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ERTCSHOW DAILY DAY 1 15 / 16 November 2004

2004/9th Annual Meeting INSIDE TODAY . . .Welcome to Prague and the ERTC 9th Annual Meeting . . . . .3Partners Programme . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Technical Program. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Opportunity for EOM in downstream petroleum . . . . . . . . . . . 4

ENI refinery uses state-of-the-art SO2scrubbing on FCCU . . .6

REACH and refineries: what are the options? . . . . . . . . . . . . . 7

Technologies in brief. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 19

Hospitality Suites . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

ALSO INCLUDING . . .

Articles featuring the latest technologies, case histories,environmental issues, and much more . . .

Providing solutions for tomorrowsneedstodayis the key to buildinga growing, sustainable business. Thisrequires a mixture of foresight andstrategic risk taking and the invest-ment in research well before needsbecome reality. A major objective inAxens strategy for enabling growthis to ensure that we have the technol-ogies and associated products andservices that will provide the rightmotor fuel components for the mar-ket. Furthermore, it is our objective to

provide thosetechnologicalanswers in atimely manner.Time-to-marketis as importanta concept aswhat and whereto market.

The worldrecently expe-rienced a seriesof geopolitical

perturbations that began with theAsian financial crisis in 1997, fol-lowed by a series of events whoseimpacts have yet to be attenuated.However, during this time, three ele-ments of our business strategy didnot change and continue to serve asstrategic anchors:Ever cleaner-burning fuels will

be requiredCrude oil demand will increase

at least 1.5% per year over anextended periodWell-to-wheels greenhouse gas

emissions will be legislated.The oil refining business has not

always been exemplary in show-ing steady growth and profits, butthe competition among providersis tough. The objective is to ensurepositive growth over the mid to longterms, and to accept the uneven prog-ress on an annual basis. Thus, sus-tained growth requires an ambitious,long-term vision that remains constantand a product strategy that aligns

with the strategic business anchors.In response, we have directed ourattention to: cleaner fuels, improvedoil conversion and alternative fuels.

Cleaner fuels.Axens engaged in asustained clean fuels program bothin process and catalyst manufac-turing technology. This long-terminvestment produced the right prod-ucts at the right time. These cleanfuels products are highly visible inthe market:Prime-G+1

HR 500 series with ACE technol-ogyPrime-D & EquiFlow internals.The HR 500 series catalysts

launched at the ERTC in London justlast year have surpassed our plan-ning expectations. These long-termefforts have paid off in the distillatehydrotreating area and are nowbecoming apparent in the conversionarea due to the high price of crude.

Improved oil conversion.Oil priceshave shown significant periods ofinstability since the 1970s. Theincreased dependence of economicdevelopment on crude oil, and thesomewhat unstable geographicalregion that is its major provider,have had both real and psychologi-cal effects on oil prices. The latterhave been exacerbated by specula-tion that peak oil is near. (This isdefined as the time at which one-halfof the worlds oil supply has beenexhausted.) In any case, recenttrends imply that the age of inex-

pensive, less than $20 per barrel oilis over (Fig. 1).

Light, sweet crudes are the firstto be used because upgrading isless costly. When oil supply is tight,the price differential between lightand heavy, sweet and sour, crudesincreases. This makes it economi-cally attractive to use these heavy,sour feedstocks. To do this, VGO andresidue conversion processes arerequired, such as: FCC, coking andhydrocracking.

We invest a major portion of ourR&D spending toward the develop-ment of robust, cost-effective tech-

nologies for VGO,residue and heavy oilconversion as shownin Table 1 for hydro-conversion processes.Among the techno-logical improvementsrecently commercial-ized or developed, hereare two examples.

RS2 FCC riser sepa-

ration system.Fluidizedcatalytic crackers are theheart of most refineryconversion schemes.These gasoline produc-ing units have evolvedover the years to treat

increasingly heavy feeds and to pro-duce larger quantities of propylene forpetrochemical usage. The FCC unit ispacked with technology that makesthe catalyst flow correctly, mix the feedperfectly and quickly, and disengagethe catalyst rapidly and cleanly fromthe product stream.

