Argentina's LPG, NGL capacities leap with completion of MEGA project

April 1, 2002
Start-up of the Mega project in Argentina exactly 1 year ago has increased the country's LPG production by more than a third and natural gasoline production by nearly a quarter. These increases have gone into exports to Brasil.

Start-up of the Mega project in Argentina exactly 1 year ago has increased the country's LPG production by more than a third and natural gasoline production by nearly a quarter. These increases have gone into exports to Brasil.

The project has also more than doubled ethane production, entirely for internal consumption in the production of ethylene, polyethylene, and polyvinyl chloride.

The massive project consists of a separation plant in Loma La Lata in Neuquén Province, a 600-km (373-mile) liquids pipeline from Loma La Latato Bahía Blanca in Buenos Aires Province, and a fractionation plant in Bahía Blanca along with incremental storage and shipping facilities.

Investment in the project reached $490 million as well as another $225 million in pre-operating expenses, taxes, and financial costs.

This article reviews the corporate ownership structure of the operating company, Compañía MEGA SA, and the facilities that comprise the project.

Who we are

Compañía MEGA SA organized with the objective of building and operating the facilities. As registered with Argentina's Inspección General de Justicia on Oct. 31, 1997, the company consists of Repsol YPF subsidiary YPF SA, (38%), Petrobras SA subsidiary Brasoil Alliance Co. (34%), and Dow Chemical Co. subsidiary Dow Investment Argentina SA (28%).

All the partners have important strategic aims in MEGA:

  • Repsol YPF captures the highest value for NGLs not recovered before the project was running. It supplies all the natural gas to MEGA, which generates incremental sales of natural gas.
  • Petrobras ensures its own long-term LPG and gasoline supply, which allows the company to substitute present and future imports at a lower cost. In Brazil, LPG is mainly for domestic use.
  • Dow, through PBBPolisur (Dow 73%, Repsol YPF 27%), participates worldwide in local production of ethylene.

As part of Dow's expansion plan, it ensures that the raw material which helps PBBPolisur's expansion. It eliminates the high cost of imports deriving from the lack of ethylene.

The project

The natural gas separation plant at Loma La Lata, Province of Neuquén, is supplied with the natural gas from the Neuquén basin, under a long-term supply contract with Repsol YPF SA. NGLs (C2, C3, C4, C5+) are separated to be fractionated in Bahía Blanca and the residual gas (C1) is re-injected into trunk pipelines.

The Loma La Lata-Bahía Blanca pipeline exports the liquids separated from natural gas as a unique and homogeneous blend. The fractionation plant, in Bahía Blanca, Cangrejales area, Puerto Galván, processes for sale the product received by the pipeline.

Ethane is sold directly to PBBPolisur under a long-term contract executed for such purpose.

Both the LPG (C3 and C4) and natural gasoline are exported to Petrobras under a long-term contract. The necessary storage and shipping facilities were built.

Loma La Lata

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The Loma La Lata plant (Fig. 1) takes up to 36 million std. cu m/day (MMcmd) of natural gas from different wells with the object of recovering the liquid fraction (C2+). In the absence of ethane requirements, it may also operate to recover only LPG and natural gasoline (C5+).

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The gas that enters the separation plant (Fig. 2) moves to a feed separator to extract any sediment before it goes through dehydration. Under normal conditions, there is no separation carried out in this equipment, but during start-up procedures and under unstable conditions, this equipment fulfills an important function.

Liquids are discharged to the condensation system and exported to the existing Repsol YPF degasser plant. The gas product that leaves this separator is exported to the conditioning system.

The gas leaving the inlet separator with the gas used to regenerate molecular sieves moves into a separator acting as protective bottom of the molecular sieves. The dehydration system consists of five beds (the fifth under construction to be ready in May 2002), three for absorption and two in regeneration mode. Wet gas is separated and exported into the three parallel dehydration beds; once it moves out, gas is filtered before entering the cooling area.

Before moving into the filters, a fraction of dry gas is sent to the regeneration gas compressor where it is heated in furnaces under direct fire and finally used to absorb the bed water under regeneration mode. The exhausted gas is refrigerated with a fan and recycled until it enters the area. This sequence is automatically supervised by a logic sequence.

