Refinery demand for processing catalysts will continue to flatten over the remainder of 2009 and into 2010 as the global recession winds out and energy prices remain soft. Operators, however, will continue to seek the greater efficiencies in energy use and productivity that processing catalysts permit.
Requirements for cleaner fuels and pressures from stiffer environmental regulations will continue to support catalyst use, even as product prices and demand sag over the remaining months of recession.
High-severity operations are benefiting from improvements in reforming catalysts, while process units are able to run longer before going into turnaround.
As refiners carry out the global move toward higher diesel production while reducing sulfur content, higher severity hydrotreating catalysts are helping to control costs and improve operational efficiencies, while petroleum-product markets begin to recover in 2010 and after.
Revised outlook
Late last year, in its most recent published global overview of the worldwide catalyst market, Freedonia Group Inc., Cleveland, predicted overall catalyst demand among chemical, petroleum refining, and polymer companies would rise at 6%/year to $16.3 billion in 2012. Volume demand would grow at 2%/year to 5.3 million tonnes.
For refining catalyst trade, Freedonia forecast a growth of 5.9%/year through 2017. Demand would reach more than $5.6 billion in 2012 and more than $7.6 billion in 2017.
Catalyst demand in petroleum refining, said the report, would be "quite strong due to healthy volume growth in hydroprocessing catalysts and higher refined product output" in Africa, the Mideast, and Asia-Pacific. Global efforts to reduce air pollution by lowering sulfur content in motor vehicle fuels will "boost catalyst loadings," as will the ongoing shift toward heavier grades of crude oil, and development of unconventional petroleum resources such as Canada's tar sands.
That was then, however—October 2008; this is now.
In response to questions from Oil & Gas Journal, Freedonia Group's Ned Zimmerman offered a qualifying assessment, based on events since midthird-quarter 2008.
With the advent and deepening of the global economic downturn in late 2008, he said, contraction in manufacturing in many parts of the world significantly lowered chemical, polymer, and refined-product volumes, which then directly affected worldwide catalyst demand. The drop in catalyst volumes depressed average prices as well, although a drop in commodity and platinum-group metal prices from their 2008 highs "helped ease the pain."
Freedonia Group, said Zimmerman, have lowered expectations for future world economic growth that informed the late 2008 report. Those expectations have contributed to prospects for slower growth in world oil consumption and world refined-products production.
In general, Freedonia Group now expects somewhat slower average annual global growth in refinery catalyst demand through 2012 in most regions, with the biggest difference occurring in North America due to the size of its market and reduced expectations of US oil consumption.
The situation in the US reflects not only slower forecast average annual economic growth but also shifting fuel efficiencies of the motor vehicle fleet, changing motorists' driving habits, and the potentially greater impact of biofuels on the US motor fuel needs.
Reduced North American refined-product consumption will also affect such other regions as the Middle East and Asia-Pacific, said Zimmerman. In both regions, countries have been building surplus refining capacity, at least some of which has been targeted toward North America.
On the whole, refining catalyst volumes by 2012 will likely increase from their 2007 base, although growth will be quite slow. This pace in turn would reduce value growth of the market as well. Growth in value terms is harder to project, he allowed, as averaging pricing tends to be much more volatile.
From the perspective of refining catalysts types, fluid catalytic cracking and alkylation catalysts will be the most severely affected by the slowdown in North America. Demand growth for hydroprocessing, reforming, and other catalysts will also be slower than previously expected but not nearly to the same degree.
OGJ subscribers can download free of charge the 2009 OGJ international refining catalyst compilation at Oil & Gas Journal's web site (www.ogjonline.com) by scrolling down to "Additional information," clicking on OGJ subscriber surveys, catalyst compilation, then logging in with a user name and password.
Stricter environmental standards, particularly for reduced sulfur content in distillate fuels, will help support hydroprocessing catalyst demand, he said. This will occur in many regions of the world, not just in North America, which is why hydroprocessing catalysts will fare much better than most other refining catalysts.
Also supporting hydroprocessing catalyst demand will be efforts to extend low-sulfur fuel requirements to off-road vehicles and to ships operating in the coastal waters of many countries.
Activity
The following recounts some major activity among refining-catalyst suppliers and refinery operators since the last OGJ review of catalyst suppliers (OGJ, Oct. 1, 2007, p. 52).
