Transcript 201102250842310.THE ECONOMICS ASSOCIATION OF ZAMBIA

THE ECONOMICS ASSOCIATION OF ZAMBIA
IS INDENI THE BEST POSSIBLE OPTION FOR
ZAMBIA FUEL SUPPLY?
P. CHISALE ( PhD, MSc., MEIZ, MZAA, REng.),
Senior Lecturer, Thermal Fluids,
Department of Mechanical Engineering,
School of Engineering,
The University of Zambia.
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011
ORDER OF PRESENTAION
HISTORY OF INDENI PETROLEUM REFINERY COMPANY LIMITED
CRUDE SUPPLY AND LOGISTICS CHAIN
PLANT DESIGN CONFIGURATION
PRODUCTION HISTORY
IS INDENI THE BEST POSSIBLE OPTION FOR ZAMBIA FUEL SUPPLY?
WAY FORWARD
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011
HISTORY OF INDENI PETROLEUM REFINERY COMPANY LIMITED
The Indeni Petroleum Refinery was commissioned in 1973.
It is situated in Ndola, in the Copperbelt Province of Zambia. It was
designed by SNAM-PROGETTI, an Italian based company.
The role of the Refinery was to process spiked crude to meet the
petroleum product requirement of the Zambian Market and also
supply of excess products to markets to the neighboring countries
in the region.
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011
Zambia, being a land locked country; the Refinery’s crude is
supplied through a 1, 700 km TAZAMA pipeline from Das-esSalaam in Tanzania to Bwana Mkubwa in Ndola, Zambia.
Ndola
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011
PLANT CRUDE SUPPLY AND LOGISTICS CHAIN
Crude was originally supplied through Zambia National Oil Company (ZNOC), and
the refinery performed its traditional specialized role of processing crude and
collecting a processing fee.
After ZNOC, the Government has been appointing suppliers of crude to the refinery.
Between 2002 and 2003 the two shareholders agreed to organize the supply
themselves and TOTAL was appointed to supply crude to the Refinery. In 2007, the
shareholders agreed that GRZ will also exercise its right to take over the supply of
crude to the refinery.
Effective January 2007, TP Ltd also took over responsibility of the finished product
storage terminal in Ndola and incorporated the responsibilities for delivery logistics
of Indeni finished products to the Oil Marketing companies (OMC’s).
The supply logistics chain of the Refinery starts from Dar-es-Salaam in Tanzania,
where Crude cargo vessels offload the crude product via dedicated offshore crude
lines into the TAZAMA Pipeline Limited storage.
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011
Storage and Logistic under control
Indeni Petroleum Refinery Company
• 3 Crude Oil Tanks
• 60,000m3
• Dar-es-Salaam, Tanzania
Import / Export
Storage
•
•
Pipeline
Design capacity
117,000m3
Refinery Storage Capacity
84,250m3
• 1.1 x 106 MT/YR (Design)
• 850,000 MT/YR (Current)
Refinery
Storage
Fuel Terminal Storage 75240m3
(TAZAMA since 01/01/07)
Fuel Terminal
storage
3
© Indeni Petroleum Refinery Company Ltd
Fig. 4. INEDNI Supply and Logistics Chain
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011
PLANT DESIGN CONFIGURATION
The Indeni Petroleum Refinery Limited was originally designed as a
20 KBD hydro skimming plant, designed to refine fresh feed blend of
77.5% Iranian light oil and 22.5% Gasoil + Heavy Naphtha.
It was designed to process 1.1 million MT/ Yr of crude. Current
operational capacity has been reduced to 850, 000 MT/ Yr due to
reconfigured commingled stock to meet the evolving market
demand.
The products market demand structure is now mainly more Gasoil
and less Petrol as compared to the market demand structure when it
was originally designed.
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011
The Refinery can process 139 t/h or 1.1 million t/yr. In practice the Zambian
market can only absorb around 500,000 t/y of products reducing the crude
rate to about 550,000 t/y.
As a result the imported crude is heavily ‘spiked’ with lighter fractions such
as naphtha, condensates and gas oil. At the present time about 50% of the
crude is spiked with light fractions which have been co-mingled before
shipping. The effect of this spiking reduces the maximum crude throughput
of the Refinery from 1.1 to 0.85 million metric tons per year.
