WORLD CRUDE CAPACITY STAYS FLAT WHILE CONVERSION CAPABILITY RISES AGAIN

Dec. 20, 1993
Anne K. Rhodes Refining/Petrochemical Editor The world's crude oil refining capacity remained essentially flat during 1993, decreasing by only about 18,000 b/d. Conversion capability, however-measured as % on crude of four major processes (fluid catalytic cracking [FCC], hvdrocracking, catalytic reforming, and alkylation)-increased by about 3.4%. These are the findings of the Journal's exclusive worldwide refining survey (p. 46). Other important trends as of Jan. 1, 1994, include:
Anne K. Rhodes
Refining/Petrochemical Editor

The world's crude oil refining capacity remained essentially flat during 1993, decreasing by only about 18,000 b/d. Conversion capability, however-measured as % on crude of four major processes (fluid catalytic cracking [FCC], hvdrocracking, catalytic reforming, and alkylation)-increased by about 3.4%.

These are the findings of the Journal's exclusive worldwide refining survey (p. 46).

Other important trends as of Jan. 1, 1994, include:

  • Major increases in U.S. hvdroprocessing capacity as a result of low-sulfur diesel regulations.

  • Increased conversion capability by refiners in the Asia/Pacific region, Western Europe, Eastern Europe/C.I.S., the Middle East, and the U.S. Part of this increase is probably attributable to more accurate data from the former Communist Bloc.

Table 1 shows a ranking of the world's top refiners, in terms of crude distillation capacity. This is net capacity, including capacity in joint venture companies. New information has enabled the ranking of 20 companies this year, as opposed to 10 last year (OGJ, Dec. 21, 1992, p. 41).

The consolidation of Saudi Arabian Oil Co. (known as Saudi Aramco) and Saudi Arabian Marketing & Refining Co. pushed Aramco up to tenth in the listing. This change, and the rise of Texaco to ninth position, pushed Petroleo Brasileiro (Petrobras) down two notches, making it the eleventh largest refining company.

Sinopec, the Chinese national petroleum company, fell from fourth to seventh as a result of a miscalculation last year.

CAPACITY CHANGES

Table 2 gives a summary of worldwide refining operations by region.

Considering the aggregate world capacity figures, significant gains were made in catalytic cracking, up 389,000 b/d or 3.6%, and hvdrocracking, up 229,000 or 8.5%. These changes reflect the trend toward increased bottom-of-the-barrel processing.

A look at the major refining regions reveals other important trends.

NORTH AMERICA

There were no major changes in North American crude capacity, even though seven U.S. refineries, totaling a little more than 119,000 b/d, were shut down. The only significant change in North America was the addition of a great deal of hydrotreating capacity (Table 3a).

Hydrorefining capacity appears to have decreased, according to Table 2, but Table 3 shows that this is a byproduct of the conversion of good deal of hydrorefining capacity to hydrotreating capacity, again in preparation for this October's U.S. low-sulfur diesel mandate. It is unclear whether this capacity was physically converted or simply reported differently this year.

Combining hydrotreating and hydrorefining capacity to avoid the subjectivity of classification, and comparing this with the same combination in 1992, reveals the magnitude of the capacity change caused by low sulfur diesel. U.S. refiners increased this combined capacity by 750,300 b/d, or 8.2%. That's a major change for what was already the world's most sophisticated refining sector. Concurrently, refinery hydrogen capacity has increased almost 198 MMscfd.

Smaller changes were also recorded in catalytic reforming and thermal operations. A number of small expansions are responsible for the boost in reforming capacity. Delayed coker expansions at Unocal's San Francisco refinery, Shell's Norco, La., plant, and Star Enterprise's Port Arthur, Tex., refinery caused this increase, as did the addition of 19,000 b/d of visbreaking capacity at Phibro Refining Co.'s Texas City, Tex., refinery.

Fig. 1 shows that U.S. conversion capacity is still on the increase, although it appears to be leveling out. All four processes combined increased by 0.8% in 1993.

WESTERN EUROPE

Crude capacity in Western Europe is down about 161,000 b/d, primarily because of the shut down of two refineries in Italy: Agip's 80,000 b/d Rho, Milan, refinery and Kuwait Raffinazione e Chimica's 100,000 b/d Naples refinery.

