BP refiner says cleaner plants and fuels mean better business

Allen Kozinski, BP�s group vice president for global refining, told a Gas Processors Association meeting here Monday that cleaner fuels and plants mean better business. He said BP owns or operates 18 refineries worldwide and has sold or have for sale five refineries, but that doesn�t reflect BP�s view of refining in the future.


By the OGJ Online Staff


SAN ANTONIO, Mar. 12
�Allen Kozinski, BP�s group vice president for global refining, told a Gas Processors Association meeting here Monday that cleaner fuels and plants mean better business.

Kozinski said BP owns or operates 18 refineries worldwide. �We have sold or have for sale five refineries, which does not reflect our view of refining in the future.

�Refining is in general a commodity business whose basic technology has not changed in at least 40 years. Except for advanced controls, an 80-year annuitant could walk into a refinery and feel at home. Cost management, evolutionary improvements, and debottlenecking by smart engineers have expanded supply and improved the product slate while the total number of refineries has shrunk.

�New investments required by environmental regulations are resisted by the industry until the last moment and then the opportunity is used to expand capacity, which keeps the industry in surplus.

�In this environment, BP is selecting to keep only those refineries that have unique value for making clean fuels or chemical feed stocks. It is based on our belief that sustainable energy solutions must meet the customers� desire for cleaner fuels and to make them in cleaner facilities. By focusing on fewer refineries we can make the investments in cleaner fuels and in cleaner refineries and insure that these refineries are the most competitive in the world.�

Kozinski said fuel quality standards in the US and Europe are becoming more restrictive, especially in regard to the lower sulfur content of fuels.

�This will require another round of investment in desulfurization for both diesel and gasoline. We are planning that the entire product slate, except asphalt and coke, will eventually be slow sulfur, 10 ppm or less.�

He said BP has committed to a 10% reduction of its green house gas emissions by 2010, from a 1990 baseline, which would be a 40% reduction in real terms when growth is factored in.

�One way or another, I think it�s clear that the future for this business will be about cleaner products produced in refineries with nearly zero emissions. We (at BP) are taking action now, not waiting for the regulations.�

Kozinski said more desulfurization at refineries means more hydrogen production. Greenhouse gas reductions will require more cogeneration facilities. Both will use more natural gas.

�In the longer term, the green agenda is likely to force us all to rethink and develop our approach to making transportation fuels and petrochemical feed stocks and to force an entirely different outlook where both producers and processors are compatible with the environment.

�Our view at BP is that we should not fight the green agenda but encourage it and help shape it. We believe the role of business today is to take the initiative, not for public relations purposes, but for a good simple business reason. If we can give the world the choice it wants, then the world is likely to give us the business we want.�

More in LPG Markets