Oil is used to power our vehicles, to create medicines that keep us healthy, and to make the plastics, cosmetics, and other personal products that enhance our daily lives. Prior to joining ihs markit in 2010, glenn worked for atlantic richfield co. Economics of heavy oil production processes refining margins refinery operating costs refinery profit margins conversion unit processing costs relative value of crude oil versus products refining process capital costs who should attend. Changes in expectations of economic growth in can affect oil prices. In the second stage, supply and demand fundamentals stabilize resulting in a compression of refining margins. This feedstock competition is the most important mechanism that links base oil refining economics to fuels refining economics, tying base oil prices to crude oil and refined products.
Configuration changes in 2000, 2004, and 2007 to reflect product. This two day course will offer participants a brief introduction to petroleum refining economics. Environmental and economic impacts of crude oil and. Seeking 90% may have caused a 40% increase in capital cost at nwu. The capacity for refining crude oil over a given period of time, usually expressed in barrels.
Refinery crude oil distillation process complete full hd crude oil distillation process complete. Pdf petroleum refining technology and economics fourth. Major refining technologies are described such as crude oil distillation, heavy oil conversion options, hydrotreating, and catalytic reforming. What it really measures is whether the refinery will make money at the margin i. More than a dozen other petroleum products are also produced in. In the oil refining business, the cost of inputs crude oil and the price of outputs refined products are both highly volatile, influenced by global, regional, and local supply and demand changes. The gross refining margin grm is the difference between the total value of petroleum products coming out of an oil refinery output and the price of the raw material, input which is crude oil. Prism industry modeling and database services baker. Crude oil can range from light, volatile oils that are highly fluid to highly viscous oils.
Crude oil refinery flow diagram showing process chemical additives financial benefits whether it be extending equipment life due to corrosion inhibition, increasing production output due to enhanced deposit control, or shortening the the startup time during. Petroleum refining processes and economics for non technical. Indeed, many petrochemicals are produced as side streams during crude oil refining, which primary goal remains transportation fuel production. The most common method of refining crude is the process of fractional distillation. Mooc introduction to crude oil refining part 1 english duration. As a result, the overall differential of us domestic crude to brent narrowed. Second, the price of crude oil is the most significant factor determining the prices of petroleum products. Most refineries focus on producing transportation fuels. Refining process services was founded in 1985 to meet the need for an independent source of refining. Get free petroleum refining technology and economics. The office of petroleum, natural gas, and biofuels analysis pngba of the eia has been tasked to develop a dynamic representation referred to here as global hydrocarbon supply model, ghysmo of the global production, processing, transportation, distribution, and storage of natural gas and liquid fuels. April 7, 2020 washington, dc an analysis of 7 factors that influence oil markets, with chart data updated monthly and quarterly.
Global hydrocarbon supply model petroleum refining component. Petroleum refining processes and economics for non. The economic impact of crude oil transportation in the great lakes 4 1. Fundamentals of petroleum refining presents the fundamentals of thermodynamics and kinetics, and it explains the scientific background essential for understanding refinery operations. However, none of these products would exist without the. They are shipped from many sources to many markets see figure 3. The primary focus will be on how markets, technology, finance and regulations impact the refining business profitability. On the other hand, natural gas is composed primarily of methane 85 95% but may also contain ethane, propane and heavier hydrocarbons. Refining adds value by converting crude oil which in itself has little enduse value into a range of refined products, including transportation fuels. Petroleum refining processes are the chemical engineering processes and other facilities used in petroleum refineries also referred to as oil refineries to transform crude oil into useful products such as liquefied petroleum gas lpg, gasoline or petrol, kerosene, jet fuel, diesel oil and fuel oils. Economics of process analysis for efficient utilization of crude oils maximization of the refining margin forms the platform of todays refinery economics. Evaluating the economic performance of the petroleum refining industry is complicated by the. Crude oil prices displayed in trading economics are based on overthecounter otc and contract for difference cfd financial instruments. Mooc introduction to crude oil refining part 4 youtube.
This course will present an overview of modern, sophisticated petroleum refining. The relationship between oil price and costs in the oil and gas industry. The abundance of heavier crude oil has led to the evolution of flexible refining operations capable of producing more valuable finished products from a variety of feedstocks. Crude oil refinery flow diagram showing process chemical. Virtually all transportation, land, sea, and air, is fueled by products that are refined from crude oil. The presentation then moves into the refinery to explore the effects of crude oil type on refining yields and to examine the interactions between crude oil selection and refinery. Petroleum refining 101 course january 2020 in denver euci. Petroleum refining 101 january 2728, 2020 denver, co. In reality, existing refineries must consider their refining costs in addition to just the cost of crude oil.
