Light Olefins – Challenges from New Production Routes ? H

Home , Steam cracking

Opportunities and Challenges at the Interface between Petrochemistry and Refinery DGMK/SCI-Conference October 10-12, 2007, Hamburg, Germany

Light Olefins – Challenges from new Production Routes ? H. Zimmermann Linde Engineering, Pullach, Germany

Abstract Light Olefins are the building blocks for many modern plastic products and are produced in large quantities. Driven by high crude oil prices, production is shifted to regions with low cost raw materials. Alternatives to the traditional production from Naphta, AGO and other crude products are becoming attractive. This paper evaluates several methods Ethylene and Pro- pylene production economically and also the regional advantageous routes. The analysis includes Steamcracking, dehydrogenation, dehydration of Ethanol, Methanol based routes and olefin conversion by Metathesis.

Introduction

Almost 200 million t/a of light olefins are produced and processed to a variety of products. The production of the bulk products Ethylene and Propylene is traditionally based on Steam- cracking and separation of off-gases from refinery processes. However, today, with the dramatic change of raw material costs due to crude oil price development, a number of new processes are being utilized for the production of light olefins.

1. Light Olefin Production Routes

The petrochemical production routes for light olefins are Steamcracking of hydrocarbons from Ethane to Naphta, AGO and even Hydrocracker bottoms, dehydrogenation of hydrocarbons, dehydration of alcohol, Methanol based routes and Metathesis.

Economic comparison of the different routes is complex, since some routes (Naphtacracking) produce many valuable by-products. A first comparison can be made on the basis of selectivity of the routes as shown in Fig. 1.

Due to the low conversion per pass, the Dehydrogenation of Ethane can be excluded for commercial production, as this route is not competitive to cracking of Ethane. The other processes have to be evaluated in detail in order to see the commercial competitiveness.

2. Steamcracking of Hydrocarbons

Steamcracking of hydrocarbons is the most important method of producing Ethylene and Propylene today. Ethylene production is almost exclusively utilizing this route, whereas 70 % of the Propylene is produced via Steamcracking today. Steamcracking technology has been used for more than 50 years and can be summarized as shown below in Fig. 2.

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Linde Engineering Light Olefins – Production Routes

Selectivity % Conversion %

Cracking of Ethane 82-84 64-75 Dehydro of Ethane 80 15-20 Dehydration of EtOH 97 -99 70-100 MTO 70 (E+P) 100 MTP 70 (P) 100 Metathesis 90 Dehydro of Propane 85-90 35-50

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Fig. 1: Light Olefin Production Routes

Linde Engineering Steamcracking

Steam Feed C2 H 4 , C 3 H 6 , C 6 H 12 , C H 4 + PyGas (C5-C10) +PFO(C10+ ) 820 -860 °C 0,2-0,5 sec

Feed Steam / Feed (Typical)

Ethane 0, 3 ( wt/wt) Propane 0,4 Naphta 0,5 AGO 0,6 HVGO 0,8

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Fig. 2: Steamcracking of Hydrocarbons

The cracking reaction is carried out in cracking furnaces as shown in Fig. 3.

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Linde Engineering Steamcracking Furnace

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Fig. 3: Cracking Furnace

Modern Steamcracking Plants have capacities of up to 1.5 million t/a Ethylene and a total olefin production (Ethylene + Propylene) up to 1.8 million t/a. Investment costs for such plants are in the range of 1 billion Euros.

A typical view of a cracker is shown in Fig. 4.

Linde Engineering 3D Model View of a Steamcracker

260 m

230 m

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Fig. 4: 3D View of a Steamcracker

Typical cracking yields for the different feedstocks are shown in Fig. 5.