This year, the new RS2 riserseparation system was commer-cialized and is destined to success.It ensures a near instantaneousseparation of the hot effluent fromthe catalyst at the top of the reac-tor riser, thereby limiting over-cracking which causes excessive

coking and dry gas make. In maxi-gasoline operation in its debut in aEuropean refinery, the RS2enableda gain of 1.3% in capacity, a 2.6%

gain in gasoline yield, a 23% reduc-tion in dry gas make and a gain of4.7% propylene make. RS2is welladapted to revamping projects inany FCC that is looking for theseparticular advantages (Fig. 2).

Heavy-oil (H-Oil) upgrading.Newheavy oil complexes are infrequentand represent significant investments.Heavy oil feedstocks have some char-acteristics that make processing dif-ficult, such as: high metals, sulfur,

www.HydrocarbonProcessing.com

Strategic business anchors in the refining industryJean Sentenac,President and CEO, Axens, Rueil-Malmaison, France

Axenscontinued on page 16

15/16 November 2004 ERTC Annual Meeting 1

FIG. 1.Evolution of crude oil prices, on an averaged annual basis, incurrent and constant (2003) dollars, from the BP StatisticalReview.

Jean Sentenac

1ACE, EquiFlow, Esterfip, Gasel, H-Oil,

Hyvahl, Prime-D and Prime-G+ are

trademarks of Axens.

TABLE 1.Hydro-conversion processes for normaland difficult VGOs and residues

Hydroconversion

process type Process* Feed, conversion level (%) and descriptionFeed Hyvahl-PRS ARDS/VRDS (< 45%) FCC feed improvement with HDM

preparation

H-Oil-HCC Heavy crude conversion for syncrude production via viscosity reduction

Mild HyC-LC VGO (60%), superior product, high cetane

Hytail Heavy diesel / light VGO (>60%), end point improvement (FBP, S, cetane) forhard-to-treat diesel tail fractions

H-Oil-RC Heavy oil, residue conversion process (>60%) for difficult feeds (with IS2/C2U)

*The following are service marks of Axens: PRS, permutable reactor system; IS2, inter-stage separator, C2U, cascade catalyst utilization.

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nitrogen and asphaltene contents,solid matter (sand, for example) in thefeedstock. Ebullated-bed technology isideal for the treatment of these resid-ual crudes because it enables constantperformance and it is immune to reac-tor plugging.

Axens and IFP have invested in

reducing both the capital and operat-

ing costs per barrel of feed processed

and in widening the application of theH-Oil technology. In 2004, three specific

advanced generation H-Oil processes

are marketed:

H-Oil-HCC.This heavy crude con-

version process produces syncrude.

The objective of the unit is to enable

just enough conversion to reduce vis-

cosity and increase stability so that the

product can be readily transported to

an upgrading center.

H-Oil-DC.Difficult to treat VGOs

and VGO mixtures are processed in this

unit with the objective of moderate con-

version. Previously known as the T-Star

process, this unit is a lighter version of

the residue conversion process.

H-Oil-RC.The classical H-Oil pro-

cess has been significantly upgraded

to increase conversion levels, increase

product stability and reduce costs.

Among the improvements made to

the traditional technology are the

integration of IS2(inter-stage separa-

tor) between reactors in series and the

application of C2U (cascade catalyst

utilization).

Alternative Fuels.A small but grow-ing portion of nonconventional fuels

are entering the transportation fuels

pool as blending components or as

pure products. There are several rea-

sons for this trend, such as: decrease

well-to-wheels CO2emissions, decrease

importation of crude oil, diversify sup-

ply to include natural gas derived fuels,

subsidize farmers through a de-taxation

of fuel-grade products, and decreaseunemployment in rural communities.

Among the fuels cited, there are gener-

ally three classes:

Gaseous fuels (at atmospheric

pressure): hydrogen, CNG, LPG, DME

Liquid biofuels: ethanol, fatty acid

methyl esters (FAME)

Liquids from natural gas: Fischer-

Tropsch derived diesel.

