REFINERY OPERATIONS
They need to ask a number of key questions. Is
the plan the optimum and should we stretch it? Is it fit for purpose? Does the plan provide a true representation of the capabilities of the refinery and how resilient is it? These kinds of considerations also need to take
into account not just the current status that the plant is operating under, but also the likely changes over time. Planning models when first developed usually reflect reality based upon the criteria known at the point of design. However, changes to the refinery mean the model will require modifications over time or inevitably inaccuracies will occur. Therefore, updating the planning model becomes necessary with planners needing to decide how often to make necessary alterations. The best practice is to use engineering simulation models (process and rigorous reactor models) to update the planning model. Engineering models may require tuning to current operations, but there is a growing awareness that their usage is becoming critical to delivering optimum planning models. A blend of planning and engineering tools from
a process optimisation provider like AspenTech is likely to provide a powerful solution in this context. [In this scenario, for example, a combination of Aspen HYSYS Petroleum Refining, a core element of aspenONE® Engineering for Refining, Marketing and planning tool, and Aspen PIMS Advanced Optimization (PIMS-AO) will provide the level of accuracy required].
Refining Industry At the beginning of the year, refiners were bracing for losses
in all regions as margins (crack spreads) plunged. For example, in Europe, refining margins fell to $2.5 a barrel recently. The economic downturn, overcapacity, and growing competition from super-refineries in Asia are all cited as responsible. Capacity additions in the non-OECD are set to continue at
record pace (additions in China and India alone total 4 mb/d this year, far outpacing expected global oil demand growth of 1.2 mb/d according to Barclays Capital). However, the good news for the profitable refineries is that
while the process has been stubbornly slow, closures of non- profitable refineries are finally gaining momentum. “With crude oil prices high and likely to remain high, margins are set to remain under pressure, and we would expect further closures of simple, non-profitable refineries in both the US and Europe as the year progresses,” say BarCap. The net result could be one where the global refining picture
looks more favourable towards the end of 2012, albeit only just. The real problem is not just that there is excessive distillation
capacity but rather that existing refineries, particularly in Europe, are in the wrong place and make the wrong products. From 2009-2014, Deutsche Bank estimate that nearly 5
mb/d of refinery capacity (or 6% of global capacity referencing 2008 capacity) will be permanently idled based on current assessments of announced closures. This count may grow as they see an additional 2 mb/d of capacity up for sale, which tends to be a precursor for eventual closure.
Just as with the planning process,
Dealing With Risk Any refinery plan must be able to effectively manage risk. This
is always a difficult challenge. Key input variables in planning can have a large degree of uncertainty associated with them – feedstock and product prices being just two examples. In the course of the planning process, refineries will typically
need to make assumptions and even informed guesses about the values of these variables in the future. Inaccuracies in these guesses will result in significant gaps between planned and actual profitability. The traditional approach in dealing with this is to perform
scenario analysis. Typically, this requires the time consuming definition of a large number of cases. Incorporating risk analysis can help in developing more resilient plans that are more likely to be achievable.
Key Role of Scheduling Scheduling is closely linked to planning, but is typically
more about feasibility and less about economic optimisation. Planning output is typically delivered to the refinery and the refinery scheduler teams. The schedulers then take the plans and convert them into hour-by-hour actions. A sensible approach to scheduling, however, should not only look at the various options for achieving the plan, but also provide the ability to react quickly to deviations from that plan.
refinery management should be continuously ‘questioning’ the scheduling approach. Key questions typically asked include; Are the plans and schedules aligned? What is the feedback to the planning process? How quickly can the schedulers cope with unplanned events and can they evaluate opportunistic sales/ purchases in the needed timeframe? Here, solutions like AspenTech’s
Aspen Petroleum Scheduler that comes with a PSMA (Planning & Scheduling Model Accuracy) tool that facilitates and automates the process of model accuracy tracking, can play a key role.
Managing Energy Another key area that refinery management needs to focus on in meeting plan is energy management. Refineries are extremely high consumers of energy. After all, approximately 40% of a refinery’s
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