Operations
In September 2008, Abu Dhabi Oil Refining Co. (Takreer) selected UOP LLC, a Honeywell company, to supply technology and engineering services for expansion at its Ruwais refinery. The refinery will produce propylene, unleaded gasoline, naphtha, LPG, aviation turbine fuel, kerosine, gas-oil, bunker fuel, and other hydrocarbon derivatives (OGJ Online, Oct. 10, 2008).
The refinery, to start up in 2014, will use UOP technologies for production of low-sulfur distillate and gasoline, said UOP. Its Unicracking process with its Distillate Unionfining process will upgrade heavy feedstocks to produce ultralow-sulfur diesel.
UOP's Merox process will remove sulfur from saturated LPG streams, and its BenSat process will manage benzene content in the gasoline pool.
The refinery will also include a hydrotreating unit that will use the UOP Naphtha Hydrotreating process and Distillate Unionfining unit to produce low-sulfur kerosine. The unit is the largest kerosine-fed hydrotreating unit ever licensed by UOP, said the announcement.
In addition, through a 2006 alliance with Albemarle Corp., Baton Rouge, UOP is providing catalysts for the new Takreer units.
In June 2008, UOP joined with Rentech Inc., Los Angeles, to offer technology for production of cleaner fuels, specialty waxes, and chemicals.
The nonexclusive agreement between UOP and Rentech will provide refiners, petrochemicals, and synthetic-fuel producers the ability to convert synthesis gas to ultraclean fuels, specialty waxes, and chemicals. The plan aligns Rentech's process to convert synthesis gas from biomass and fossil resources and hydrocarbons with UOP's hydrocracking and hydrotreating processes that process and upgrade hydrocarbons to fuels and chemicals, said the company.
In February 2008, Hunt Refining Co. selected UOP to supply technology, basic engineering services, and equipment as part of Hunt's plan to double its gasoline and diesel output for the Southeastern US.
Hunt had installed two new units at its Tuscaloosa, Ala., plant that use UOP's CCR Platforming process and its Unicracking process. The units increase crude throughput by more than 30% to 69,000 b/d and double production of gasoline and diesel, according to a UOP announcement.
Hunt also converted an existing UOP Fixed-Bed Platforming process unit to a UOP Par-Isom process unit to enable a gasoline product to meet expected benzene regulations. The US Environmental Protection Agency had mandated that refineries adhere to 0.62%/year benzene content in gasoline by 2011.
Construction on the new units began in 2008. They are scheduled to come on line this year with the revamp scheduled for completion in 2010.
UOP said its CCR Platforming is a continuous catalytic reforming process used to produce high-octane gasoline from naphthenes and paraffins. Unicracking technology upgrades light cycle oil feedstocks to produce ultralow-sulfur diesel and naphtha. The Par-Isom technology processes light naphtha to produce high-octane gasoline blending components with low benzene content.
In December 2007, Newfoundland & Labrador Refining Corp. selected UOP to supply technology, basic engineering services, and equipment for a new fuel refinery to be built in the Placentia Bay area of Newfoundland and Labrador (OGJ, Apr. 7, 2008, p. 24).
Start-up of the complex is scheduled for 2011. The plant will process 300,000 b/d Middle Eastern crudes for the production of transportation fuels for North America and Europe. The NLRC facility is the first new refinery constructed in North America since 1984.
It will employ UOP technologies to produce low-sulfur, high-quality clean fuels, said the announcement. Technologies include UOP's Unicracking and Unionfining processes to remove sulfur and upgrade distillate materials for production of clean fuel. UOP's CCR Platforming and its Penex process will produce high-octane, clean-burning gasoline.
Additionally, NLRC will use UOP's Chlorsorb system, which absorbs chlorides off regenerated catalyst from the CCR Platforming process to enhance efficiency of chloride management and reduce emissions.
New ventures
In October 2008, Albemarle signed a technology cooperation agreement with UOP and Petroleo Brasileiro SA to accelerate commercialization of UOP's catalytic crude-upgrading process technology.
Under terms of the agreement, the three companies now collaborate to demonstrate the technology as a cost-effective option to upgrade heavy crude oils and bitumen-derived crude.
