Challenges and Solutions for Shale Oil Upgrading

Challenges and Solutions for Shale Oil Upgrading Don Ackelson UOP LLC, A Honeywell Company 32 nd Oil Shale Symposium Colorado School of Mines October 15-17, 2012 2012 UOP LLC. All rights reserved. UOP 5910-1

Method of Extraction Can Impact Difficulty of Upgrading Oxygen-free gas flow? Above ground versus In-situ Vertical versus horizontal Rapid versus slow Heating methods Internal combustion Hot recycled solids Wall conduction Externally-generated hot gas Reactive fluid Radio waves, microwaves, etc. UOP 5910-2

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Sulfur Nitrogen Hydrogen Oxygen Arsenic 0.80 Wt-% 1.8 Wt-% 11.55 Wt-% 1.0 Wt-% 40 wppm UOP 5910-4

Sulfur 0.80 Wt-% Sulfur 0.72 Wt-% Nitrogen Hydrogen Oxygen Arsenic 1.8 Wt-% 11.55 Wt-% 1.0 Wt-% 40 wppm Nitrogen Hydrogen Oxygen Arsenic 0.180 Wt-% 9.73 Wt-% 7.2 Wt-% 4 wppm UOP 5910-5

Sulfur 0.80 Wt-% Sulfur 0.72 Wt-% Nitrogen Hydrogen Oxygen Arsenic 1.8 Wt-% 11.55 Wt-% 1.0 Wt-% 40 wppm Nitrogen Hydrogen Oxygen Arsenic 0.180 Wt-% 9.73 Wt-% 7.2 Wt-% 4 wppm Sulfur 0.4-0.7 Wt-% Nitrogen 0.8-1 Wt-% Hydrogen 11.-12.5 Wt-% Oxygen 3-7 Wt-% ---------- ---------- UOP 5910-6

Sulfur 0.80 Wt-% Sulfur 0.72 Wt-% Nitrogen Hydrogen Oxygen Arsenic 1.8 Wt-% 11.55 Wt-% 1.0 Wt-% 40 wppm Nitrogen Hydrogen Oxygen Arsenic 0.180 Wt-% 9.73 Wt-% 7.2 Wt-% 4 wppm Sulfur 0.4-0.7 Wt-% Nitrogen 0.8-1 Wt-% Hydrogen 11.-12.5 Wt-% Oxygen 3-7 Wt-% ---------- ---------- Sulfur Nitrogen Hydrogen Oxygen Arsenic 11.26 Wt-% 0.407 Wt-% 9.73 Wt-% 2.4 Wt-% 29 wppm UOP 5910-7

Sulfur 0.80 Wt-% Sulfur 0.72 Wt-% Nitrogen Hydrogen Oxygen Arsenic 1.8 Wt-% 11.55 Wt-% 1.0 Wt-% 40 wppm Nitrogen Hydrogen Oxygen Arsenic 0.180 Wt-% 9.73 Wt-% 7.2 Wt-% 4 wppm Sulfur Nitrogen Hydrogen Oxygen 0.68 Wt-% 1.06 Wt-% 12.0 Wt-% 2.0 Wt-% Sulfur 0.4-0.7 Wt-% Nitrogen 0.8-1 Wt-% Hydrogen 11.-12.5 Wt-% Oxygen 3-7 Wt-% ---------- ---------- ---------- ---------- Sulfur 11.26 Wt-% Nitrogen 0.407 Wt-% Hydrogen Oxygen Arsenic 9.73 Wt-% 2.4 Wt-% 29 wppm UOP 5910-8

Shale Oils and Upgrading Requirements Vary, but There are Some Common Challenges Upgrading Challenge Potential Problems Particulates Arsenic Oxygen Nitrogen Di-Olefins Plugging Deactivation Gum Formation Instability Plugging UOP 5910-9

UOP/Unocal Pilot Plant Studies Covered All Aspects of Extraction and Upgrading Full slate of pilot plants 3 ton per day retort De-ashing and de-arseniting Coking, fractionation Hydrotreating and hydrocracking UOP 5910-10

Broad Range of Shale Sources and Processing Goals Was Studied Processed many different shale oils from Variety of retorting processes Variety of locations Including Colorado, Utah, Bulgaria, Russia, Australia, Morocco, Israel and others Pilot plant objectives Arsenic removal Naphtha, Jet, Diesel yields and quality Catalyst optimization Cold flow improvement Capability for high nitrogen & ammonia environment UOP 5910-11