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Linde Engineering Steam Cracking Yields ( wt % ex Furnace)

Feedstock Ethane Propane FR Naphtha AGO HCR

H2 + CO 4.06 1.70 1.03 0.71 0.68

CH4 3.67 23.37 15.35 10.69 9.38

C2H2 0.50 0.67 0.69 0.34 0.43

C2H4 52,45 39.65 31.02 24.85 29.64

C2H6 34.76 4.57 3.42 2.75 2.77

C3H6 + C3H4 1.15 13.28 16.21 14.28 16.83

C3H8 0.12 7.42 0.38 0.31 0.37

C4 2.24 4.03 9.54 9.61 11.17

Pyrolyis Gasoline 0.87 4.27 19.33 20.6 17.73

Pyrolysis Fuel Oil 0.16 1.11 3.01 15.78 10.98

Dilution Steam / HC 0.30 0.35 0.50 0.80 0.80

Total HC Load 100% 132% 169% 211% 177%

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Fig. 5: Cracking Yields

As can be seen from the Fig. 5 Ethane can be cracked very selectively compared to Ethyl- ene, whereas all other feedstocks produce significant quantities of by-products such as Methane, Propylene, C4- cut, Benzene, Pygas (Pyrolysis Gasoline) and Pyrolysis Fuel Oil (PFO).

The attractiveness of Ethane cracking can be explained by the selectivity but also the regionally advantaged Ethane price contributes to the outstanding economics of Ethane cracking. Costs of 0,75 to 1,6 USD per MM BTU equivalent to 40 to 85 USD /t are typical for Middle East locations and countries like Venezuela, where several cracker projects are in the planning phase.

Low cost Ethane cracking has an advantage of 300 to 400 USD per t of Ethylene in production costs compared to Naphta cracking at market price. The huge difference is the driver for all new investments in areas with advantaged feedstock costs as shown in Fig. 6.

Linde Engineering Market - Feedstocks

Key Areas of Oil & Gas Exploration

Norway

Caspian China

Egypt Gulf Algeria of Mexico South East Asia Peru, West Colombia, Africa Middle East Ecuador and countries Iran, Venezuela Iraq, Qatar, UAE

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Fig. 6: Key Areas with advantaged feedstock costs

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The detailed comparison of Ethylene production costs by cracking of Ethane and Naphta is shown in Fig. 7 on the basis of a 1 million t/a cracker including raw materials, capital costs, operation costs as well as overhead and maintenance costs.

Linde Engineering Comparison Ethane / Naphtacracker (Basis 1MM MTA) Production Costs 2007

USD /t Ethylene

Overhead 900,00 Operation 800,00 Raw Material 700,00 Depreciation 600,00

500,00

400,00

300,00

200,00

100,00

0,00 Naphta / Europe fully depreciated Ethan Naphta Plant Linde AG Geschäftsbereich Linde Engineering 24 Zimmermann / DGMK 2007t

Fig. 7: Comparison of Ethane and Naphta cracking

Fig. 7 also indicates that a fully depreciated cracker in Europe has excellent economics but cannot reach the production cost of an Ethane cracker.

However, Ethane availability is limited in the Middle East and other raw materials have to be utilized. Fig. 8 shows a comparison between new Saudi Cracker economics and an existing European cracker and one can see that due to a discount of 30% for some feedstocks, cracking in this area is advantaged. Without the discount, the situation would be different and the European cracker would be quite competitive.

Linde Engineering Saudi Crackers (new) compared with European (existing) Discount of 30% on Propane and Butane

USD / ton of Ethylene

900

800

700

600

500

400

300

200

100

0 Ethan E/P 50/50 Butan E/B 50/50 Naphta / Europe

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Fig. 8: Comparison of Crackers based on different feedstocks

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3. Alternative Processes for Ethylene Production

An alternative route for production of Ethylene is the dehydration of Ethanol, which has a very high selectivity. A summary of the production costs by Ethanol dehydration are shown in Fig. 9.

