in shale oil differ to conventionally produced crudes; iron, calcium and sometimes potassium can be abundantly present as well as the more usual nickel and vanadium. Potassium and other alkaline metals should be removed in the desalter, but other metals concentrate in the FCC feed and present a problem for FCC product selectivities and unit operation: reformulation of the FCC unit catalyst system (base catalyst and additives) becomes important.

FCC heat balance effects
Because shale oil sourced FCC feeds are highly paraffinic, they are readily crackable, with low additive coke production, resulting in lower delta coke. The consequently lower regenerator temperatures lead to increased catalyst circulation, further enhancing FCC conversion, and resulting in an increase in LPG and naphtha yields. This is positive for volume gain, but can be an issue where distillates are high value. To compensate for the lower delta coke, catalyst activity needs to be high, particularly where the unit is preheat and circulation constrained. This is typically achieved by:
• Increasing Y-zeolite content and maximising rare earth on zeolite (a standard option when processing hydrotreated feeds with similar crackability)
• Increasing catalyst addition rate to achieve the required activity.

Operating the FCC unit in distillate mode at a low riser outlet temperature (ROT) reduces the catalytic coke contribution to delta coke. Ultimately, this may force the use of torch oil to maintain the unit in heat balance, which will be discussed in further detail. Adjusting both zeolite and matrix activity as well as the addition rate can allow flexibility to move the product slate more towards mid-distillate (LCO).

Gasoline octane and LPG olefinicity
The combined effect of abundant hydrogen donors from the paraffinic (and naphthenic) nature of their VGOs together with high rare earth base catalyst characteristics demonstrates shale oils’ high hydrogen transfer rates in FCC units. The high conversion gives high gasoline and LPG yields, but octanes and LPG olefinicity are low. The corollary is that propane, butane and isobutane yields are relatively high. The changes have a significant effect on alkylation and etherification unit feed availability, and therefore the gasoline pool octane.

ZSM-5 additives are well known and frequently used to improve LPG olefinicity and gasoline octane. The shape-selective ZSM-5 zeolite isomerises and selectively cracks lower octane gasoline range molecules to light olefins (propylene and butylenes). The gasoline pool octane increases via isomerisation and concentration of higher octane components. However, the already high LPG yield further increases when using ZSM-5 additives with highly crackable light feeds, which may require upgrading of the wet gas compressor (WGC) and gas concentration unit (GCU). Specialty ZSM-5 additives, which improve octanes at minimum increase in LPG, can help alleviate this problem and may be especially beneficial for shale oil applications. The refiner is able to optimise the FCC feed rate within the WGC and GCU limits while maximising octane barrels through the isomerisation and lower gasoline conversion these additives provide.
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