The reduced crude rate and spiking limits the ability to preheat crude
because of the greatly reduced residue production.
Also the lighter fractions load up the top of the crude column whilst leaving
the lower column underutilised. In addition it has become progressively more
difficult to sell residue products
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011
Table 1: Inventory Levels Throughputs
No.
Storage Facility
Capacity (m3)
1
Petrol Components Storage
2,400.00
2
Naptha Storage
9,000.00
3
Residuals (Fuel Oil) Storage
33,800.00
4
LPG Storage
1,800.00
5
Petrol Storage
9,000.00
6
Diesel Storage
17,500.00
7
JET Fuel Storage
6,100.00
8
Asphalt Storage
3,200.00
9
Feedstock Storage
60,000.00
10
Other Intermediary Products storage
1,450.00
11
Total Storage Capacity
144,250.00
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011
PRODUCTION HISTORY
The production of petroleum products at the refinery for January to June
2007 were more than January to June 2006. This production was as planned
but in some cases more than the planned volumes. Historical Consumption
and losses was planned at 10%, although performance w as above.
PRODUCTION (Throughput)
60
50
KT
40
Actual 2006
30
Actual 2007
Plan 2007
20
10
Jan
Feb Mar April May Jun
July Aug Sept Oct
Nov Dec
Figure 1. Production
After the phase I works of the recapitalization programme which
was mainly on reliability issues, average consumption and losses
stood at 8.03%.
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011
IS INDENI THE BEST POSSIBLE OPTION FOR ZAMBIA FUEL
SUPPLY?
NOT IN THE CURRENT TECHNICAL STATE OF INDENI AND PRICING
SYSTEM.
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011
WAY FORWARD
The status of the pipeline needs establishing before a way
forward can be prescribed.
The corrosion monitoring and control seems inadequate this
has resulted in the pipeline being weak in some areas.
Resulting in the line not being able to hold high pressures,
hence not being able to transmit higher volumes.
Possibility of a parallel line to allow for flexibility should be
evaluated against rehabilitating the current line. The
possibility of a parallel supply line may be from a different
routing e. g. Angola.
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011
Investigations to assess the possibility of increasing tankage
capacity so that a buffer capacity is developed which can cushion
price fluctuations at the same time this buffer will act as strategic
reserves (Done 2009, 2010). This has result only in smooth
transition from operation to shutdown and vice-versa and not
price and delivery costs.
Viability of possible rehabilitation of the offloading point should be
evaluated. A strategy needs to be devised to ensure that the point
serves the interest of Zambia and that Zambia has some degree of
control in this facility.
Financial strategy will require developing to ensure that financing of
maintenance is sustained.
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011
Investment in a Hydrotreater and a hydrogen plant. Investments in
other sulphur removal steps like Mercaptan oxidation (Merox) to
further enhance the capacity to reduce sulphur.
Sustainable production of Unleaded petrol; Installing an
Isomeriser to to boost the octane for Light Naphtha which is
currently added to this pool straight run. This will ensure that
there is sustainable octane above 93. Consideration must be made
for use of other additives to boost octane.
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011
INDENI
INDENI PETROLEUM REFINERY COMPANY LTD.
SIMPLIFIED REFINERY FLOWS
INDENI
FUEL GAS
LPG & BUTANE
FRACTIONATION
(SECONDARY UNIT)
LT GASOLINE
JET A1
HEAVY
GASOLINE
OVERHEAD
HYDROTREATING
(HYDROTREATER)
SPIKED
CRUDE
TOPPING
CRUDE
UNIT
(PRIMARY UNIT)
H2
LPG
KERO
KEROSENE
REFORMING
UNIT
REFORMATE
L.S.GASOIL
LT GASOIL
HVY GASOIL
GASOIL
FUEL OIL
BITUMEN
VACUUM
UNIT
5
BITUMEN OXIDATION
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011
OX BITUMEN
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011
END OF PRESENTATION
Thank you
TAJ-PAMODZI HOTEL, LUSAKA, 24TH FEBRUARY, 2011