Cat-16-13 Fcc Benchmarking – Exploring Industry Trends And Creating Paths Forward

Cat Cracker Seminar August 23-24, 2016 Royal Sonesta Hotel Houston, TX

CAT-16-13

FCC Benchmarking – Exploring Industry Trends and Creating Paths Forward

Presented By: Alexis Shackleford Technical Marketing Specialist BASF Corporation Houston, TX

American Fuel & Petrochemical Manufacturers

1667 K Street, NW Suite 700 Washington, DC 20006

202.457.0480 voice 202.457.0486 fax

www.afpm.org

This paper has been reproduced for the author or authors as a courtesy by the American Fuel & Petrochemical Manufacturers. Publication of this paper does not signify that the contents necessarily reflect the opinions of the AFPM, its officers, directors, members, or staff. Requests for authorization to quote or use the contents should be addressed directly to the author(s)



Market Trends



Ecat and Operating Benchmarking Trends



FCC Catalyst Proposal Request



Paths Forward

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cagr

cagr

+21%

(Million Barrels per Day (Mio B/D))

112 105 93

Gasoline Naphtha Jet Fuel Kerosene

Middle Distillate Residual Fuel LPG other

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0.9%

26

24 7 1

6

9

8 7

1

27

1

7

34

37

8 10 9

8

7

13

14

10

10

2015

2025

2035

28

Source: Stratas Advisors Jan 2016 Report Note other: Lubricants, asphalt, refinery fuel gas, coke, and miscellaneous product.

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Continued slow growth with investments slowing conversion units over long term

Increase in Middle Distillate fuel demand Increased LPG Demand of 40%

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Transportation needs drive approx. two thirds of the oil demand. Cat-16-13

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Regional Refined Product Demand Growth (2015 – 2035) (million b/d; annual % growth)

 Flat/slight decline in demand in mature western economies  Strong growth in Asia Pacific with increasing populations and developing economies  Growth in Middle East driven by diversifying economies and population growth

 Other emerging regions also experiencing growth  Evolving import/export patterns to accommodate these trends

Source: Stratas Advisors report Issued Jan 2016

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Audience Polling

What is the annual growth rate for FCC globally? 0.3%

0.5%

0.9%

3.1%

• Global FCC capacity today is 17.5 MB/D projected to increase by 18.4 MB/D by 2035 • That is roughly 0.3% annual growth rate

7.0 6.0

2015

5.0

2035

4.0 3.0 2.0 1.0 -

N. Asia Europe Latin CIS America Pacific America 0%

0%

-2%

1%

38%

ME

Africa

52%

105%

Source: Stratus Energy 2016 Cat-16-13

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

Market Trends



Ecat and Operating Benchmarking Trends



FCC Catalyst Proposal Request



Paths Forward

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

BASF maintains a database of equilibrium catalyst (Ecat), unit operation, and feed properties for FCC units across the world.



The database contains a diverse range of catalyst suppliers, unit designs, operating conditions and yields. ◦ Our Ecat database contains information for over 200 units ◦ Our unit operation database contains over 1,000 operating snapshots of over 250 units in the past 20 years.



From this, we can evaluate global and regional trends.

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 Benchmarking for ~200 FCC units by BASF  Shows yield slates vary greatly among the industry

Gasoline Yield, vol%

80 Max Gasoline

70

60

Max Distillate

50 Max Olefins

40 30 50

Yield Gasoline, vol% Cat-16-13

60

70 80 Conversion, vol%

Global Average

Global Min

Global Max

58

36

78

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90

100

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Max Propylene 40

25

Propylene, vol%

Max LCO

LCO, vol%

30 20 10

15 10 5 0

0

50

50

70 90 Conversion, vol%

Yield

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20

70 90 Conversion, vol%

Global Average

Global Min

Global Max

LCO, vol%

17

1

39

Propylene, vol%

9

3

24

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

Data used in Ecat trends analyses are from refineries all over the world.



Trends are compiled from 2002-2015 and represent global averages.



It is important to note that shifts in averages require large moves globally and are indicative of market pressures and market opportunities.



Ecat trends are broken out by region to differentiate regional market differences.



First half of data looks at Ecat properties, while second half of data looks ACE testing at constant conditions.

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100

80

38 41 40 38 38 37 39 38 43 48 45 51 52 48 Chart Legend

60

Resid

40 20

62 59 60 62 62 63 61 62 57 52 55 49 48 52

Gasoil

0

 Resid >3000 ppm Ni + V; Gasoil <3000 ppm Ni + V  Globally, more units are processing resid with the average moving from ~40% resid in the early 2000s, to today ~50% Cat-16-13

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Chart Legend



REO dropped starting in 2010 due to REO crisis. During this same time, many refiners also used less catalyst or reformulated resulting in lower activity after 2011.



