In April, Hydrocarbon Processing launched the first iteration of its HP Sustainability webcast series. This series will focus on policy/regulations, capital expenditures and the latest technological advancements to ensure more sustainable operations at refineries, petrochemical plants and gas processing/LNG facilities.
The following is a summary of the first presentation, which focused on the global increase in policies and regulations to produce low-sulfur and ultra-low-sulfur (ULS) transportation fuels, and the subsequent boost in capital expenditures to adhere to new fuel regulations. The full webcast can be viewed at www.HydrocarbonProcessing.com/resources/webcasts.
What are clean fuels? A major aspect of "clean fuels" focuses on mitigating pollutants--carbon monoxide, nitrogen oxide, hydrocarbons and particulate matter--from vehicles' exhaust.
Many refiners around the globe have adopted European standards for fuel quality (Euro 4, Euro 5 and Euro 6), as Europe has been the frontrunner on regulations for low sulfur, "clean" transportation fuels. This includes reducing sulfur limits--measured in parts per million (ppm)--in transportation fuels. The refining industry has invested hundreds of billions of dollars over the past 30 yr to reduce the amount of sulfur in gasoline, diesel, jet fuel, etc. These investments have reduced sulfur levels in transportation fuels from 2,000 ppm (prior to Euro 2) in 1993 to less than 10 ppm (Euro 5 and Euro 6) at present.
Most countries use the European standards to measure sulfur in fuels, but use different names to describe them. These ULS fuels include Bharat Stage 6 (BS-6) in India, National 5 and Beijing 6 in China, Tier 3 in the US, AFRI 4 in Africa, and K4 and K5 in Kazakhstan, among others. Not only are these nations, and others around the world, regulating and investing in low-sulfur and ULS fuels production, but they are also mandating higher ethanol blending rates; an increase in biofuels production and usage; and an increase in the adoption of electric, hybrid-electric, compressed natural gas (CNG), hydrogen-fueled and/or alternative fuels-powered vehicles.
The push for lower-sulfur transportation fuels has moved into the global shipping sector, as well. In 2020, the International Maritime Organization's 2020 Global Sulfur Cap regulation will go into effect, which calls for marine vessels to burn low-sulfur marine fuels.
Capital expenditures for sulfur reduction. Over the past 30 yr, the global refining industry has invested hundreds of billions of dollars to reduce sulfur levels in transportation fuels, and many new units are expected to begin operations over the next several years.
According to OPEC's World Oil Outlook 2018, nearly 12 MMbpd of new secondary unit capacity will begin operations by 2024 (FIG. 1). These capacity additions include more than 6 MMbpd of new desulfurization capacity, more than 3 MMbpd of conversion capacity and more than 1.7 MMbpd of octane-boosting capacity. Most of this new capacity will be in the Asia-Pacific and Middle East regions.
Global initiatives. Every region has announced new policies and regulations to reduce sulfur levels in transportation fuels, along with emissions-mitigation initiatives and capital investments in new processing capacity. The following will detail major initiatives and investments being...