Feasibility Study on Reduction of Greenhouse Gas Emissions at Thanlyin Oil Refinery by the Modernization of Existing Facilities
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N E DO- I C-OOER3 1 Feasibility Study on Reduction of Greenhouse Gas Emissions at Thanlyin Oil Refinery by the Modernization of Existing Facilities March, 2001 New Energy and industrial Technologies Development Organization (NEDO) Entrusted to Cosmo Engineering Co, , Ltd. 020005096- Feasibility Study on Reduction of Greenhouse Gas Emissions at Thanlyin Oil Refinery by the Modernization of Existing Facilities Cosmo Engineering Co., Ltd. March, 2001 Study Purpose; At the Third Conference of the Parties to the United Nations Framework Convention on Climate Change (COP 3), "The Kyoto Protocol” defining a target of the reduction of greenhouse gases such as carbon dioxide for the industrialized countries was adopted to prevent the ongoing global warming. Here, the international remedies such as "Jointed Implementation (JI)” and “Clean Development Mechanism (CDM)" are determined to flexibly trade the amount of the countries’ reduction through actual implementation of projects. Japan should also utilize these means to achieve our target. This report summarizes the survey for a project of energy saving and greenhouse gas reduction by introducing modern refinery facilities to Thanlyin Refinery, Myanma Petrochemical Enterprise and for future CDM. NEDO—IC—OOER31 Feasibility Study on Reduction of Greenhouse Gas Emissions at Thanlyin Oil Refinery by the Modernization of Existing Facilities March, 2001 New Energy and Industrial Technologies Development Organization (NEDO) Entrusted to Cosmo Engineering Co., Ltd. Preface This report summarizes “The 2000 Basic Investigation on Collaborations and Others: Feasibility Study on Reduction of Greenhouse Gas Emissions at Thanlyin Refinery by Modernization of Existing Facilities” carried out by Cosmo Engineering Co., Ltd. in commission by “New Energy and Development Organization (NEDO).” First, as the background of this investigation, we should mention the Third Conference of the Parties to the United Nations Framework Convention on Climate Change (COP-3) in December 1997. The Kyoto Protocol defines the target that the industrialized counties should achieve 5% reduction of the greenhouse gases, such as C02, by 2008 to 2012 based on the amount generated in 1990. As for Japan, we should reduce the amount by 6%. In addition, the convention suggested the international remedies such as “Jointed Implementation, JI,” among the industrialized countries and "Clean Development Mechanism, CDM,"between the industrialized countries and the developing countries and “Emissions Trading” At Thanlyin Refinery of Myanma Petrochemical Enterprise, Myanmar, we expect the possibility of reducing a large amount of the greenhouse gases, C02 and Methane Our field survey will lead to an effective energy-saving project to improve the crude oil distillation unit and the coker plant. Also, this survey aims the possibility of applying "CDM." Lastly, we hope this report will effect the implementation of the project and appreciate many officials of Myanmar’s Energy Planning Department, business people in MPE and many other people concerned for their cooperation. March 2001 Cosmo Engineering Co., Ltd. Contents Preface Contents Summary Chapter 1 General 1.1 Internal Situation in Myanmar ............................................................... 1-1 1.1.1 Political, Economical and Social Situation ..................................... 1-1 1.1.2 Energy Situation .............................................................................. 1-8 1.1.3 Necessity for a Clean Development Mechanism (CDM) Project ••• 1-12 1.2 Necessity for Introduction of the Energy Saving Technology in the Target Industry ......................................................................................... 1-14 1.3 Significance, Necessity and Dissemination Effect on Related Industry • 1-15 Chapter2 Concretization of the Project 2.1 Project Planning ........................................................................................ 2-1 2.1.1 Overview of the Project Area ....................................................... 2-1 2.1.2 Contents of the Project .................................................................. 2-6 2.1.3 Greenhouse Gases and Others Targeted Gases ......................... 2-7 2.2 Overview of the Project Site ...................................................................... 2-8 2.2.1 Interests of the MPE ...................................................................... 2-8 2.2.2 Conditions of the Related Facilities (Overview, Specifications and Operation Conditions) of the Project Site (MPE) .............. 2-9 (1) Overview of The Facilities at MPE Thanlyin Refinery ................ 