Dehydrated gas is divided and compressed into two equal cryogenic-separation trains designed to operate for both ethane recovery and ethane rejection in order to maximize ethane or propane recovery by using GLSP technology from Ortloff Engineers Ltd., Midland, Tex.

This kind of technology offers major advantages over conventional technologies because it has high tolerance to carbon dioxide; flexibility to operate with ethane recovery or ethane rejection with lower propane loss while operating in ethane rejection; and the most important one, higher liquids recovery with minimum horsepower cost.

The high tolerance to carbon dioxide is an important benefit because part of the feed-gas stream comes directly from the gas basin. The rest comes from low-thermal system plants.

Flexibility of operation mode permits the entire plant to operate at maximum profitability.

Because this kind of technology requires higher demethanizer pressures than conventional turboexpander processes, the compression horsepower is lower than other technologies.

The NGL recovery is expressed in terms of the recovery of ethane, propane, butanes, pentanes and heaviers. Recovery is "mole of component in the product stream" divided by "mole of component in the feed gas stream."

This area was designed to guarantee expected NGL recovery levels as follows:

  • Ethane-recovery mode: ethane, 86%; propane, 96%; butanes, 98.5%; and pentanes and heavier, 99%.
  • Ethane-rejection mode: propane, 92%; butanes, 98%; and pentanes and heavier, 99%.

The cryogenic area is fed by two streams, one entering an exchanger in which it is refrigerated together with residual gas, while the other is cooled by recovering its energy in the reboilers of the demethanizer column.

This last refrigerating circuit is only used when ethane is to be recovered because reinjected ethane (recovery of C3+) needs higher temperatures coming from a reboiler with hot oil.

The gas refrigerated through these two circuits is mixed in a static mixer to ensure a stable temperature and then enters the cold separator.

The vapor of this separator is partially pumped into a turbo expander, while the other fraction together with the liquid from the separator is under-refrigerated in equipment in which heat and residual gas are exchanged at the demethanizer column header. The output of this sub-cooler supplies the reflux to the demethanizer column.

Under the reinjected ethane mode, the liquid from the separator directly enters the demethanizer column.

Partially condensed and under-refrigerated gas exported from the turbo expander and the under-refrigerated liquid is fed into the upper section of the demethanizer column.

If the feed has a high content of carbon dioxide, part of the vapor coming from the separator, condensed and under-refrigerated, is separated into two streams.

One of them flows into the column together with the under-refrigerated liquid, while the other flows some trays below this one. This division reduces the content of acid gas in the liquid phase during demethanization, in order to prevent generation of solid carbon dioxide.

The vapor discharged by the demethanizer column at -90° C. is used to under-cool the upper feed header of the demethanizer and the cooling of feed gas to the sector; then it is compressed in a booster compressor engaged to the turbo expander.

Special pumps move the NGL from the demethanizer into a system of accumulation of the demethanized product.

For reinjected ethane, it is previously required that this liquid be refrigerated by fans to achieve temperatures within the range of 50° C. If the product is not included in the specifications, the NGL is exported to a storage tank where it is reprocessed.

Residual gas obtained from demethanization is recompressed to inject it into the pipeline. For this purpose, a compressor system discharges into the main existing gas pipelines. This compression system consists of three identical compressors activated by a gas turbine.

Pipeline

The aim of the pipeline is to transport NGL from Loma La Lata to Bahía Blanca through a buried line with two pumping stations and a terminal. An fiberoptic system is used for communicating and transferring data between the plants.

The initial pumping station is in Loma La Lata and supplies the required pressure to transport the product by means of three motor pumps, two in operation and one as spare, all operated by electric motors. One of the stations may be operated locally and by remote control. The remote operation is activated from the central control room at Loma La Lata.

The intermediate pumping station, approximately 270 km from Loma La Lata, provides the required conditions to transport NGL to Bahía Blanca. This station consists of three pumps in parallel, two in operation and one in spare, which are activated by gas turbines. Each station may be operated either locally or remotely from the central control room at Loma La Lata.

