Industry News

Oil-to-chemicals process becomes reality

Saudi Aramco and SABIC are pursuing novel technology that will enable them to produce chemicals directly from crude oil, bypassing the refinery stage. The possibility of cracking light crude oil directly to produce olefins has already been proven in Singapore by ExxonMobil Chemical in its new flexible feed cracker

John Baker, ICIS

Today’s global petrochemicals industry grew up as a downstream adjunct to the oil industry and gasoline production. Technology was developed to use naphtha and LPG streams from the refinery as feedstocks for olefins and aromatics production in steam crackers.

But today, technology is being developed, and indeed is already in place, to use crude oil directly to produce chemicals, eliminating the need to reply on massive refinery investments.

In Singapore, ExxonMobil Chemical has revealed it is capable of using crude oil directly as a feed to its latest flexible feed steam cracker, which came onstream in 2014. And just this year, Saudi Aramco and SABIC revealed plans to develop and oil-to-chemicals project in Saudi Arabia, with start-up possible in 2020.

Both Saudi companies have been developing the necessary technology independently but look now to have decided to pool their efforts. SABIC made an initial announcement in 2014 that it was looking at building such a complex on its own.

It said in May that year that it was in the final stages of a study for the construction of the world’s first oil-to-chemicals complex, which would consumer 10m to/year of crude to produce “petrochemical products at the highest ever achieved conversion rate in a competitive and sustainable way.”

The now combined Aramco/SABIC project will be the first major new olefins capacity that SABIC has added in the GCC region since it started up its Yansab cracker in mid-2009 at Yanbu and its Saudi Kayan cracker in Al Jubail in mid-2010 – over half a decade ago.

Aramco earlier this year brought on ethylene capacity using liquid feedstocks at its Sadara Chemical joint venture with Dow Chemical, marking the first time naphtha cracking has been used in the Kingdom.

The use of crude oil as a feedstock to produce olefins and other petrochemicals is attractive economically where naphtha cracking is predominant, and also in the GCC region because availability of its traditionally used ethane feedstock is becoming harder to secure, leading to the search for alternative feedstocks.

A study carried out by consultancy IHS in late 2015 on the ExxonMobil Chemical and Aramco/SABIC technologies suggests a possible $200/ton cost advantage over naphtha cracking when producing ethylene. It calculates that in its 1m ton/year cracker in Singapore, ExxonMobil could net about $100-200/bbl margin above traditional naphtha cracking, assuming a $50/bbl crude oil price. The technology used is based on adding a flash pot between the convective and radiant sections in each cracker furnace, says IHS. The crude oil – a light sweet grade – is pre-heated and then flashed, taking off the lighter fractions as vapor which is fed into the furnace, while heavier components are collected at the bottom of the flash pot and can be transferred to the nearby refinery or sold into the market.

Stephen Prior, president of ExxonMobil Chemical when the cracker started up in early 2014, confirmed that “crude is the primary feedstock we are using in the expansion right now.”

He added that crude when cracked provides a whole range of new molecules that can be developed into new products, making it the “exact opposite of the ethane phenomenon, where you get a lot of ethylene but you don’t get a lot else.”

“When you crack crude, you have the whole barrel so you actually produce a richer mix of valuable by-products that you can further upgrade. We are already looking at what additional derivatives you might want to produce,” citing plans for using the C4 molecules for butyls and C5 molecules for adhesives.

Also, he added, “If you think about it, you have eliminated the refining step to produce the naphtha, so there is an inherent energy efficiency and emissions efficiency, [and a] sustainability story around that.”

The Aramco/SABIC technology works along a different route, says IHS in its report. It is understood that the process begins by feeding the crude oil into a hydrocracking unit which removes sulfur and shifts the crude’s boiling point curve significantly to lighter compounds.

The gas-oil and lighter compounds are then fed to a traditional steam cracker and the heavier products to a proprietary Aramco-developed deep fluid catalytic cracking unit that maximizes olefin output.

While the process would be some $200/ton cheaper than for naphtha cracking on a cash cost basis, the need for additional process units would make the process roughly equivalent to naphtha cracking when investment costs are taken into account with a required 15% pre-tax return on investment.

SABIC filed its own patents for an oil-to-chemicals process technology in the US in 2013. This essentially describes an integrated process configuration based on the strategic selection of conventional oil refining units, such as atmospheric distillation, vacuum distillation, fluid catalytic cracking, hydrocracking, coking and hydrotreating, to convert substantially all of a crude oil feed stream into fractions suitable for conversion to chemicals.

The process would, says SABIC, deliver over 50% conversion and preferably over 60% of crude oil to steam cracking-suitable feedstocks including, amongst others, aliphatic gases, naphtha and gas oil.

Another aspect of the technology is the integration of the above described configuration of refining units with a steam cracking facility to achieve synergetic benefits and the overall conversion of crude oil to olefins and aromatic compounds suitable for chemical production. More specific aspects include the selection of individual refining units in specified sequences to maximize the efficient conversion of crude oil to chemicals.

In their announcement in June this year of the signing of a heads of agreement for a feasibility study into a fully integrated oil-to-chemicals complex, Aramco and SABIC commented that if successful this would lead to a joint venture between the two companies to execute the project.

The companies added that, “the crude oil-to-chemicals process will involve innovative configurations with proven conversion technologies. This will create a fully integrated petrochemical complex which maximizes chemical yield, transforms and recycles by-products, drives efficiencies of scale and resource optimization and diversifies the petrochemical feedstock mix in the Kingdom.”

Saudi Aramco president and CEO, Amin H. Nasser added: “Our agreement with SABIC reflects our vision to build on Saudi Arabia’s global leadership in crude oil production and commodities export by substantially increasing the production of oil-based petrochemicals and further optimizing value across the entire hydrocarbons chain.

“This agreement will help spur a new era of industrial diversification, job creation and technology development in Saudi Arabia, particularly through downstream conversion of specialty chemicals by small and medium sized enterprises.”

SABIC vice chairman and CEO, Yousef Abdullah Al-Benyan noted that: “By working together to deliver Chemistry that Matters, SABIC and Saudi Aramco can drive advances that will diversify the Kingdom’s feedstock mix and make oil a viable petrochemical feedstock. We are hopeful that our agreement to conduct a joint feasibility study on the development of an integrated crude oil-to-chemicals complex in Saudi Arabia will ultimately lead to a new era for the Kingdom, driving strong economic growth, creating many new opportunities for aspiring young Saudis, and playing a significant role in the Kingdom’s economic transformation.”

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