Refinery modernization and efforts to meet high enviromental requirements of EU Directives - 11th OIL FORUM Session III - Trends and challenges: ...

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Refinery modernization and efforts to meet high enviromental requirements of EU Directives - 11th OIL FORUM Session III - Trends and challenges: ...
Refinery modernization and efforts to meet high
     enviromental requirements of EU Directives

                                                   11th OIL FORUM
     Session III – Trends and challenges: Petrochemical and Refining

                                                   09/10/2019
                                               VLADIMIR GAGIC
                                       BLOCK REFINING DIRECTOR         NIS.EU
Refinery modernization and efforts to meet high enviromental requirements of EU Directives - 11th OIL FORUM Session III - Trends and challenges: ...
Content
Pančevo oil refinery – RNP
   • Movie – Construction of DCU
   • History and developement
   • Efficiency indicators

EU regulatory framework in RNP
   • Investments in fuel quality , energy efficiency and environmental projects
   • Emission trends

GHG emissions
  • Future obligations
  • CO2 emissions scenario

Conclusion

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Refinery modernization and efforts to meet high enviromental requirements of EU Directives - 11th OIL FORUM Session III - Trends and challenges: ...
Movie RNP

Film – NIS – Future at work

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Refinery modernization and efforts to meet high enviromental requirements of EU Directives - 11th OIL FORUM Session III - Trends and challenges: ...
Pančevo oil refinery - RNP
                              Location: 20km from Belgrade and 3km from
                             river Danube
                              Area: 151 hectares
                              Crude oil processing capacity: 4,85 Mt/year
                              Nelson complexity index: 9,2
                              Share of light products: 75%
                              No. of employees: cca 1000
                              IPPC Facility
                              Higher tier SEVESO operator

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Refinery modernization and efforts to meet high enviromental requirements of EU Directives - 11th OIL FORUM Session III - Trends and challenges: ...
History and development of RNP
                           1965.      1968.                            1979.             1985. 1987.              2001.- 2003.          2009. 2011.- 2013.           2017.    2020.

                                                                                                                                                2011.
                                                                      1979.                                                                     Market
    1959. Refinery
                                                 •   Start of Atmospheric Distillation Unit S2100                                            liberalization
    established as a
    business entity                              •   Reconstructed Platforming S-300

                                                                                                                                                   2012.
                                                                                                                                            Start up of MHC-DHT
                                                                 Refining capacity                                 2001.                           Complex
                       1965.                                                                                      Rebuilt
              Start of construction                                   4.8 Mt/y                                    refinery
                of the first plant
                                                                                                                                                     2013.
                                                                                                                      2002.                    Reconstructed FCC
                                                                                        1985.                     Reconstructed
                                                                          Start of the process units:           Vacuum Distillation
                                                                          • Vacuum Distillation, S-2200
                                      1968.                                                                                                2009.
                                                                          • Bitumen, S-0250
                       The first plants put into operation:                                                                               Ownership
                                                                          • FCC Complex and Alkylation
                  •    Atmospheric Distillation Unit, S-100                                                                             transformation
                  •    Thermal Cracking, S-200
                  •    Naphtha Platforming, S-300                                                                          2003.
                  •    Diesel and Jet Fuel HDS, S-400                                                               Reconstructed FCC

                                                                                              1987.                                                                 2017.
                                                                                     S-200 reconstructed into                                                 Start of contruction
                                   Refining capacity
                                                                                         Visbreaking Unit                                                     of Delayed Cooking
                                        1.3 Mt/y                                                                                                                   unit - DCU

                                                                                                                                                                             2020.
                                                                                                                                                                          Start of DCU

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RNP efficiency indicators
• In order to monitor business performance and market position, NIS has opted for an independent methodology for
  monitoring refining efficiency indicators

• For this purpose, the methodology of Solomon Associates was chosen, which as a world leader in this field covers
  over 85% of refining capacity in over 70 countries worldwide

• RNP has been in the program since 2008, when a system of measuring key performance indicators, planning of target
  values and development of the Program for achieving the set goals were established

• Since 2008, RNP has recorded a positive trend in all key business parameters:
     Increase in operational availability
     Improving energy efficiency
     Improving staff efficiency
     Reduction in operating costs
     Reduction of hydrocarbon losses

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Investments implemented and ongoing in RNP
            1 Fuel quality              2      Energy                  3 Renewables           4     IED Directive      5   VOC Directives
                                               efficiency

