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Feb-2018

The future for hydrocracking: part 2

Technical solutions and strategies for innovative hydrocracking technologies are needed to meet challenging environmental legislation and future market challenges.

PATRICK CHRISTENSEN, AMY HEARN and THOMAS YEUNG
Hydrocarbon Publishing Company
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Article Summary
Part one of this series of articles appeared in the Q4 2017 issue of PTQ and focused on the current market conditions and long-term challenges facing hydrocracking technology. Short-term demand for fuels produced by hydrocrackers remains positive. Thanks to weak oil prices that translate into lower retail rates, and a healthy global economy, gasoline and diesel (or gasoil) have enjoyed a boost in demand. Increased air travel, particularly in emerging economies like China and India, has bolstered jet fuel/kerosene consumption. Furthermore, diesel sales are expected to surge to meet the 0.5% sulphur bunker fuel specification at least in the medium term as the International Marine Organization (IMO) has banned the use of high-sulphur bunker fuel, beginning 1 January 2020. Unfortunately, in the longer term hydrocracking products will see a decline in demand because of forecast peaking of gasoline use in the US and China, a ban on internal combustion engine vehicles in Europe, an expanding number of cities forbidding the use of diesel fuel, and rising competition from electric vehicles (EVs).

Refineries with hydrocracker units must come up with options to sustain unit operations in the future. The key is to change the product slate – made up of LPG (about 5-10%), light naphthas (10-15%), heavy naphthas (25-35%), and middle distillates (55-65%) – in order to keep fuels in demand.

In part two of the series, we discuss the importance of operational flexibility, the latest technologies, and further R&D works that enable refiners to capture opportunities as the market shifts.

Flexibility to capture opportunities
In a refinery, hydrocracking is utilised to upgrade a variety of feeds that range from coker naphtha to various heavy gasoils and residual fractions into lighter molecules. The hydrocracking process has emerged as the production ‘workhorse’ of middle distillates – diesel, jet fuel, and heating oil – in many refinery configurations.

Nowadays, the viability of hydrocrackers as the key processing units in future is being challenged because of pollution and climate change concerns as well as the increasing popularity of electric and other alternative fuels-powered vehicles worldwide.

Operational flexibility, on the other hand, should give hydrocracker operators a competitive advantage to overcome obstacles and turn them into opportunities. There are several areas of opportunity, such as benefiting from price-advantaged crudes, increasing consumption of jet fuel, producing more heavy naphtha for BTX-centric catalytic reformers, making superior grades of lubes, and maximising utilisation via process integration. The following sections present examples of hydrocracker development and technology offerings in these areas.

Processing a variety of feedstocks
OPEC’s 1.8 million b/d production cut for six months effective from 1 January 2017, extended to March 2018, has narrowed the discounts for heavy high sulphur crudes partly because of the construction of sophisticated refinery capacity around the globe, and partly because OPEC’s supply cut has disproportionately impacted heavy and middleweight grades. Meanwhile, the market is swimming in light sweet crudes, to the point where some grades, such as Agbami and Akbo from Nigeria, are struggling to find a buyer at all. As a result, less sophisticated European refineries designed to process mostly light oil – considered to be undesirable and projected to face potential closure – are benefiting from cheaper crude sources. On the other hand, complex refineries in the US and many new heavy oil-
oriented plants in Asia and the Middle East, which count on wide heavy oil discounts, are at a disadvantage, at least for the time being.

Both conventional hydrocracking technologies and those designed for treating residual streams will be impacted by the increased processing of opportunity crudes or price-advantaged crudes. These crudes could be heavy oil, medium sour or light sweet grades, depending on supply and demand in the market. Therefore it is imperative for refineries with hydrocracking units to be flexible to take advantage of lower priced oil as it becomes available in a volatile market.

A major problem for refiners looking to process tight oil in the hydrocracker is the relative lack of gasoil material provided by this feed, potentially leading to existing hydrocracking capacity being under-utilised. In order to prevent this under-utilisation, refiners may look to add additional streams (for instance, cracked stocks) to the hydrocracker feed to ensure that capacity utilisation is maintained. Additionally, the lighter nature of these tight crudes leads to more light ends coming from the hydrocracker at the same conversion level while also negatively impacting the cold flow properties of middle distillate products and lowering the octane value of naphtha produced from the unit.

For resid hydrocracking, a general increase in capacity is expected as larger quantities of residual streams are processed. The impact on more conventional hydrocracking units, however, is somewhat more complicated as the quality of intermediate streams can vary greatly based on the crude source from which it is derived and the processing that has been applied. In general, the quality of heavy gasoil streams coming from resid fractions of opportunity crudes is expected to contain high levels of sulphur and aromatic hydrocarbons. Nitrogen also is present and, depending on the particular stream, metals and asphaltenes can be other components that need removal.

The heavy refinery streams are typically derived in some way from either atmospheric residue (AR) or vacuum residue (VR) from the refinery distillation column; so, in the case of resids from opportunity crudes, one can expect all of these streams to contain high levels of sulphur and aromatic hydrocarbons. There are commercial process designs and catalysts specifically developed to handle these 
components.    

Focus shifting to jet fuel
As was mentioned previously, increasing air travel has boosted demand for jet fuel. Refineries are gearing up to make more jet fuel kerosene. For instance, PetroChina has said that it will build a new hydrocracking unit at its Golmud refinery in Qinghai province, 
China with the capacity to make 150000 t/y (3200 b/d) of kerosene. The new unit was expected to start up in October 2017.

Sinopec’s Fushun Research Institute of Petroleum and Petrochemicals (FRIPP) has developed a new generation of flexible hydrocracking catalyst. This features a smooth and open pore structure that significantly improves utilisation of the active centre, enhancing selective hydrocracking reaction capacity for flexible production of high quality chemical raw materials (high aromatic content heavy naphtha) and clean fuel products (CN-V standard clean diesel or its blending component and high quality jet fuel No. 3).

HC-320 from UOP is said to possess superior activity and stability when compared to previous generation hydrocracking catalysts. In addition to diesel, HC-320 can yield ethylene cracker feed, jet A-1/kerosene, and high quality lube base stocks. HC-520 is the newest distillate selective hydrocracking catalyst offered by UOP in the Unity line. HC-520 utilises a new support technology and alternative metals compared to other Unity hydrocracking catalysts to boost the output of distillate.
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