Cracking Of Crude Oil Products

[Rosalyn Pomposo]

Modernseparation involves piping crude oil through hot furnaces. The resulting liquids and vapors are discharged into distillation units. All refineries have atmospheric distillation units, but more complex refineries may have vacuum distillation units.

Inside the distillation units, the liquids and vapors separate into petroleum components, called fractions, according to their boiling points. Heavy fractions are on the bottom and light fractions are on the top.

After distillation, heavy, lower-value distillation fractions can be processed further into lighter, higher-value products such as gasoline. At this point in the process, fractions from the distillation units are transformed into streams (intermediate components) that eventually become finished products.

The most widely used conversion method is called cracking because it uses heat, pressure, catalysts, and sometimes hydrogen to crack heavy hydrocarbon molecules into lighter ones. A cracking unit consists of one or more tall, thick-walled, rocket-shaped reactors and a network of furnaces, heat exchangers, and other vessels. Complex refineries may have one or more types of crackers, including fluid catalytic cracking units and hydrocracking/hydrocracker units.

Alkylation, for example, makes gasoline components by combining some of the gaseous byproducts of cracking. The process, which essentially is cracking in reverse, takes place in a series of large, horizontal vessels and tall, skinny towers.

The finishing touches occur during the final treatment. To make gasoline, refinery technicians carefully combine a variety of streams from the processing units. Octane level, vapor pressure ratings, and other special considerations determine the gasoline blend.

Both incoming crude oil and the outgoing final products are stored temporarily in large tanks on a tank farm near the refinery. Pipelines, trains, and trucks carry the final products from the storage tanks to locations across the country.

The energy markets at CME Group serve as a means of price discovery for the international marketplace. The crude oil, gasoline and diesel (ULSD) derivatives contracts offered at CME Group under the rules and regulations of NYMEX, a CME Group exchange, are reliable risk management tools that serve as global benchmarks. All contracts provide the safety and security of central clearing through CME Clearing, whether they are exchange-traded futures contracts or contracts traded over-the-counter and submitted for clearing through CME ClearPort.

A petroleum refiner, like most manufacturers, is caught between two markets: the raw materials he needs to purchase and the finished products he offers for sale. The price of crude oil and its principal refined products are often independently subject to variables of supply, demand, production economics, environmental regulations and other factors. As such, refiners and non-integrated marketers can be at enormous risk when the price of crude oil rises while the prices of the refined products remain stable, or even decline.

Such a situation can severely narrow the crack spread, which represents the profit margin a refiner realizes when he procures crude oil while simultaneously selling the refined products into a competitive market. Because refiners are on both sides of the market at once, their exposure to market risk can be greater than that incurred by companies who simply sell crude oil, or sell products to the wholesale and retail markets.

In addition to covering the operational and fixed costs of operating the refinery, refiners desire to achieve a rate of return on invested assets. Because refiners can reliably predict their costs, other than crude oil, an uncertain crack spread can considerably cloud understanding of their true financial exposure.

An independent refiner who is exposed to the risk of increasing crude oil costs and falling refined product prices runs the risk that his refining margin will be less than anticipated. He decides to lock-in the current favorable cracking margins, using the 3:2:1 crack spread strategy, which closely matches the cracking margin at the refinery.

When refiners are forced to shut down for repairs or seasonal turnaround, they often have to enter the spot crude oil and refined products markets to honor existing purchase and supply contracts. Unable to produce enough refined products to meet supply obligations, the refiner must buy products at spot prices for resale to customers. Furthermore, lacking adequate storage space for incoming supplies of crude oil, the refiner must sell the excess crude oil in the spot market.

The vast majority of plastic in use today is synthetic because of the ease of manufacturing methods involved in the processing of crude oil. However, the growing demand for limited oil-reserves is driving a need for newer plastics from renewable resources such as waste biomass or animal-waste products from the industry.

3. Polymerisation is a process in the petroleum industry where light olefin gases (gasoline) such as ethylene, propylene, butylene (i.e., monomers) are converted into higher molecular weight hydrocarbons (polymers). This happens when monomers are chemically bonded into chains. There are two different mechanisms for polymerisation:

Condensation polymerisation includes joining two or more different monomers, by the removal of small molecules such as water. It also requires a catalyst for the reaction to occur between adjacent monomers. This is known as step growth, because you may for example add an existing chain to another chain. Common examples of condensation polymers are polyester and nylon.

In compounding, various blends of materials are melt blended (mixed by melting) to make formulations for plastics. Generally, an extruder of some type is used for this purpose which is followed by pelletising the mixture. Extrusion or a different moulding process then transforms these pellets into a finished or semi-finished product. Compounding often occurs on a twin-screw extruder where the pellets are then processed into plastic objects of unique design, various size, shape, colour with accurate properties according to the predetermined conditions set in the processing machine.