An economic incentive for catalysts with less REO was present, which is why levels did not rebound when REO prices stabilized. However, REO levels have not reached historical maximum values.



North America is a gasoline driven market therefore higher REO; Asia is driven by propylene therefore lower REO.

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Chart Legend

 Surface area of catalyst is increasing due to refiners wanting more catalytic cracking- increased surface area results in increased activity.  Significant jump in TSA in 2011 to make up for lower REO during REO crisis.

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Chart Legend

 Overall increase in activity. With decrease in REO, Ecat activity dropped slightly. Recent rebound in activity resulting from increasing TSA and REO.  Hydrotreated feeds will lead to an increase in activity.  Low activity in Asia is due to resid feed processing, a result of higher contaminant metal content. Cat-16-13

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 An increase in Ni and V content globally indicates refineries are now processing more resid.

Chart Legend

 Asia processes very heavy feed resulting in highest Ni and V content globally.  NA has a steady trend due to hydrotreating of feed and processing of tight oil. Cat-16-13

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Chart Legend

 Since 2010, an increase in P content is visible indicating higher ZSM-5 usage and/or higher P content in the catalyst, but flat in the past few years  ZSM-5 usage is driven by economic incentives of C3 and C4 olefins and to a lesser degree octane  Biggest ZSM-5 users are in Asia, which has been decreasing in recent years Cat-16-13

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 Increased hydrogen yield follows the increase in Ni, a dehydrogenation catalyst.

Chart Legend

 Asia has the highest hydrogen & metals levels  Overall decrease in H2 selectivity despite increase in metals suggests that refiners are using resid technology (e.g.. FlexTec) or catalyst suppliers are just getting better! Cat-16-13

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Chart Legend

 There is overall increase in LPG- could be a result of ZSM-5 and/or REO.

 Asia has highest LPG yield due to increased use of ZSM-5.

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cv cv

cc vv

 Large increase globally is reflective of increasing olefin demand.

Chart Legend

 Increase in selectivities is accomplished by catalyst changes (lower REO/Z) and increase in ZSM-5 use.  Also indicates higher gasoline octane potential from the catalyst. Cat-16-13

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 Large increases globally, reflective of increasing demand for C4 olefins due to higher olefin demand.

Chart Legend

 Increase in selectivities is accomplished by changes to the catalyst such as lower REO and increased ZSM-5 use.  Also indicates higher gasoline octane potential from the catalyst. Cat-16-13

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 Lower global average is indicative of desire to produce LPG and/or LCO.

Chart Legend

 NA has historically been more gasoline driven, therefore shows higher than global average.

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 LCO trend in Asia is in line with lowest gasoline globally indicating a desire for LCO over gasoline.

Chart Legend

 High LCO demand before recession, since then slight rebound but not supported by economics to maximize LCO for most units

 Recent LCO trend is opposite LCO/BOT trend, indicating an activity effect. Cat-16-13

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

Data from refineries all over the world



Data separated by Resid vs. Gasoil



Data from RFP, modeling requests, and data reviews

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Chart Legend Gasoil

Resid Average

■ The slight increase in feed concarbon recently indicates heavier crudes being processed globally. ■ Concarbon content can also differentiate between gasoil and resid.

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Chart Legend Gasoil

Resid Average

■ Increased hydrotreating of feed, mostly in North America, leads to decreased Ni and V in gasoil units. ■ Larger gap between Gasoil & Resid Metals content

■ More emphasis on catalyst technology advances in the past decade to process resid feeds with higher metals contamination. Cat-16-13

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Benchmarking ROT

Riser Outlet Temperature

995

80

536

78

990 532 985 528 980 524 975

970 2002

Benchmarking Conversion

(°C)

Conversion (vol%)

(°F)

76 74

72 70

520 2004

2006

2008

2010

2012

2014

68 2002

2004

2006

■ The decrease in ROT suggests that refineries are pushing for more LCO or relying more on catalyst activity or cat/oil – the latter is supported by conversion data. ■ Refiners who process lighter feed often need to reduce ROT to avoid downstream constraints such as wet gas compressor limitations. Cat-16-13

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2008

2010

2012

2014

Chart Legend Gasoil Resid Average

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■ As in agreement with the ECat data, activity is increasing over the years ■ An increase in cat/oil after 2010 coincides with the decrease in catalyst activity during the REO crisis. Cat-16-13

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Chart Legend Gasoil Resid Average

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■ An increase in total LPG and LPG olefins is a result of higher catalyst activity and/or ZSM-5 usage. ■ Selectivity shift towards LPG also lead to a increase in LPG yield.