Hvdrocracking capacity has increased because of additions at: Mobil Oil Francaise's Notre Dame de Gravenchon, France, refinery (7,700 b/d); Agip's Sannazzaro, Italy, refinery (30,000 b/d); and Turkish Petroleum Refineries' Aliaga (16,500 b/d) and Kirikkale (14,500) plants.

Coke capacity is down in Western Europe because Statoil shut down a 469 ton/day coker at its Mongstad, Norway, refinery.

Hydrorefining capacity is up because of two new middle distillate hydrorefining units at Turkish refineries-31,700 b/d at Aliaga and 77,400 b/d at Izmit--and a 32,450 b/d expansion at Kirikkale. Esso's Slagen, Norway, refinery also added significant hydrorefining capacity as did Wintershall's Lingen, Germany refinery.

Hydrotreating is also on the increase in Western Europe as fuel sulfur specifications continue to fall. Major additions were made in Belgium, France, Germany, the Netherlands, Norway, and the U.K. in 1993.

European Economic Community (EEC) refiners are continuing to increase conversion capacity, as is evident by Fig. 2. A number of small expansions are responsible for these changes.

Table 3b shows changes to capacities in the EEC.

ASIA/PACIFIC

Crude capacity increased most in the Asia/Pacific region this year (Table 3c). Several small expansions in India and Japan were primarily responsible for this change,

Asia/Pacific refiners also significantly increased hydrorefining capacity this year, when three major capacity additions came on stream in Japan:

  • 55,000 b/d at Fuji Oil CL's Sodegaura refinery

  • 70,000 b/d of heavy gas oil desulfurization capacity at Nippon Petroleum Refining CL's Negishi refinery

  • 25,000 b/d of heavy gas oil desulfurization capacity at Koa Oil CL's Marifu refinery.

Koa also added 220 tons/day of coke capacity at Marifu.

MIDDLE EAST

The only other region showing an increase in crude capacity is the Middle East. The restart of the Kuwait National Petroleum Corp. (KNPC) refinery at Shuaiba increased both crude and vacuum distillation capacity in the region in 1993 (Table 4).

Cracking capacity is up significantly in the Middle East because of the addition of 34,000 b/d capacity at KNPC's Mina Al-Ahmadi refinery and 82,000 b/d at Shuaiba.

Syria's Homs Refinery Co. shut down 530 tons/day of coke capacity, contributing to the changes in that category. KNPC also added 950 tons/d of coke capacity at Mina Abdulla and 117,000 b/d of hydrorefining capacity at Mina Al-Ahmadi.

Also increasing hydrorefining capacity was a 49,000 b/d increase at Petromin/Shell's Al-jubail, Saudi Arabia, refinery.

EASTERN EUROPE/C.I.S.

The capacity increase in the Eastern Europe/C.I.S. re,ion appears to be significant, although improved reporting, rather than capacity construction, is probably responsible for most of the changes.

FCC capacity increases have been reported, however, at refineries in Moscow (40,000 b/d); Saratov, Russia (14,860 b/d); Yaroslav, Russia (22,260 b/d) Pavlodar, Kazakhstan (40,000 b/d); and Kremenchug, Ukraine (28,000 b/d). A 54,000 b/d reforming addition was also reported at Kremenchug.

OTHER REGIONS

Changes in Africa and the South America/Caribbean region were minimal in 1993. Shell/BP's Durban, South Africa, refinery converted 77,000 b/d of crude capacity to vacuum distillation capacity, accounting for the slight decrease in that category.

Crude capacity in the South America/Caribbean region is down because Petrobras shut down 155,000 b/d of crude capacity and 71,000 b/d vacuum capacity at Cubatao, Sao Paulo. Other small reductions account for the remaining distillation capacity decrease.

Hess Oil Virgin Islands Corp. brought on stream a 75,000 b/d FCC unit this year at the world's second largest refinery. This accounts for the increase in catalytic cracking capacity in the region.

The world's largest refinery, a 571,000 b/d plant owned by Petroleos de Venezuela (Pdvsa) subsidiary Lagoven SA, reported no changes in 1993, although Pdvsa has major projects in store in the future.