        •     MHC / DHT – fuel      •       Optimization of        •     Bio components   •       Reduction of PM      •   Reconstruction of
              EURO 5 standard               combustion on                blending                 in air (FCC              gasoline tanks
        •     DCU – Zero fuel oil           furnaces                                              reconstruction )     •   Installation of VRU
              production            •       Thermal isolation                             •       Reduction of SO2         unit (Autofiling
                                            of tanks                                              in air (Washing of       station, Railway
                                    •       Installation of heat                                  ejector gas at           station end Port)
                                            exchanger on FCC                                      Vacuum dest.)        •   Instalation of loading
                                    •       Application of                                •       Reduction of NOx         arms for bootom
                                            ceramic coatings                                      in air (Low NOx          loading
                                            on furnaces                                           burners              •   Reconstruction of
                                    •       Replacement of                                        installation)            petrol tanks
                                            electric motors and
                                            other
        CAPEX 2012-2020:            CAPEX 2012-2016:               CAPEX 2016-2021:       CAPEX 2012-2019:             CAPEX 2012-2018:
        696 million €               17,3 million €                 6,8 €                  50,5 million €               101,5 million €

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1   Fuel quality - Modernization of RNP – MHC/DHT
Modernization of RNP was a major requirement for bringing the Company to a strategically important
leadership position in the regional petroleum products market

Phase I – MHC/DHT
Description:
• Start up of Mild hydrocracking in 2012
• Capacity 2.970.000 t/year
• Increase in oil refining depth up to 84%
• Output of white derivatives is increased up to 75%

Goal:
• Production of unleaded motor gasoline and euro diesel with a
  sulfur content not exceeding 10 ppm, according to the Euro 5 standard
• Increase in processing volume and export to the Balkan region

Environmental effects:
• Reduction of sulfur content in derivatives
• Reduction of SO2 emissions in air

Cost:
• 396 milion EUR

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1   Fuel quality- Modernization of RNP – DCU (Delayed coking unit)
Phase II – DCU
Description:
• 2017 beginning of the project
• Start-up of the plant - 2020

Goal:
• Increase in oil refining depth up to 99,2%
• Production of high-calorie fuel - petroleum coke
• Heavy residues will be used as feedstock for DCU
• Increasing the energy efficiency of RNP

Environmental effects:
• Reduction of SO2, NOx and PM emissions from all RNP combustion plants
• With the start of operation of DCU, production of fuel oil ceases, thereby
reducing the emission of pollutants into the air in the region (NIS markets)

Cost:
• > 300 million EUR

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2    Energy efficiency projects in RNP 2013-2019

                                                                    Realization Total
                             Project
                                                                       year    mil. EUR
1. The insulation of the tank in RNP                                  2013       1,9
2. Installation of energy efficient lighting in RNP                   2013       0,2
3. Measurement of electricity consumption                             2014       0.2
4. Installation of system for the optimization of combustion in
                                                                      2014       5,3
furnaces S-300, S-2100, S-2200, S-400 and S-2300)
5. Installation of energy efficient electric motors                   2014       1,2
6. Water-fuel oil emulsion system                                     2014       0,8
7. Installation of frequency regulation of the electric motors of
                                                                      2016       0.7
the air coolers S-400/2100/2200/3600
8. Reduction of NOx emission in flue gases in RNP – Energy plant      2016       1,5
9. Application of ceramic coatings in BA-2101 and BA-2201
                                                                      2016       0,8
furnaces
10. Installation of "Packinox" heat exchanger at Plaftofming
                                                                      2016       4.2
S-300
11. Implementation of continuous dry cleaning of the BA-2201A /
                                                                      2018       0,14
B furnace
12. Application of ceramic coatings in furnaces BA-301/2/3/4,
                                                                      2018       0,39
BA-305 and BA-306
13. Application of ceramic coatings in furnaces                       2019       0,5
                                                                        Total:   17,3

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3        4    IED and VOC Directives - Environmental projects in RNP 2012-2019
                                                                    Realization     Total
                                  Project
                                                                       year        mil. EUR
        Environmental projects
         IED Directives
         1. FCC- reduction of solid particle emissions in air          2012          15,6
         2. Regeneration of spent sulfuric acid                        2012          14,5
         3. Construction of a closed drainage and closed sampling
                                                                       2015          6,2
         system
         4. Replacement of Low NOx burners on furnaces on:
                                                                    2018/2019        2,8
         Vacuum dest., HDS, Atm.destilition and FCC
         5. Washing of ejector gas on Vacuum destilition               2019          1,6
         6. Other projects                                               -           9,8
         VOC Directives
         7. Reconstruction and modernization of installations for
                                                                       2012          3,0
         loading and unloading of LPG
         8. Reconstruction and modernization of the port               2013          29,9
         9. Reconstruction of auto loading stations                    2015           8,8
         Biocomponents blending with diesel fuel                       2016           6,8
                                                                          Total:    99,0
        Projects with environmental effect
             Reconstruction of petrol tanks                                          59,8
                                                                          Total:    158,8
•       Projects are realized in order to comply with the obligations of IED Directive 2010/75/EU and VOC Petroleum Directive
        11
Air emissions trends (2009-2019)

 000 t                                                              Emissions of pollutants into air
            8.90
9.00
                          8.30
8.00