■ Trend is in-line with strong butylene and propylene demand. Cat-16-13

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Chart Legend Gasoil Resid Average

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Benchmarking Gasoline Endpoint

■ Refineries are trying to increase gasoline yields. This can be accomplished by higher catalyst activity and/or by increasing gasoline cutpoints – higher gasoline cutpoint is demonstrated here. ■ Between 2003 and 2007, refineries undercut gasoline due to regulatory restrictions around sulfur. Since then hydrotreating has been used more substantially increasing gasoline yield and decreasing the need to undercut. Undercutting also was done to increase LCO. Cat-16-13

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Chart Legend Gasoil Resid Average

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Benchmarking RON 94

Gasoline-RON-Total

93.5

Chart Legend

93

Gasoil 92.5

Resid Average

92

91.5 91 2002

2004

2006

2008

2010

2012

2014

■ RON can be increased by undercutting gasoline, higher ROT, ZSM-5, and lower REO/ZSA ■ RON has been decreasing, in-line with the lower ROT despite higher ZSM-5 usage

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■ A steady state/slight decrease in LCO due to changes in cutpoints and operating objectives is demonstrated. ■ Lower bottoms yield overall is a result of improved bottoms cracking, and since LCO is steady/decreasing, this is an activity effect. Cat-16-13

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Chart Legend Gasoil Resid Average

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

Market Trends



Ecat and Operating Benchmarking Trends



FCC Catalyst Proposal Request



Paths Forward

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Increase LCO Decrease delta coke

Increase delta coke Increase profit Increase C4 Olefins

Reduce catalyst cost

Decrease dry gas

Max conversion

Increase resid rate Reduce LPG make

Max propylene

Improve fluidization

Improve attrition

Lower gasoline sulfur

Improve metals tolerance

Increase Octane Increase Gasoline Cat-16-13

Reduce catalyst adds

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Audience Polling

BASF received over 200 proposal requests over the past 4 years globally.

What do you think was the #1 most frequent objective requested? 1

Improved metals tolerance

2

Increase LCO yield/selectivity

3

Increase LPG olefins/olefinicity

4

Increase bottoms upgrading



Global Results for Top Objectives

LPG= 56%

Bottoms Upgrading 57%

Maximize Conversion/ Volume 22% Cat-16-13

Decrease Dry Gas 52%

Increase Gasoline Octane 28% Page 36

Increase LCO 36%

Increase Gasoline 45%

Decrease Delta Coke 45%

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#1

#2

#3

#4

North America

Bottoms 68%

Dry Gas 58%

LPG= 47%

LCO 37%

Latin America

Gasoline 83%

LPG= 67%

Octane 42%

Bottoms 42%

Europe/ LPG= Middle East/ 53% Africa

Dry Gas 48%

Bottoms 47%

∆Coke 42%

Asia

LPG= 64%

∆Coke 64%

Bottoms 58%

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Gasoline 65%

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Global LPG Needs

C4s Only 17% C3= & C4s 50% C3= Only 33%

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Both

C3=

C4s

North America

24%

3%

22%

Latin America

33%

33%

8%

Europe, Middle East, Africa

44%

8%

5%

Asia

19%

42%

6%

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Both increasing LPG olefin make and reducing dry gas make continue to be important today vs. 2013-2014



More focus on bottoms upgrading

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Shifting from LCO to Gasoline ◦ 50% decrease in requests to increase LCO ◦ 20% increase in requests to increase Gasoline



Increasing request for Iron tolerance

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Audience Polling

What percentage of customers did not issue a formal RFP in the past 4 years? 25%

50%

75%

Annual 1%

Biennial 10%

No Bid ~50%

3-4 Yrs 40%

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

Market Trends



Ecat and Operating Benchmarking Trends



FCC Bid Statistic Trends

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Paths Forward

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 

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FCC capacity to grow at 0.3% per year, but will see rationalization in some areas including Europe Short term need for Gasoline and Octane Long term growth of Distillate outpaces that of Gasoline Demand for LPG olefins ◦ C3=‘s for Petrochemical demand ◦ iC4s and C4= for Alky (octane)

 

Increasing environmental regulations FCC will continue to need to be flexible to meet the coming demands

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Technology Platforms Product R&D Cat-16-13

Next generation high conversion (post DMS)

Heavier crudes to refineries

Growing petrochemicals demand

Incremental demand for LCO over gasoline

Special market drivers

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