Linde Engineering Dehydration of Ethanol

C2H5OH ------ÆC2H4 + H2O ( Cat , 300°C)

Production: 500 000 MTA Ethylene Per ton C2H4 S: ,097 Weight Yield : 60,86 %

Raw Material: 846 966 MTA @ 300 USD (400) 508 USD (677)

Investment 500 MM USD @20% 200 USD Operation 20 USD Overhead & Maintenance @ 5% of Invest 50 USD

Sum production Cost 778 USD (947)

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Fig. 9: Summary of Ethylene production costs via Ethanol dehydration

Methanol-based Ethylene production via MTO is one of the routes which creates a lot of interest. A process is offered by UOP / Hydro based on a special zeolithe catalyst. The process flow diagram is shown in Fig. 10.

Linde Engineering UOP /Hydro MTO process

Quench Caustic C2 C3 Reactor Regenerator Tower Wash De-C2 De-C1 Splitter De-C3 Splitter De-C4 Tail Gas

Regen Gas Ethylene Propylene Dryer Mixed C4

DME Recovery C2H2 Reactor

C5+ Air Water Propane

Ethane Methanol

Source : UOP Linde AG Geschäftsbereich Linde Engineering 11 Zimmermann / DGMK 2007t

Fig. 10: UOP / Hydro MTO process

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The economics for Ethylene production via MTO are shown in detail in Fig. 11.

Linde Engineering MTO Economics for Ethylene

750 000 MTA Ethylene 750 000 Propylene Per ton Ethylene

Raw Material 3 428 571 MeOH @ 200 USD (250) 1306 (1632) Byproduct Credit - 1040

Net Raw Material 266 (592) Investment 2 500 MM USD @20 % 666

Operation 13 Maintenance & Overhead @ 5 % of Invest 166

Production Cost 1112(1439)

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Fig. 11: MTO economics for Ethylene production

A comparison of production economics for all Ethylene routes is shown in Fig. 12.

Linde Engineering Ethylene Production Cost Comparison

USD / ton Ethylene

1200

1000

800

600

400

200

0 Ethan E/P 50/50 Butan E/B 50/50 Naphta EtOH MTO

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Fig. 12: Production Costs for Ethylene for different routes

Fig. 12 shows that the alternative routes to Ethylene cannot compete with steamcracking today, but e.g. Ethanol dehydration can be attractive if low cost Ethanol is made available. Today's Ethanol production based on sugar cane is most efficient. However, once new methods of biomass fermentation are developed, this route can be very attractive for Ethylene production. Of course, Ethanol is also used as a gasoline component and this application will be competing with the use as olefin feedstock. MTO economics is suffering from the high investment costs for this process and does not look competitive today.

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4. Propylene Production Routes

Propylene production is dominated by steamcracking producing about 70 % of the Propyl- ene. New Propylene routes have been developed, as steamcracking produces Propylene in a given ratio to Ethylene, but the Propylene growth rates are higher than Ethylene. In addi- tion, the new Ethane based crackers do not produce Propylene as direct product. As a consequence a shortage of Propylene is expected, fueling the development of alternative processes.

Naphta cracking is one of the main sources for Propylene today and will be used as refer- ence for evaluation of other new routes.

Fig. 13 shows the economics of Propylene production in a Naphta cracker.

Linde Engineering Naphtacracker : Propylene Production Cost

USD / ton Propylene Naphta: 500 USD /ton 3 008 016 tons 2748 547 228 Propylene

ByProduct Credits Ethylene 1 MM MTA 2010 Pygas 807 000 MTA 959 PFO 71 000 MTA 13 Net Raw Material -234

Investment Depreciated at 20 % 632 Operation 18 Overhead & Maintenance 158

Sum Production Costs 574

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Fig. 13: Propylene Production Costs via Naphta Cracking

Propane dehydrogenation is one of the "on purpose production routes" for Propylene, known for more than 30 years, but suffering in several areas from a cyclical price for Propane which increases significantly during the winter due to pressure from the heating fuel market.

Fig. 14 shows the economics of the dehydrogenation of Propane based on market price for Propane.

Fig. 15 gives the production cost for Propylene based on MTO process.