2-9 (2) Operation Conditions at MPE Thanlyin Refinery ....................... 2-13 (3) Refining System Studied ........................................:..................... 2-18 (4) Analysis of the current operation ............................................... 2-46 2.2.3 Project Capability at the Project Site (MPE) ................................. 2-69 (1) Technical Skills ............................................................................. 2-69 (2) Management System ...................................................................... 2-69 (3) Management Basis and Policies ................................................... 2-70 (4) Financial Capability ...................................................................... 2-72 (5) Human Resources Power ............................................................... 2-73 (6) Implementation structure ............................................................... 2-73 2.2.4 Project Contents at the Project Site (MPE) and Specifications of the Modified Facilities .................................................................. 2-74 (1) Energy-Saving Plan by Replacing the Heat Exchangers in Heat Recovery System ............................................................................. 2-74 (2) Furnace ............................................................................................ 2-80 (3) New Power Plant (Item -F) 2-89 (4) Recovery of Steam Loss (Item -G) .............................................. 2-90 (5) Modernization of Cooling Water System (Item -H) 2-91 (6) Off-Gas and LPG Recovery (Item -J and K) ................................. 2-92 (7) Modernization of Intermediate Product run-down System (Item -L) 2-94 2.2.5 Scope of the Project: Funds, Facilities and Services .................. 2-96 (1) Scope of work by the Japan Side .................................................... 2-96 (2) Scope of work by the Myanma Side ................................................ 2-96 2.2.6 Conditions and Issues for the Implementation ................................. 2-96 2.2.7 Project Schedule ................................................................................ 2-97 2.3 How to Finance ............................................................................................... 2-98 2.3.1 Fund Plan to Implement the Project (Amount, Arrangement, etc) ............................................................................................ 2-98 2.3.2 Fund RaisingPlan .......................................................................... 2-100 2.4 Conditions of CDM(Clean Development Mechanism) ......................... 2-101 2.4.1 Cordination for Realization of CDM ............................................ 2-101 2.4.2 Possibility of Approval as CDM Project ......................................... 2-101 Chapters Project Effect 3.1 Energy Conservation Effect ......................................................................... 3-1 3.1.1 Technical grounds of Energy Conservation Effect ...................... 3-1 3.1.2 Basehne for Calculation of Energy Conservation Effect ........... 3-4 (1) Setting of Baseline .......................................................................... 3-5 (2) Summary of Calculation ............................................................... 3-6 3.1.3 Actual Energy Savings, Energy Saving Term and Cumulative Totals ................................................................................................... 3-7 (1) Energy Conservation Effect ........................................................... 3-7 (2) Summary of Calculation ............................................................... 3-8 3.1.4 Verification of Actual energy Conservation Effect ...................... 3-9 3.2 Greenhouse Gas Reduction Effect ............................................................. 3-10 3.2.1 Technical grounds of Greenhouse Gases Reduction Effect ....... 3-10 3.2.2 Basehne for Calculation of Greenhouse Gases Reduction Effect”* 3-11 (1) Setting of Baseline .......................................................................... 3-11 (2) Summary of Calculation ............................................................... 3-13 3.2.3 Actual Greenhouse Gases Reduction, Effective Term and Cumulative Reduction ................................................................... 3-14 3.2.4 Verification of Actual Greenhouse Gases Reduction Effect (Monitoring) ................................................................................... 3-17 3.3 Effect on Production ................................................................................. 3-18 3.3.1 Fuel Reductions in furnace ........................................................... 3-18 3.3.2 LPG Recovery ................................................................................. 3-18 3.3.3 Increase of fuel production via recovery