The process, said the Albemarle announcement, reduces viscosity of crude, allowing it to travel easily through pipeline transport with the use of external diluting agents. The CCU process provides an additional alternative to address problems inherent with heavy crude and logistics associated with increasingly remote drilling sites.
Petrobras has demonstrated the CCU technology in its pilot plants, said a Petrobras manager.
In July 2008, Albemarle announced it would offer its Nebula catalyst in hydrocracking and hydrotreating applications as part of the Hydroprocessing Alliance, a cooperation with UOP mentioned earlier.
The alliance offers catalyst for reloads and revamps of hydrocracking and hydrotreating units for fuels applications. UOP and Albemarle formed the Hydroprocessing Alliance in 2006 to support production of clean transportation fuels worldwide.
Nebula, said the Albemarle announcement, is a material jointly discovered with ExxonMobil Research and Engineering Co. and codeveloped with Albemarle. It is a base-metal catalyst with higher activity than conventional hydrotreating catalysts, said the company.
In addition, Nebula enables production of ultralow-sulfur diesel with no additional capital investment and can enhance hydrotreating unit revamps to reach higher throughputs or achieve higher product quality standards. It has been used in more than 40 applications since its introduction in 2001, said the company announcement.
Also in July 2008, Neste Oil Oyj, Finland, awarded Albemarle an order to produce catalysts exclusively for Neste for use in its NExBTL renewable diesel process. Albemarle's contract included scheduled deliveries of the catalysts for 2008, 2009, and 2010.
Neste Oil and Albemarle had worked together for several years to develop catalysts for the NExBTL renewable-diesel process, said the announcement. Neste Oil operates one NExBTL plant in Porvoo, Finland, a second diesel plant there started up in July 2009. Neste Oil is also currently building world-scale NExBTL plants in Singapore and Rotterdam.
In March 2008, W.R. Grace & Co. announced plans to increase manufacturing capacity at its Lake Charles, La., plant.
The expansion was to enable increased production of specialty aluminas, a raw material in Grace's fluid cracking and hydroprocessing catalysts, which refineries use to produce fuels. Start-up is expected this year.
The Lake Charles plant, a Grace Davison manufacturing unit, produces silica and alumina-based catalysts. It is the largest producer of fluid cracking catalysts in the world, according to the company.
Technologies
In May of this year, Albemarle launched the first fluid catalytic cracking product from the company's newest manufacturing technology process known as "Onyx." The catalyst is specifically designed for application to gas-oil feeds to increase naphtha yields by as much as 3% while reducing coke.
The technology involves a manufacturing process that results in "enhanced pore structure and optimized active site distribution," says the company. The catalyst technology uses a matrix composition.
In March, BASF Catalysts launched a technology that, it said, enables refiners to use their current gasoline-oriented FCCUs to meet the increased global demand for diesel fuel.
BASF's HDXtra catalyst "helps increase diesel yields by maximizing production" of the light-cycle oil produced from the FCC unit. The LCO can be blended or further upgraded to augment the refiner's production of high-quality diesel fuel. This technology, combined with optimized operating conditions, according to the company, enables refiners to increase LCO yield by up to a 10% volume increase, with nearly half of the benefit attributable to catalyst selectivity.
HDXtra combines high matrix activity with good coke selectivity, said the company. The catalyst also uses moderate zeolite activity, which "better controls the amount of LCOs cracking into gasoline while also offering low H-transfer activity, which preserves more hydrogen in LCOs for minimal cetane penalty."
In July 2008, Albemarle announced development and production of a new catalyst that can help improve the performance of hydrodesulfurization units by up to 35% over the then most active catalysts in the hydroprocessing marketplace.
The new product, Ketjenfine 770 hydrodesulfurization catalyst, would enable ultralow-sulfur diesel refiners to improve operating margins by increasing catalyst cycle length, increasing throughput, or running cheaper, lower quality feedstocks, all without additional, new capital expenditure, according to the company's announcement.
In November 2007, UOP announced it had expanded its slate of technologies to help refiners produce clean gasoline from heavier crude oil. UOP's slurry hydrocracking process is designed to upgrade bitumen and heavy crudes to lighter distillates. It is based on a technology originally developed by Natural Resources Canada and was further developed and proven commercially viable, said UOP, at the Petro-Canada plant in Montreal over 15 years starting in 1985.