An alternative, utilized industrially today, is the Metathesis of Ethylene and Butene-2 to form Propylene. Sources for Butene-2 can be C4 cuts from crackers (Raffinate-2) or Ethylene dimerisation. The principle is shown in Fig. 16.

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Linde Engineering Propane Dehydrogenation

Cost of Production: USD Per ton of Propylene

Propane : 500 USD per ton 581 Selectivity 0,86

Investment 400 MM USD for 450 000 KTA 177 (20 % Depreciated)

Operation 10

Overhead 5 % of Invest 44

Total 817

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Fig. 14: Economics of Propane Dehydrogenation

Linde Engineering MTO Economics for Propylene

750 000 MTA Ethylene 750 000 MTA Propylene Per ton Propylene

Raw Material 3 428 571 MeOH @ 200 USD (250) 1306 (1632) Byproduct Credit - 1100

Net Raw Material 206 ( 532) Investment 2 500 MM USD @20 % 666

Operation 13 Maintenance & Overhead @ 5 % of Invest 166

Production Cost 1052 (1379)

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Fig. 15: Economics for MTO based Propylene Production

The economics of a Metathesis with Butene-2 from Raffinate are shown in Fig. 17 and with Dimerisation in Fig. 18.

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Linde Engineering Metathesis to Propylene

Ethylene

Cat / 300 C H2C == CH2

2 CH3 -CH ==CH2

CH3- HC == CH- CH3 Propylene

Butene 2

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Fig. 16: Metathesis to Propylene

Linde Engineering Metathesis for 800 000 MTA Propylene / Europe with Raffinate 2 Import

Raw Materials: 33.33 % Ethylene 66,66 % Butene 2 Selectivity 0,9 Per ton C3H6

Ethylene: 296 266 MTA @ 1100 USD 407 USD Butene 2 592 533 MTA @ 600 USD 444 USD

Investment 300 MM USD @20 % 75 USD

Operation 3 USD

Maintenance & Overhead 19 USD

Sum Production Costs 948 USD

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Fig. 17: Economics of Metathesis from Raffinates

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Linde Engineering Metathesis for 800 000 MTA Propylene / Middle East with Ethylene Dimerisation

Raw Materials: 33.33 % Ethylene 66,66 % Butene 2 Selectivity 0,9 Per ton C3H6

Ethylene: 296 266 MTA @ 500 USD 185 USD Butene 2 592 533 MTA @ 600 USD 444 USD

Investment 300 MM USD @20 % 75 USD

Operation 3 USD

Maintenance & Overhead 19 USD

Sum Production Costs 726 USD

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Fig. 18: Metathesis with Ethylene dimerisation

A comparison of the economics for the different approaches to Propylene is shown in Fig. 19.

Linde Engineering Production Costs for Propylene

1200

1000

800

Naphta 600 Cracking

400

200

0 PDH MTO MTP Metathesis- ME Metathesis Europe

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Fig. 19: Summary of Propylene production costs

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4. Summary

Summarizing the evaluation of various petrochemical production routes to Ethylene and Propylene, one can state that Steamcracking is still an attractive route and will continue to dominate the production in the future. However, production will be shifted to areas with advantaged feedstocks. Naphta cracking in Europe will remain competitive if the feedstock prices remain within the current range, but economic pressure from low cost regions will increase.

At present MTO cannot be seen as competitive on a global basis. There might be locations where economics are better, e.g. MTO based on coal in China.

Bioethanol could be an alternative especially if new fermentation processes are developed. However, competition is fierce for ethanol as a gasoline additive, which creates very high ethanol market prices.

For Propylene production only Propane dehydrogenation with discounted feedstock costs can compete with Steamcracker economics.

Metathesis based on low cost Ethylene dimerisation is quite attractive, whereas Metathesis based on Raffinate 2 is similar to Propane dehydrogenation.

Under current market conditions MTO and MTP are not competitive for Propylene production.

There are several challenges to the traditional production schemes for light olefins, but Steamcracking will remain the main source for these products, with some alternatives being attractive in certain situations.

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