COMPANY SIZE

U.S. refining companies with more than 200,000 b/d of distillation capacity are listed in Table 5. Independent refiner Tosco Corp. jumped onto the list for the first time this year after its acquisition of the former Exxon Bayway refinery in Linden, N.J., and BP's Ferndale, Wash., facility.

Coastal Refining & Marketing Co.'s ranking fell from 17th to 21st because of the shutdown of its three Kansas refineries. And Lyondell, as such, is no longer on the list, but rather is represented by Lyondell-Citgo Refining Co. This change results from Lyondell's joint venture with Pdvsa's U.S. company-Citgo Petroleum Corp.-for upgrade of its Houston refinery (OGJ, May 17, p. 23).

And Fina Oil & Chemical inched onto the list, taking the 22nd position with exactly 200,000 b/d of reported crude capacity.

In the EEC (Table 5), BP jumped ahead of Repsol because of a miscalculation in last year's table, and Petrofina moved up from 13th to 9th position. Kuwait Petroleum Corp. fell off the list because of its shutdown refinery in Italy. Isab was also inadvertently left off of last year's list.

Table 6 shows the percentage of U.S. capacity owned by the companies listed in Table 3. As is expected, stringent U.S. environmental requirements are pushing out the small refiner. Large refiners (200,000 b/d) are gaining capacity share in every category except alkylation, for which the shares have remained essentially even.

OXYGENATES

U.S. refiners were well equipped to meet oxygenate demand for the 1992-93 oxygenated gasoline season (OGJ, Oct. 25, p. 66). Oxygenate capacity, therefore, changed little over the past year, increasing from about 154,000 b/d to 179,000 b/d.

New units were added at BP, Marcus Hook, Pa. (2,600 b/d methyl tertiary butyl ether); Chevron, Richmond, Calif. (2,000 b/d MTBE); Citgo, Lake Charles, La. (2,970 b/d tertiary amyl methyl ether); Phibro, Texas City, Tex., and Krotz Springs, La. (1,620 b/d MTBE each); Shell, Norco, La. (7,000 b/d MTBE); Star Enterprise, Delaware City (2,191 b/d MTBE and 2,322 b/d TAME); Tosco, Martinez, Calif. (2,300 b/d MTBE); and Valero Refining Co., Corpus Christi, Tex. (2,700 b/d TAME).

Oxygenate capacity in the rest of the world (Table 7) remained about even over the year (some idle capacity, inadvertently left on last year's list, was removed this year).

CONSTRUCTION

The Asia/Pacific region remains the most active area in terms of refinery construction projects. China has firm plans for three grassroots plants totaling 270,000 b/d. All three are scheduled to be on stream by the end of 1994. Two additional refineries totaling 150,000 b/d, are under consideration.

Taiwan's Chinese Petroleum Corp. is constructing a 100,000 b/d refinery at Ta lin pu, to be completed in 1994, as well as major expansions at its two existing refineries.

Two of eight planned refineries in India reported receiving the "go-ahead" for construction: Essar Oil (180,000 b/d plant at Vadinar) and Reliance Group of Industries (120,000 b/d, site uncertain). And Pertamina is constructing a 125,000 b/d refinery in Balongan, Indonesia (Fig. 3), expected to start up within a year.

Japanese refiners also are undertaking a number of expansions and revamps. These projects include:

  • 7,000 b/d sulfuric acid alkylation capacity at Cosmo Oil CL's Sakai refinery

  • 45,000 b/d hydrorefining capacity at Cosmo's Shiba refinery

  • 50,000 b/d of added topping capacity for Idemitsu Kosan

  • 20,000 b/d of resid cracking capacity at Kyokuto Petroleum Ltd.'s Chiba refinery

  • 50,000 b/d of hydrotreating capacity at Nippon Petroleum Refining CL's Negishi refinery

  • 40,000 b/d of gas oil desulfurization capacity at Tonen Corp.'s Kawasaki refinery.

BHP Petroleum Pty. and Chinese Petroleum Corp. are planning a 150,000 b/d joint venture refinery at Bintulu, Malaysia, scheduled for mid-1996 start-up

In Korea, Honam Oil has almost completed a 27,000 b/d FCC unit at Yocheon, as well as a 20,000 b/d hydrotreater. And Philipinas Shell Petroleum Corp. is expanding its facility in Tabangao, Philippines, plus building a 110,000 b/d grassroots refinery.