Trading economics does not verify any data and disclaims any obligation to do so. Global hydrocarbon supply model petroleum refining. Most crude oil is dark brown or black but it could also occur in green, red or yellow colour. Pdf refinery configuration studies on heavy crude oils.
The future of oil refining profit margins by brad vantassel in recent years, oil refining margins have been extremely volatile. Petroleum refining technology and economics fourth edition. Refinery configuration studies on heavy crude oils. Petrochemicals feed stock like ethylene and propylene can also be produced directly by cracking crude oil without the need. Petroleum refining technology and economics fifth edition pdf. For crude oil to be used effectively by modern industry, it has to be separated into its component parts and have impurities like sulfur removed. Introduction and objectives since 2007, the production of crude oil henceforth oil in both canada and the united states of america has experienced a steady increase, despite macroeconomic shocks e. Pdf crude oil affects almost all activities of our modern day hydrocarbon society irrespective of the shifting trend to green energy. Unknowns about the future growth rate of the world economy, the price of crude oil, government regulations, as well as the economics of alternative transportation fuels are causing many uncertainties for the industry. This video describe the complete distillation process in a refinery. Refining, which represents the conversion of crude oil into petroleum products. Purpose of work the main purpose of this limited study was to conduct a literature search on cold cracking of petroleum crude oil in an attempt to collect and analyze background information. History, process and products nearly every aspect of our modern lifestyle is impacted by oil. Oil refining and products request pdf researchgate.
Economics of process analysis for efficient utilization of. Whitepaper on crude blending reasons for blending crude oils at a refinery oil refineries, and especially their onprocess units that process the primary crude feed stocks, are not uniform in either design or operation. The modern petroleum refinery has a series of core process units that create clean gasoline and low sulfur diesel fuel. The economic impact of crude oil transportation in the. Refineries must find the sweet spot against a backdrop of changing environmental regula. Crude oil is a critical source for economic growth and. This is followed with a description of refinery process technology. The text also provides a detailed introduction to refinery engineering topics, ranging from the basic principles and unit operations to overall refinery economics. Our market prices are intended to provide you with a reference only, rather than as a basis for making trading decisions. The primary objective of the petroleum refining component submodule is to provide a reasonable representation of the world refining industry. Step 1 in the refining process is to remove these contaminants so as to reduce corrosion, plugging, and fouling of equipment and to prevent poisoning catalysts in processing units. Crude oil distillation is more complicated than product distillation, in part because crude oils contain water, salts, and suspended solids.
The economic impact of crude oil transportation in the great. Primary crude oil cuts in a typical refinery include gases, lightheavy naphtha, kerosene, light. The first part of the program includes an overview of crude oil supply and petroleum product demand. The relationship between oil price and costs in the oil. This program has been designed for nontechnical professionals assigned to. With lower crude prices, there is a general compression of most refining products spreads and differentials. From crude oil how oil refining works howstuffworks.
Actual production of crude oil products, such as gasoline and heating oil. Energy news covering oil, petroleum, natural gas and investment advice. The refinery process units and the combination of units built and. An oil refinery or petroleum refinery is an industrial process plant where crude oil is transformed and refined into more useful products such as petroleum naphtha, gasoline, diesel fuel, asphalt base, heating oil, kerosene, liquefied petroleum gas, jet fuel and fuel oils. The first oil refinery unit is crude oil desalting. The oil refining industry in china has faced rapid growth in oil imports of increasingly sour grades of crude with which to satisfy growing domestic demand for a slate of lighter and cleaner. Refining in nigeria nigeria is the second largest producer of oil in africa, producing over 1. Refining process services was founded in 1985 to meet the need for an independent source of refining technical consulting and training services. Availability of some critical feedstocks may then depend on local refining policy.
It dictates refineries to maximize the production capacity of highly demanded refinery products, while reducing the cost of their crude oil feed. The economics of petroleum refining canadian fuels association. Estimating the economic impacts of any regulation on the petroleum refining. A crude oil program is a table of the refinerys current crude oil inventory with projected imports, feed outlets, and the storage tank reference.
Also, you can read online petroleum refining technology and economics fifth edition full book. Download full petroleum refining technology and economics fifth edition book in pdf, epub, mobi and all ebook format. Understanding the business of processing crude oil into fuels and other value added products. Most spreads reflect the cost of transforming one crude or product into another. The petroleum refining industry provides products that are critical to the functioning of the. Big strike lead french oil refining basicly paralyzed. The overall economics or viability of a refinery depends on the interaction of three key elements. In addition to the competition for feedstocks, the cost structure of base oil plants also ties base oil economics to fuels and refined products. Capacity, cost, investment optimization of refinery operations prof. Refining 1 outline refinery processes refining markets.
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