Parachute Creek, Colorado, USA UOP 5910-12

Retort Located on Bench Next to Mine Entrance UOP 5910-13

Upgrader Located Several Miles from Retort UOP 5910-14

Unocal Produced and Upgraded Colorado Shale Oil from 1986-1990 Facility built at Parachute Creek in lower Piceance Basin in Colorado Design throughput was 12,800 tpd shale rock Produced 10,000 bpd raw shale oil Key challenges identified & solved Produced 4,500,000 barrels of SCO 1986 to 1989 synthetic crude processed as blend stock with normal crude slate in Unocal refinery in Illinois 1989 to 1990 synthetic crude sold to Gary Western States & Crysen (USA) which processed it to transportation fuels (diesel, light blends) Operations halted due to economic reasons (Oil price <$20/barrel) Catalyst over entire operating cycle Showed little deactivation Did not require regenerating UOP 5910-15

Parachute Creek Produced SCO Superior to Arabian Light Crude SCO from Shale Oil Arabian Light Crude Gravity, API 40 34 Sulfur, wppm 5 17,000 Nitrogen, wppm 60 800 Heavy Metals, wppm (V + Ni + Fe) Nil 20 Distillation, Vol% < 1000 F 100 85 > 1000 F Nil 15 UOP 5910-16

Boiling Range Distribution Was Favorable 2.1 31.1 22.3 44.5 C4's Diesel (350-650 C) Gasoline (C5-350 F) VGO (650 F+) UOP 5910-17

Effective Solutions for Key Problems Have Been Found Particulates in shale oil Dependence on mining, crushing, extraction, tankage Range of sizes; some sub-micron Organic & inorganic Significant effort involved in successful removal UOP s approach can include mechanical filtration, de-ashing, guard beds Arsenic Powerful poison for hydroprocessing catalysts Catalyst developed for high As Colorado shale oil Reactor outlet As content consistently below 0.5 wppm Total capacity expected to be 40-50% of fresh catalyst weight UOP 5910-18

Effective Solutions for Key Problems Have Been Found Cold Flow Upgraded shale oils with paraffinic character can require dewaxing Dewaxing catalyst developed to work in high N and NH 3 Parachute Creek full range shale oil pour point reduced from +80 o F to +10 o F Fuel yields & qualities also improved through dewaxing Fuel Specifications Shale oil properties can be challenging Jet smoke point and diesel cetane require significant saturation for many shale oils Oxidation and sediment stability of fuels requires careful attention to hetero compound concentrations UOP 5910-19

Effective Solutions for Key Problems Have Been Found Olefins & dienes in feed Potential plugging with most shale oils Recent pilot plant work demonstrated value of protective beds 500 Reactor Pressure Drop, psig 400 300 200 Shutdown 100 0 0 2 4 6 8 10 Days on Stream UOP 5910-20

Effective Solutions for Key Problems Have Been Found Olefins & dienes in feed Potential plugging with most shale oils Recent pilot plant work demonstrated value of protective beds 500 Reactor Pressure Drop, psig 400 300 200 100 0 0 10 20 30 Days on Stream UOP 5910-21

Shale Oil Upgrading Steps Shale Oil Pretreatment High Pressure Hydrotreating Hydrocracking and / or Dewaxing Particulates Arsenic Other Metals Olefins Nitrogen Sulfur Oxygen Paraffins Nitrogen Sulfur Oxygen Paraffins VGO, Resid Spec S, N, Paraffins VGO, Resid Premium Synthetic Crude Finished Products Catalysts & Guard Beds Based on Proven Commercial Solutions Newest Generation HT Catalysts from UOP/Albemarle UOP Unicracking TM Technology Dewaxing from UOP/ExxonMobil UOP 5910-22

Molecular Evolution in the Hydrotreating Reactor Sulfur Nitrogen Aromatics S-S NH 2 SH R2 R1 S S N N NH R1 R1 R2 NH 3 H 2 S N R1 R1 R2 R2 NH 3 H 2 S S S R1 R2 R2 S NH R1 R1 NH 3 H 2 S UOP 5910-23

Viru Keemia Grupp (VKG) Pilot Plant Demonstration UOP 5910-24

We Evaluated Three Configuration Options: Case 1 20.2 Volume Percent FF Raw Shale Oil Feed De-Arseniting Pretreating Unit UOP VGO Unionfining TM Unit 61.5 Volume Percent FF 27.0 Volume Percent FF Total Naphtha 20.2 Volume Pct. Total Diesel 61.5 Volume Pct. Total Fuel Oil 27.0 Volume Pct. Total C 4 + Product 110.0 Volume Pct. UOP 5910-25

Parallel Hydrotreating Option Case 2 Fractionating Column 18.4 Volume Percent FF Raw Shale Oil Feed De-Arseniting Pretreating Unit Integrated Distillate/VGO Unionfining Unit 53.5 Volume Percent FF 33.4 Volume Percent FF Total Naphtha 18.4 Volume Pct. Total Diesel 53.5 Volume Pct. Total Fuel Oil 33.4 Volume Pct. Total C 4 + Product 106.2 Volume Pct. UOP 5910-26

