Petcoke in Cement Industry

Srinivasan Raman

Essar Oil Limited

2

Essar Group – A Global Diversified Conglomerate

75,000 people

25 countries worldwide

$ 27.3 Billion revenue

(FY12)

Presence inOil & GasPowerSteelPorts

ProjectsShippingBPOTelecom services

Scale & Diversity

Essar at a Glance

International Footprint

Essar Oil & Gas – Overview

Petcoke

Government administered prices for coal and natural gas are lower than market prices

Petcoke Advantage

Strengths Weaknesses

Sulphur

Metals

Hardness

Cheap

High GCV

• High carbon → higher calorific value• High fixed carbon → higher combustion time• Lower volatile matter → difficult to ignite• Lower ash → less waste disposal• High sulphur → increased corrosion &

pollution

Petcoke

• Very low carbon → very low calorific value• Very low fixed carbon → lower combustion

time• High volatile matter → easier to ignite• Very high ash → heat loss, disposal problem• Low sulphur → lower corrosion & pollution

Dom. coal

Challenges

Petcoke in Global Cement Industry

World Europe

• Petcoke is the preferred fuel of choice for the Global cement industry after coal and lignite• Petcoke is by far the preferred fuel of choice for European cement industry• Cement industry is the largest consumer of petcoke in India (3.7 million tons per annum)• Technology to use petcoke in cement plants is mature and easily available

Petcoke in Global Cement

Challenges & Solutions

Issue Description Modification Required

HGI Petcoke is harder than coal and is more difficult to grind. Finer grinding is required to increase surface area, as volatile matter is lower.

Depends on the existing coal grinding mill. If the coal mill can grind petcoke with minor

modifications, then the cost will be lower. Otherwise a new Vertical Roller mill will be required.

Volatile Matter Petcoke has lower volatile matter and hence more difficult to burn.

Finer grinding improves burning. Increasing the flame momentum helps to improve

burning. This is achieved by installing a Higher capacity blower in place of the primary air fan.

Fixed Carbon Petcoke has higher fixed carbon and needs more residence time to burn completely.

Introduce petcoke feed in the precalciner  to facilitate complete combustion

Increasing the height of existing precalciner to allow higher residence time

Ash As petcoke has lower ash, more raw feed will be required per unit of clinker.

Raw mix feed rate has to be changed

Oxygen requirement More oxygen is required for complete combustion

Provision of more secondary air

NOx Higher flame temperature increases NOx emissions

NOx control technologies if NOx levels are higher than regulated levels

Challenges & Solutions

Issue Description Modification Required

Clinker hardness Clinker becomes harder caused by longer burning zone.

Finish mills need more power to grind

Refractory damage Petcoke burning causes more refractory damage

Selective upgrading of refractory bricks and higher maintenance

Sulphur

Sulphur alkali ratio Due to higher sulphur, the sulphur alkali ratio in the feed is disturbed

Modification of the raw mix so that combinability temperature is reduced.

Sulphur cycle Sulphur volatilizes in the burning zone and condenses in the calcining zone

Bypass line might be required

Coating in riser duct Volatile compounds (formed by alkali with sulphur and chlorides in petcoke) condense and form a thick coating.

Refractory bricks can be replaced with Alumina-Zirconia-Silica or silicon carbide based castable which has low adherence property.

Challenges & Solutions

Modify raw mix to account for higher S & lower ash

Finer grinding of petcokeLarger blower for primary airMore secondary air

More grinding capacity

Refractory upgradeBypass line

Burning petcoke during precalcinationIncreasing precalciner height

Process Modifications

Financial Benefits

OPEX Savings

Base Case Petcoke in Kiln

Petcoke in Kiln & CPP

Total Energy Cost ($ K)

13,316 12,248 11,828

Saving % - 8% 11%

• Cement production is energy intensive• Energy cost is around 20% of sales• Any saving in energy cost boosts profits tremendously

Profit Improvement

% Revenue Basis

$ / MT Basis

Sensitivity Analysis

EBITDA compared to Base Case: $ 1.33 /MT Cement

Sensitivity Analysis

PAT compared to Base Case: $ 0.9 /MT Cement

Petcoke in India

Product• Relatively new in India• Mostly fuel grade

Supply• < 0.5 MMTPA to > 10 MMTPA in the

last decade• Addition of coker units to boost supply

Demand• < 0.5 MMTPA to > 10 MMTPA in the

last decade• Coal shortage boosting demand• Cement sector is the major user

Prices• Generally set relative to imported coal

prices

Supply & Demand

Regional Data

• New cokers to produce fuel grade petcoke

• Surplus in West to increase

• Fuel grade petcoke will be produced in East and South too by 2015

Refinery Coker Date

Paradip Q3 FY 2014

Mangalore Q1 FY 2014

Manali Q4 FY 2015

Production

Production• 1.8 million tons per annum petcoke production capacity

Storage• 2 silos with capacity of 1000 tons each• Open storage yard • Storage near rail siding

Logistics• 24 × 7 road loading• Integrated rake loading• Coastal loading facilities from Bedi port

Quality• Stringent quality control at all stages• State of the art quality control lab

Customer Service• Dedicated sales team for customer delight• Customized solution for converting from other fuels• Support in troubleshooting

Facilities

S.No Parameter Unit Limits

1 Moisture (ARB) % wt 8.0 max

2 Ash % wt 0.5 max

3 Volatile Matter % wt 8.0 min

4 Fixed Carbon % wt 85 min

5 Gross Calorific Value (ADB) Kcal/Kg 8,200 min

6 Sulphur % wt 4-7

7 HGI - 36 - 52

Specifications

Cost• Cheaper than many fuels on a calorific basis• Capture of entire calorific value of fuel leading to higher efficiency

Availability• Increasing supply• Reliable supplies from various refineries

Calorific Value• High net calorific value

Ash• Lower ash with no disposal problems• Lower abrasion

Handling• Lower quantity of fuel to be handled• Lower area required for storage• Non hygroscopic - doesn't absorb moisture• Lower handling and transportation losses

Benefits

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