We strongly believe that liquid hydro-

carbons will remain the overwhelming

contributors to transportation fuels in

the future, for distribution and supply

reasons, and that pressurized fuels

will find their outlet in the non-mobile

energy sector. Thus, this limited our

selection. In addition, Axens special-

izes in mineral-based catalytic technolo-

gies; this reduced the attractiveness of

ethanol routes based on fermentation.

Finally, more than a decade ago, this

reasoning led to the selection of two

long-term targets: high cetane blending

components through Fischer-Tropsch

catalysis and fatty acid esters from cata-

lytic esterification.

Gasel gas-to-diesel.The conver-

sion of natural gas to synthesis gas then

liquids is well known to produce a diesel

fuel of superior quality: sulfur, nitrogen

and aromatics-free, cetane above 70.

A product of this quality is well suited

as a diesel additive. Several years ago,

IFP and ENI combined their efforts on

the transformation of synthesis gas to

diesel fuels. The joint development led

to the construction of a pilot in Sannaz-

zaro, Italy, that has been operated on asemi-continuous basis for two years.

At this stage, we have verified that all

the technology in each of the steps has

attained full commercial-level develop-

ment. Current efforts are concentrated

in scaling up production of commercial

catalysts that will be used in the Gasel

technology. Axens is the exclusive licen-

sor of this gas-to-liquids technology.

Esterfip-Hsecond-generation

biodiesel technology.Biodiesel is com-

posed of fatty acid methyl esters (FAME)

resulting from the esterification of vari-

ous plant oils such as rapeseed, soy-

bean or sunflower oil. When integrating

the full life cycle of CO2emissions of

biofuels, it is clear that FAME could be a

key component in reducing emissions

from transportation fuels.

Axens recently licensed Esterfip-H,

a first-of-a-kind technology based on

heterogeneous catalysis. This unit is

expected to be commissioned in the

fourth quarter of 2005. In view of the

European demand for diesel and the

target of 5.75% biofuels in the 2010

timeframe, this process is expected to

show significant short-term success.

Esterfip-H represents a major

advancement in the area of biofuels, as

it ensures the production of biodiesel

meeting European specifications, and

at the same time directly produces

glycerin of unequalled purity. The glyc-

erin byproduct is a determining factor

in the overall production economics.

In addition, this solid catalyst process

enables a significant reduction in waste

streams compared to other processes.

Already in 1992, Axens original process

licensing branch within IFP, licensed the

Esterfip process based on homoge-

neous catalysis. The key feedstock for

this process is shown in Fig. 3.

VISION

Sustainable growth in the competi-

tive refining service sector is a chal-lenge. Research is technologically

intensive and the market is conserva-

tive. Thus, progressing from research

to commercial success requires

time sometimes years, sometimes

more than a decade to bear fruit.

Ideas need to be investigated and

developed; preliminary findings require

pre-commercial testing; technology

scaling-up must be carefully designed;

and, finally, a first field operation is

required before a return on the initial

investment can begin.

Although it may be cloudy, it is

important to project the vision by a

decade. Todays sales and marketing

are based on foresight and strategic risk

taking from a decade ago, on a research

project started based on an imperfect

vision.

Jean Sentenac is President and Chief ExecutiveOfficer of Axens. He began his career at Air Liquide

as business manager for Spain and Italy beforejoining the Rhne-Poulenc Group. There, he direct-ed business units in organic chemicals, and wasnamed CEO of Rhodia Diphenols & Aromas in

1995, and then Rhodia Life Science Chemicals in1998. He joined IFP in 2000 as Deputy ExecutiveOfficer responsible for IFPs Industrial Division,

and was named Axens Deputy CEO in June2001 with responsibility over the Tech Service,Marketing and Technology Departments as well as

the Performance Programs Business Unit, before

being selected to his current position in 2002.Mr.Sentenac, is an engineering graduate of FrancesEcole Polytechnique, and holds a post-graduateengineering degree from the IFP School.

Axens,continued from page 1

FIG. 3.The ideal raw material for biodieselrapeseed.

FIG. 2.RS2device prior to installation in aEuropean refinery.

www.HydrocarbonProcessing.com

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