Plastics are high molecular weight organic polymers composed of various elements such as carbon, hydrogen, oxygen, nitrogen, sulphur and chlorine. They can also be produced from silicon atom (known as silicone) along with carbon; a common example is silicone breast implants or silicone hydrogel for optical lenses. Plastics are made up of polymeric resin often mixed with other substances called additives.

'Plasticity 'is the term used to describe the property, feature and attribute of a material that can deform irreversibly without breaking. Plasticity describes whether a polymer would survive the temperature and pressure during the moulding process.

Chemistry allows us to vary different parameters to tune the properties of polymers. We can use different elements, change the type of monomers, and rearrange them in different patterns to change the shape of polymer, its molecular weight or other chemical/physical properties. This allows plastics to be designed to have right properties for a specific application.

Hydrocarbons are organic compounds (can be aliphatic or aromatic) made up of carbon and hydrogen. Aliphatic hydrocarbons have no cyclic benzene rings while the aromatics have benzene rings.

Carbon (C, atomic number = 6) has a valency of four, meaning it has four electrons in the outermost shell. It is able to pair up with four other electrons from any element of the periodic table to make up chemical bonds (for hydrocarbon, it will pair up with hydrogen). Hydrogen on the other hand (H, with atomic number = 1) has only one electron in the valence shell so four of these H-atom are ready to be paired up with C-atom by forming a single bond to give a C-H4 molecule. CH4 molecule is called methane, which is the simplest hydrocarbon and the first member of the Alkane family. Similarly, if two C-atoms would bond together they can link with up to six H-atoms with three being on each C-atom to give a chemical formula of CH3-CH3 (or C2H6) known as ethane and the series goes on as follows.

Scientists have also questioned this theory. A recent study in Nature Geoscience from Carnegie Institution in collaboration with Russian and Swedish colleagues revealed that the organic matter may not be the source of heavy hydrocarbon and that they could be existing already deep down in the Earth. Experts discovered that ethane and other heavy hydrocarbons could be made if the pressure-temperature conditions can be mimicked with those present deep inside the Earths core. This is to say that hydrocarbons can be made in the upper mantle that is the layer of Earth between the crust and the core. They demonstrate it by subjecting methane to laser heat-treatment in the upper layer of the Earth that then transformed into hydrogen molecule, ethane, propane, petroleum ether and graphite. The scientists then exposed ethane to the same conditions which reversibility produced methane. Above findings indicate that these hydrocarbons might be created naturally without the remains of plants and animals (ref).

Extraction of oil - Oil is pumped from underground to the surface where tankers are used to transport the oil to the shore. Oil drilling can also take place under the ocean using support from platforms. Different size pumps can produce between 5 - 40 litres of oil per stroke (Figure 1).

Refining of oil - Oil is pumped through a pipeline that can be thousands of miles long and transported to an oil refiner (Figure 1). Spillage of oil from the pipeline during transfer can have both immediate and long-term environmental consequences but safety measures are in place to prevent and minimise this risk.

Distillation of crude oil and production of petrochemicals - Crude oil is a mixture of hundreds of hydrocarbons that also contains some solids and some gaseous hydrocarbons dissolved in it from the alkane family (mainly it is CH4 and C2H6, but it can be C3H8 or C4H10). Crude oil is first heated into a furnace then the resultant mixture is fed as a vapour to the fractional distillation tower. The fractional distillation column separates the mixture into different compartments called fractions. There exists a temperature gradient in the distillation tower where the top is cooler than the base. The mixture of liquid and vapour fractions gets separated in the tower depending on their weight and boiling point (boiling point is the temperature at which the liquid phase changes into gaseous). When the vapours evaporate and meet a liquid fraction whose temperature is below the boiling point of vapor, it partly condenses. These vapours of evaporating crude oil condense at different temperature in the tower. Vapours (gases) of the lightest fractions (gasoline and petroleum gas), flow to the top of the tower, intermediate weight liquid fractions (kerosene and diesel oil distillates), lingers in the middle, heavier liquids (called gas oils) separate lower down, while the heaviest fractions (solids) with the highest boiling points remain at the base of the tower. Each fraction in the column contains hydrocarbons with a similar number of carbon atoms, smaller molecules are towards the top and longer molecules nearer the bottom of the column (Ref). In this way, petroleum is decomposed into petroleum gas, gasoline, paraffin (kerosene), naphtha, light oil, heavy oil, etc.

3a8082e126