Hydrocracking to Obtain Maximum Diesel Yield Case 3 28.9 Volume Percent FF Raw Shale Oil Feed De-Arseniting Pretreating Unit Unicracking Unit 82.5 Volume Percent FF 1.2 Volume Percent FF Total Naphtha Total Diesel Total Fuel Oil Total C 4 + Product 28.9 Volume Pct. 82.5 Volume Pct. 1.2 Volume Pct. 114.7 Volume Pct. UOP 5910-27

Case Comparison Case 1 Case 2 Case 3 Naphtha, BPSD 20.2 Vol % 18.4 Vol % 28.9 Vol % Diesel, BPSD 61.5 Vol % 53.5 Vol % 82.5 Vol % Fuel Oil, BPSD 27.0 Vol % 33.4 Vol % 1.2 Vol % Hydrogen Consumption, Wt-% Base Base x 0.56 Base x 1.12 CAPEX, MM US$ Base Base x 0.90 Base x 1.09 UOP 5910-28

Selected For Final Evaluation Integrated Distillate/VGO Unionfining Unit Case 2 Reactors HT H H P S CHPS 370 C + Feed H 2 370 C - Feed HT H F D To Fuel Oil Stripper H H P S H F D To Product Fractionator UOP 5910-29

Configuration and Conditions Were Optimized in the Pilot Plant Good example of optimization Evaluate configuration options Test selected configuration to demonstrate Removal of contaminants Maximum production of most valued products Euro V diesel Low sulfur fuel oil Unique Feed Characteristics High tail-end boiling points Moderate sulfur & nitrogen contents High contents of unsaturates Very high concentration of oxygen 60 50 40 30 20 10 0 Feedstock Properties Property Value Density @ 15.6 o C 0.987 Sulfur, Wt % 0.722 Nitrogen, wppm 1796 Hydrogen, Wt % 9.73 Oxygen, Wt-% 7.2 Arsenic, wppm 4 Final Boiling Pt., o C 728 Diesel Cetane Number Feed Product UOP 5910-30

Configuration and Conditions Were Optimized in the Pilot Plant Feedstock Properties Good example of optimization Evaluate configuration options Test selected configuration to demonstrate Removal of contaminants Maximize production of most valued products Euro V diesel Low sulfur fuel oil Unique Feed Characteristics High tail-end boiling points Moderate sulfur & nitrogen contents High contents of unsaturates Very high concentration of oxygen Property Value Density @ 15.6 o C 0.987 Sulfur, Wt-% 0.722 Nitrogen, wppm 1796 Hydrogen, Wt-% 9.73 Oxygen, Wt-% 7.2 Arsenic, wppm 4 Final Boiling Pt., o C 728 wppm 8000 6000 4000 2000 Diesel Sulfur Feed Product 0 UOP 5910-31

Configuration and Conditions Were Optimized in the Pilot Plant Feedstock Properties Good example of optimization Evaluate configuration options Test selected configuration to demonstrate Removal of contaminants Maximize production of most valued products Euro V diesel Low sulfur fuel oil Unique Feed Characteristics High tail-end boiling points Moderate sulfur & nitrogen contents High contents of unsaturates Very high concentration of oxygen Property Value Density @ 15.6 o C 0.987 Sulfur, Wt-% 0.722 Nitrogen, wppm 1796 Hydrogen, Wt-% 9.73 Oxygen, Wt-% 7.2 Arsenic, wppm 4 Final Boiling Pt., o C 728 wppm 8000 6000 4000 2000 VGO Sulfur Feed Product 0 UOP 5910-32

Reactor Pressure & Temperature Impacted Product Quality 50 Diesel Cetane Number 49 48 47 46 Reactor ABT = 360 o C Reactor ABT = 370 o C 45 0 5 10 15 20 Reactor Pressure, barg above Base UOP 5910-33

Changing Space Velocity Was More Effective 54 Diesel Cetane Number 53 52 51 50 49 48 0 0.5 1 10 2 2.5 3 LHSV, Relative to Base Value UOP 5910-34

Capability to Produce Specification Products Was Successfully Demonstrated De-arseniting/Pretreating unit very effective at removing contaminant metals from the feed Feed metals (except Fe) reduced to very low levels 5 wppb Arsenic remaining in the product Chlorides in the feed reduced from more than 60 wppm to less than 7 wppm Capability to produce Euro V diesel confirmed Diesel aromatics are reduced to low levels while producing specification diesel Cold flow properties of the specification diesel product meet specifications; cloud point = -30 o C VGO-range material (370 C+) met fuel oil specifications UOP 5910-35

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