7.00

6.00                                       5,40
5.00                                                                                                                                     4.70
                                                             4.10
4.00                                                                                                              3.50            3.60          3.40
3.00        2.60          2.60
                                           2.00              1.90              1,80
2.00                                                                                            1,50
                                                                                                                  1.00            0.90   0.90   0.90
1.00        0.50          0.70                                                 0.70             0.50                                                   0,60
                                           0.20              0.30              0,10                               0.10                   0.10   0,30
                                                                                                0,03                              0.05                 0,04
0.00                                                                                                                                                       0.20
    2009                 2010              2011              2012             2013              2014              2015            2016   2017   2018   2019 *

                                                                                      SO2       NOx         PM

       • From 2009 – 2015 significant investments in environmental projects
       • From 2015 - 2018 we were burning fuel oil as dominant fuel, which reflected on the emissions
       • From 2019 dominant usage of natural gas

       12          * Projected emissions for 6M 2019. (based on the I series of measurements and operating hours of facilities)
Compliance with environmental legal requirements
                                                     NOx                                                                                                                                                       SOx
          800                                                                                                                                          1400
                                                                               700                                                                                                                                                 1200
          700                                                                                                                                          1200

          600                                                                                                                                                                                              976
                                                                                                                                                       1000

          500                                                                                                                                                                                                            739

                                                                                                                                              mg/Nm3
                                                                                                                                                       800
 mg/Nm3

                                                                                                                                                                843
          400                                                                                         375                                                                                                                                   600       600         600
                   350                           345                                                                                                   600
                                                                                             300                   300
          300                                                                                                                                                                                                                                      594
                                                              252                                                                                                  350
                             200       200                                                                                                             400                          317           317
          200                                                                                                                                                                                                         367
                                                           196                                      216                                                200                                              300
                           181       163
          100                                                                                                   160
                                              127                                                                                                                               3             3                                  15        26                 3
                 55                                                           56          44                                                             0
           0                                                                                                                                                    BA-0252       BA-301/4      BA-401      BA-2101       BA-2201   BF-2301+ BA-4301/2 BF-9601   BF-9602
                BA-0252   BA-301/4   BA-401   BA-2101      BA-2201      BF-2301+ BA-4301/2 BF-9601              BF-9602                                                                                                         DC-2302
                                                                        DC-2302
                                                                                                                                                                                                              2019     ELV
                                                    2019     ELV

                                                                                                               Particular matter, PM
                                                                              140
                                                                              120                                                                                                                                 For full compliance with Industrial
                                                                                                                                   117
                                                                              100                                                                                                                                 emissions Directive (IED), projects in
                                                                     mg/Nm3

                                                                               80                                                                                                                                 progress:
                                                                               60
                                                                                                                                         40
                                                                               40
                                                                                             18           18           18
                                                                                                                                                                                                                  •      BA-0252 – Fuel gas desulfurization
                                                                                                                                                                              15
                                                                               20
                                                                                         8          10            15                                      1 5            14                1 5                    •      BF-2301+DC-2302 – Installation of
                                                                                   0                                                                                                                                     EC filter
                                                                                       BA-2101 P   BA-2101 R     BA-2101 S         BF-2301+            BA-4301/2      BF-9601             BF-9602
                                                                                                                                   DC-2302

                                                                                                                            2019     ELV

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Future obligation – GHG (EU – ETS)
                  Legal framework                     2    Preparation for new            3      Calculation of CO2
            1                                                                                                         4    Estimation of costs
                        in RS                                  obligation                           emissions

      •      Law on Climate changes still         •       RNP identified as C category                                Estimated cost of purchasing
             not adopted in RS (expected                  plant, CO2 emissions > 500                 CO2 emissions    emission units for 1 mil. t of CO2
                                                                                              Year
             end of 2019)                                 000t*                                           [t]         with:
      •      Then in 2 years adoption of by-      •       Identified new obligations                                  • 60% share of free units**,
                                                                                              2016      982.735
             laws, will introduce concrete                (monitoring plan, emission                                  • Current emission units price
             obligations (monitoring and                  report)                             2017      973.222         26 EUR/t CO2 is 10, 4 mil.
             reporting on CO2)                    •       Training of personnel for           2018     1.058.820        EUR/year
                                                          monitoring CO2
                                                  •       2 Studies done

                                                                                         cca 1 mil tons CO2/year       10,4 mil. EUR/year

 14       *In accordance with Regulation 601/2012 EC on monitoring of emissions reporting and GHG emissions
          **Source: Institute for Energy and Environmental Protection EKONERG from Croatia, 2018
Conclusion
• Good level of compliance with environmental legal requirements, still in progress to
  achieve full compliance;

• To achieve full compliance it is necessary to:
   • Substitute heavy fuel oil with natural gas;
   • Continue environmental investments Program implementation;
   • Continue Energy efficiency Program implementation;
   • Timely prepare for new obligation (EU-ETS)

• Plan for additional financial costs for EU-ETS:
   • Emission units purchase,
   • OPEX costs (laboratory analysis, measurement devices, reports, stock market, etc.)
• To keep active role in development of new legislation

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THANK YOU

            NIS.EU
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