Treatment, fractionation

The terminal station receives NGL from the pipeline and pumps it to the storage system at Bahía Blanca. Like the initial and intermediate pumping stations, this one may be operated locally and by remote control from the central control room at Loma La Lata.

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The fractionation plant at Bahía Blanca (Fig. 3) receives NGL recovered at Loma La Lata through the 600-km pipeline. In this plant, ethane, propane, butane, and natural gasoline are fractionated.

Ethane is decarbonated and exported to PBBPolisur. Propane, butane, and natural gasoline are stored and shipped by tanker to Brazil.

The NGL flowing into this area must be pre-heated to ensure a constant feed temperature to the de-ethanizer. This pre-heating is carried out by exchanging heat with natural gasoline that, at the same time, is prerefrigerated before storage.

Conditioning of the fluid is accomplished by separating it into two streams: One is pre-heated, recovering heat from the column's bottom stream to be pumped to the middle section of the de-ethanizer column; the second flows along the bottom section.

The vapor of the de-ethanizer column header is partially condensed in an exchanger that uses propane as refrigerant; the ethane, its vapor product, is then preheated before being pumped to the area where ethane is treated and decarbonated.

The partial liquid of the condenser is pumped again to the de-ethanizer column as its reflux. The reboiler column uses vapor to heat. For ethane reinjection, this column will be bypassed and the NGL will be directly exported to the depropanizer.

The feed to the depropanizer column is divided into two streams: One is preheated with part of the bottom product of it then flows into the middle section; the stream with lower temperature flows into the highest section.

The propane product from the depropanizer is totally condensed by fans. Liquid propane is partially pumped into the propanization column as reflux, while the remaining liquid is the propane product.

The propane product is refrigerated until it reaches 50° C. in order to reduce the liquid boil-off in the atmospheric storage; then, it is under-refrigerated in the storage area by means of a refrigerated circuit with propane.

The bottom product of the column is divided into two streams in order to supply cold and hot feed of the debutanization column.

The feed to the depropanizer is divided into two streams before is exported to the debutanization column. The highest feed flows directly into it; the lowest is pre-cooled with the depropanizer feed.

The vapor discharged by the debutanizer is totally condensed in a fan and partially exported to the column as reflux. The rest of the product is pumped to atmospheric storage.

The butane product is refrigerated to 50° C. as propane product and then under-refrigerated using the refrigerated propane of the cooling circuit to be pumped to the refrigerated storage.

The bottom product of this column is natural gasoline, which is very light and is exported by pipeline to floating-roof tanks for which under-refrigeration is necessary.

Oherwise, it will be difficult to ensure the required pressure of vapor even though any butane fractions it may contain are completely eliminated.

This is why this product is used as heater for the de-ethanizer feed and is at the same time refrigerated in an exchanger with air. Finally, storage temperature and, thus, vapor pressure are achieved by exchange with refrigerating propane.

The ethane treatment section is used to remove carbon dioxide. Ethane obtained after de-ethanization is preheated to 30° C. by an exchange with propane, which at the same time will improve the refrigerating system.

The removal of carbon dioxide is based on a technology that uses amines which prevent ethane contamination with catalysts or additives that may affect their later use in the petrochemical complex.

Ethane is fed by the absorption column bottom where it contacts a weak solvent solution. The solvent absorbs carbon dioxide, allowing the ethane product to contain less than 80 ppm of carbon dioxide volume.

Ethane may be preheated before it is exported by the pipeline to prevent condensation in the stream.

The solvent solution with the absorbed carbon dioxide (rich solvent) is afterwards regenerated and conditioned.

Product refrigeration, storage

The product refrigeration system provides the necessary cold to store propane, butane, and gasoline, along with de-ethanized condensation.

Three thermal levels of refrigerant are achieved through a closed cooling system with propane: one of a high temperature 15° C., another of middle level -12° C., and the last one of low level -35° C. The condensation of propane refrigerant is accomplished by a fan and then is under-refrigerated by preheating ethane to be treated, reducing in this way the re-compression work required.

The process propane product is refrigerated from 50° C. to -30° C., the temperature required for its atmospheric storage. This refrigeration is carried out progressively, first at the highest level 20° C. is achieved; then at the middle level with an output of -5° C.; and finally the lowest level.

