Alberta Syncrude upgrade projects: Good news for ULSD

Diesel Fuel News, April 15, 2002 by Jack Peckham

Friendly, peaceful Alberta, Canada is home to the world's largest oil deposit -- 2.5 trillion barrels of bitumen, five times more than the conventional oil reserves of Saudi Arabia, and (thankfully) worlds away from the sickening violence wracking the oil-rich Middle East today.

However, it's technologically easier to drill in Saudi sands than to scoop out Alberta oil sands. So, many still put their easy-dollar bets on Mideast oil, hoping not to get blown up in the process.

Putting dollars in Alberta involves a quite different challenge.

Extracting Alberta's bitumen -- a black, naphthenic hydrocarbon with an API gravity of about 10[degrees] and a sulfur content from 4-6% -- requires substantial upgrading investment and continuing technological innovation.

So, Syncrude Canada (a nine-company joint venture), Suncor and others have continued to refine their techniques since oil-sands production first began in the 1960s.

Results are impressive: Today, Syncrude boasts that it has cut unit operating costs in half, while slashing "syncrude sweet blend" (SSB) production costs to below (U.S.)$11.30/barrel, comparable to finding and developing new sources of conventional crude oil."

Now there's more good news: Syncrude's owners are going ahead with a (U.S.)$2.6 billion "Stage 3" expansion project that will boost syncrude output to 375,000 barrels/day, probably by end-2004, up from 250,000 b/d today.

Syncrude makes a mix of three streams: heavy gasoil, light gas oil and naphtha, then reblends these streams for pipeline shipping as a single "sweet" syncrude.

Just over $325 million of the "Stage 3" project is dedicated to construction and revamp of hydrotreating units. The revamp portion is a major modification of an existing hydrotreater, while the other portion is a new, 85,000 b/d "Synshift/Synsat" processing complex (Criterion Catalyst/ABB Lummus process technology, licensed by ABB Lummus for this project) to upgrade the quality of the diesel fuel yield that later will be obtained at customer refineries.

Synshift handles "tough" molecules in hydrocarbon streams, saturating aromatics and cracking polynuclear aromatic compounds apart.

Result: This process will boost Syncrude's cetane number to 40 (from about 33 today), improve the quality of both diesel and jet fuel streams, cut sulfur levels so low that further hydrotreating won't be required at customer refineries for U.S. EPA/Environment Canada 15-ppm sulfur limits for 2006 ultra-low-sulfur diesel (ULSD), and cut sulfur levels further in remaining syncrude streams as well.

* Cold-Flow Retained

What's more, the excellent cold-flow characteristics -- for which Alberta syncrudes and synthetic diesels are justifiably famous -- will be retained, as Syncrude Canada's strategic projects Executive VP Murray Smart told us.

This is especially important to Canadian and northern-tier U.S. refiners that have a strong appetite for distillate fuels that can flow properly during the region's bitterly cold winters.

The higher cetane level also will make it possible for North American refiners to use greater portions of Alberta syncrude in their feed streams, as 40 cetane number is the minimum for highway diesel, per revised American Society for Testing & Materials D975 standards (see Diesel Fuel News 12/10/2001, p6).

"If you run our feedstock, you'll be able to run a lot more of it," thanks to the Stage 3 upgrading project, Smart explains. "We believe that by adding quality, we'll have a product that refiners will want even more."

The catalytic-cracker feedstock portion of Syncrude's output stream perhaps will be the only portion of this ultra-sweet syncrude requiring further hydrotreating at customer refineries.

Still, it's conceivable that even the cat feed portion of these future Syncrude streams wouldn't necessarily require further hydrotreating, if future testing reveals the true power of these new "Stage 3" hydrotreating units, one knowledgeable technology developer suggests.

The quality upgrading portion of this Stage 3 project is already 45% complete in detailed engineering and procurement phase. Major construction on the upgrading projects will start during the third quarter of this year.

Meantime, the oil-sands mining expansion portion of this project is already 80% engineered and actual construction is just starting now, Smart told us.

Figuring out the quality upgrade portion of Syncrude Canada's "Stage 3" project didn't happen overnight, explains Art Suchanek, developer of the "Synshift" process for Criterion. Rather, the concept, design and upgrading strategy evolved as an "alliance" between Syncrude and Criterion over many years, thanks to joint initiatives by Syncrude's Smart and the late Cesar Trevino (formerly at Criterion), Suchanek told us.

Such cooperative, evolutionary development between hydrocarbon processors and technology providers is "key" to optimize complex projects such as Syncrude's Stage 3, he said. Many refiners could likewise benefit by a similar model, Suchanek argues.

Meantime, Suncor announces that its separate "Project Millennium" will boost its Alberta oil-sands production to 225,000 b/d by year-end, more than doubling Suncor's 1999 oil-sands production rate. Suncor further plans more expansion projects that will boost production to more than 500,000 b/d by 2010.