In Singapore, one of the world's most concentrated refining spots, a major expansion is under way at Shell Eastern Petroleum Ltd.'s refinery at Pulau Bukom. Singapore Petroleum Co. is adding a 31,000 b/d resid cracker at its Pulau Merlimau facility.

In Thailand, Esso Standard Thailand Ltd. is expanding crude capacity at Sriracha by 82,000 b/d, which will more than double its present capacity by mid-1995. Two grassroots refineries are also scheduled to come on stream there in 1996: Rayong Refinery Co.'s 145,000 b/d plant and Star Petroleum's 130,000 b/d facility, both at Map Ta Phud, Rayong province.

MIDDLE EAST

A number of major projects are under way in the Middle East:

  • Bahrain Petroleum Co. is revamping much of its Sitra refinery, replacing four existing crude units with 180,000 b/d of new capacity.

  • National Iranian Oil Co. is continuing to bring on stream parts of its new Arak refinery, and is constructing a 240,000 b/d refinery at Bandar Abbas.

  • Paz Fuel Co. is planning a 100,000 b/d refinery at Ashdod, Israel.

  • Saudi Aramco is constructing capacity additions to almost every major unit at its Jeddah, Ras Tanura, Riyadh, and Yanbu refineries (OGJ, Oct. 18, p. 69).

SOUTH AMERICA/CARIBBEAN

South America and the Caribbean also hold a great deal of potential, in terms of capacity expansions:

  • Pdvsa subsidiary Maraven SA is expanding its Cardon refinery by adding four hydrotreaters, a hydrorefiner, MTBE and TAME units, a 60,000 b/d delayed coker, a 45,000 b/d catalytic reformer, and isomerization and hydrogen units.

  • Petrobras is in the midst of a major expansion at all of its refineries over the next 4 years. These plans include six hydrotreaters totaling more than 157,000 b/d, and three delayed cokers with almost 52,000 b/d of total charge capacity.

  • Ecopetrol is adding a 35,000 b/d FCC unit and a 40,000 b/d visbreaker at Barrancabermeja, Colombia, scheduled for 1995 start-up.

  • Trinidad & Tobago Oil Co. Ltd. is expanding its Point-a-Pierre refinery by adding a new visbreaker, hydrocracker, hydrotreater, and crude and hydrogen units.

C.I.S.

In the former Soviet Union, grassroots refineries are reportedly planned at:

  • Mangyshlak Peninsula, Kazakhstan-Mitsui & Co., Mitsubishi Corp., and Tokyo Engineering Corp., 120,000 b/d

  • Uzbekistan-Marubeni Corp. and China National Petroleum Corp., 100,000 b/d

  • Nizhnikamsk - 240,000 b/d

  • Novopolotsk, Belarus-66,000 b/d

  • Tyumen, W. Siberia-80,000 b/d.

Modernization projects are ongoing at a number of existing plants, including those at Baku, Azerbaijan; Chardzhou and Krasnovodsk, Turkmenistan; Drogobytch, Lisichansk, and Odessa, Ukraine; Khabarovsk, Nizhniy, Novo-Kuibystev, and Yaroslav, Russia; and Mozyr, Belarus.

OTHER PROJECTS

Several major projects also are under way outside the regions of major expansion. These include:

  • Koch Refining Co., Corpus Christi, Tex. (hydrocracker, hydrotreater, crude unit)

  • Lyondell-Citgo Refining Co., Houston (crude and vacuum units, coker, hydrotreater)

  • Shell Oil Co. (with Pemex), Deer Park, Tex. (coker, hydrotreater, alkylation unit)

  • Elf, Leuna, Germany (200,000 b/d refinery, 1995)

  • Isab, Priolo, Italy (visbreaker, deasphalting and ROSE units)

  • Pemex (major expansions at Cadereyta, Salina Cruz, and Tula, Mexico)

  • Petrogal, Sines, Portugal (FCC, visbreaking, vacuum, and alkylation units)

  • Genref, Durban, South Africa (two hydrotreaters, visbreaker, catalytic reformer).

Considering the length of this list of projects and the trend toward reduced plant emissions, the global refining picture is sure to change rapidly in the coming years.

Copyright 1993 Oil & Gas Journal. All Rights Reserved.