Butane is cooled from -5° C. to the required -6° C. using the middle level. Gasoline is refrigerated at a temperature of 20° C. by evaporating propane at a higher level. Partial condensation of vapor of the de-ethanizer header is achieved using a middle level of refrigerant.

This system uses another one with three power- driven compression stages.

The storage area consists of propane, butane, LPG, and gasoline tanks and the facilities in which LPG mixture is prepared. All the products are stored at atmospheric pressure. Products must be under-refrigerated with the refrigerating circuit to minimize vapors discharged from tanks.

Propane at -43° C., butane at -8° C., and their mixture are stored in three identical thermal-refrigerated tanks modeled to store propane in such a way that it is impossible to exchange it. These tanks have simple walls and an ordinary boil-off refrigerating system.

The preparation of the LPG mixtures uses the help of two special pumps, one for propane, another for butane and only one spare pump, for both services. These pumps prepare the mixture and pump it to a special tank through a static mixer.

Natural gasoline, on the other hand, is stored in floating-roof tanks designed for a maximum vapor pressure of 0.9 kg/sq cm at 42° C.

Propane, butane, and LPG are shipped through a loading system of refrigerated products basically consisting of loading pumps, refrigerating pumps, loading arms (one of which is used as spare), and an arm for exchange vapors of the tanker.

The system has been designed to load 40,000 cu m/day taking into account any delay that may occur due to tanker anchorage and casting off. Gasoline is loaded in tankers through a special system with a loading capacity of 15,000 cu m in 15 hr.

Investments; contracting

Expenditures for building the facilities were $490 million: $222 million at Loma La Lata, $89 million for the pipeline, $143 million at the fractionation plant at Bahía Blanca, and $36 million for storage and dispatch facilities, to which it may be added approximately $225 million of pre-operative expenses, taxes and financial costs.

Total amounts of disbursements allocated by year was 1998, 16%; 1999, 59%; and 2000, 25%.

Within the structure of MEGA agreements, there are important contractual relations that involve the company's business, like the building contract and the long-term contracts for the supply of natural gas, sale of ethane to PBBPolisur, and sale of LPG and natural gasoline to Petrobras.

MEGA executed an engineering, procurement, and construction (EPC) contract with a consortium of Japan Gasoline Corp., Argentina's Comercial del Plata Construcciones SA, and Italy's Saipem SpA.

This type of contractual relation pays a lump sum-turnkey contract with a fixed termination date.

Construction was finished and start up commenced by yearend 2000.

This date synchronized with the expansion of the petrochemical complex at Bahía Blanca, since its startup took place at approximately the same date.

Repsol YPF is responsible for the supply of natural gas to feed MEGA, which shall comply with the minimum annual, monthly, and daily volumes agreed on.

Natural gas base price is the market value for the basin, which shall be adjusted 50% according to gas oil and fuel oil price variation and 50% according to the price variations of ethane, LPG, and gasoline. This formula protects MEGA because it relates the price of raw materials to the sale price of products.

The Neuquén basin is the most important natural gas reservoir of the country, and Repsol YPF holds 61% of it, as of December 1998.

Likewise, the basin is the most important one for natural gas production of the country, and Repsol YPF produces 55% of the total volume of flow of the basin, as of December 1999.

Sale of ethane to PBBPolisur is under "take-or-pay," with MEGA selling 500,000-540,000 tpy of ethane to PBBPolisur. The ethane's contractual price is based on the international quotation price of pure ethane "FOB Mont Belvieu."

The contract for sale of LPG binds MEGA to sell 600,000 tpy of LPG to Petrobras, under a take-or-pay method. LPG contractual price is based on the international quotation price of the mix of propane and butane "FOB Mont Belvieu."

The contract for sale of natural gasoline binds MEGA to sell 210,000 tpy to Petrobras, under a take- or- pay method, based on the price quoted in Rotterdam (the Netherlands).

The author

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Carlos Martínez ([email protected]) is currently general manager in Compañía Mega SA based in Buenos Aires. Previously, he was natural gas division manager in Repsol YPF, having joined YPF in 1978. Martínez holds a degree in electro-mechanical engineering from the University of Buenos Aires and specialized in capital project evaluation.