Aug-2021

Multi-phase project enables switch to heavier crude (TIA)

In recent years, deasphalted oil (DAO) hydrocracking has emerged as a highly attractive investment option, principally because it provides the opportunity to simultaneously address two key objectives.

Haeil Jo, Saudi Aramco (formerly of Hyundai Oilbank)
Changduk Cho, Hyundai Oilbank
Mike Street, Shell Catalysts & Technologies

Article Summary

First, it enables refiners to include greater proportions of lower-priced opportunity crudes in their diets, which has the potential to increase margin significantly. Secondly, it offers the opportunity to reduce fuel oil production.

In today’s new reality, refiners are likely to adopt a more conservative approach to capital investment, but a recent project by Hyundai Oilbank provides a compelling demonstration of how refiners can unlock business improvements by taking a phased approach. The South Korean refiner began to generate cash with a series of strategic investments, which it then used to fund additional projects.

Hyundai Oilbank’s project began in 2016, when it identified an opportunity to improve margins at its Daesan 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.

One of the site’s key constraints for processing a more difficult crude slate had been the maximum allowable metals content that the existing atmospheric residue desulphurisation (ARDS) unit could process. This unit consisted of two identical reactor trains (modules) that had fully independent high pressure sections and a common work-up section.

Phase 1: Deasphalting and moving to mild hydrocracking (MHC) service
In Phase 1, Hyundai Oilbank installed a new C5 solvent deasphalting (SDA) unit (a residuum oil supercritical extraction, or ROSE, unit licensed by KBR) and revamped the existing delayed coker to enable co-processing of vacuum residue and ROSE pitch feed.

Together with Shell Catalysts & Technologies, Hyundai converted one ARDS module to 100% DAO MHC service. The feed rate increased to 50% above the original design, at 50% conversion.

Also in this phase, Hyundai Oilbank and Shell Catalysts & Technologies revamped the second ARDS module. This was to enable it to process 50% more atmospheric residue above original design, at 20% conversion.

The products (0.5% sulphur, 4.5% micro-carbon residue) feed the existing residue fluidised catalytic cracker and will supply a future petrochemicals complex. These changes had a substantial impact on the site’s ability to process more difficult crudes, 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.

For the project to begin to generate returns, speed of implementation was also important. It took the project team just 30 months from the beginning of the feasibility study to start-up.

Phase 2: Adding additional capacity
The two organisations also worked together in Phase 2, which began in 2018. The original, common ARDS work-up section was augmented so that each reactor module had its own fractionation section. Debottlenecking the fractionation facilitated further revamps to both reactor modules.

Reactors were added to the DAO MHC module to enable a further 10% capacity increase and a 50% cycle-length extension. The ARDS module was revamped from a single train to two parallel trains. Adding more fixed-bed reactors helped to increase the capacity by an additional 30% and the cycle length by 50%.
These changes enabled the refinery to be further integrated with a new heavy-feed petrochemical complex that was being built, and the updated refinery flow scheme is shown in Figure 1.

For this phase, it took just 20 months from starting the feasibility study to starting up the revamped unit.

Conclusion
To enable the processing of super-heavy crudes while minimising capital investment, Hyundai Oilbank made a series of changes to the refinery configuration in a carefully designed combination of adding new hardware and revamping existing assets.

As a result, Hyundai Oilbank unlocked a major improvement in its refining margin. Also, in 2018 Hyundai reported it had the nation’s highest heavy oil upgrading ratio, and in 2019 it posted the industry’s highest ratio of net income to sales. The Phase 1 project, which ended in 2018, was a key contributor to these achievements.

This short case study originally appeared in PTQ's Technology In Action Feature - Q3 2021 Issue.

For more information: mike.street@shell.com