kbr technology business - platts · kbr technology business ... metathesis 4% mto 1% others other...
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©2013 KBR, Inc. All Rights Reserved 1
KBR Technology Business Tanya Niu ------ Director, Chemicals
Platts Olefins Asia 2014, Shanghai, China 6-7 March, 2014
©2013 KBR, Inc. All Rights Reserved 2
Agenda
Introduction to KBR and KBR Technology
Olefins Market Overview
– Impact on Propylene Markets
Propylene-on-Demand Technology Options
KBR Options for Propylene Production
©2013 KBR, Inc. All Rights Reserved 3
Agenda
Introduction to KBR and KBR Technology
Olefins Market Overview
– Impact on Propylene Markets
Propylene-on-Demand Technology Options
KBR Options for Propylene Production
©2013 KBR, Inc. All Rights Reserved 4
KBR at a Glance
Revenue: $7.9 Billion
(FY2012)
Backlog: $14.9 Billion
(YE2012)
Headquarters in Houston,
Texas
4 Business Groups, 13
Business Units
27,000 employees; 70+
countries
©2013 KBR, Inc. All Rights Reserved 5
KBR Technology Introduction
KBR Technology (TBU) is the
licensing arm of KBR
– Business Unit was created in 2008
– Prior licensing through EPC projects
Commercializes a collection of
technologies developed or acquired
by KBR
Monetizes the value of KBR
proprietary technologies
Main business focus Technology
Licensing
– Other adjacent services enhance
value to customer and to KBR
Technology License
Proprietary Equipment and Catalysts
Basic Engineering and Design
Support for Detailed Engineering
Commissioning and Start-Up Services
Plant Operations Management Systems
Operator Training Simulators
Technical Services and Studies
Revamping and Retrofits
©2013 KBR, Inc. All Rights Reserved 6
KBR Technology Portfolio
Refining
• ROSE®
• FCC
• VCC™
• HydroProcessing
Olefins
• SCORE™
• K-COT™
Chemicals
Ammonia and Syngas
• Phenol
• BPA
• PVC
• NExOCTANE™ and
NExETHERS™
• TRIG™
• Power applications
• Industrial
applications
Automation and Process Technologies
• InSite™ Performance
Monitoring
• OTS
• OMS
• Technical Services
Proprietary
Equipment
• Refining
• Coal
Monetization
• Olefins
• Chemicals
• Ammonia and
Syngas
• Ammonia
• Fertilizers
• Syngas
• Hydrogen
Coal Monetization
©2013 KBR, Inc. All Rights Reserved 7
SCORE™ • Reliable and flexible process, easy operation and
low maintenance needs
• Best return on investment: Low CAPEX and OPEX
• Small footprint
• Tailored coil design to meet customer’s objectives
K-COT™ • Flexible feed: capable of processing C4-C10 olefinic,
paraffinic or mixed feeds
• Higher propylene-to-ethylene ratio
Olefins
©2013 KBR, Inc. All Rights Reserved 8
Chemicals
Phenol: Delivers high quality phenol and acetone at low
long term cost of production, with high yields, low energy
and high on-stream time. KBR has licensed 50% of the
world's phenol capacity.
NExOCTANE™: Highly selective, commercially proven
technology for dimerization of isobutylene to iso-
octene/iso-octane.
NExETHERS™: The ultimate technology for the combined
production of MTBE, TAME and heavier ethers or their
counterparts ETBE, TAEE and heavier ethers in one unit.
BPA: Produces the highest quality BPA at lowest long-term
cost of production. High selectivity and yield. Low total
installed cost and lowest cost of production.
PVC: Lowest environmental footprint technology for the
production of high quality commodity and specialty PVC.
©2013 KBR, Inc. All Rights Reserved 9
Agenda
Introduction to KBR and KBR Technology
Olefins Market Overview
– Impact on Propylene Markets
Propylene-on-Demand Technology Options
KBR Options for Propylene Production
©2013 KBR, Inc. All Rights Reserved 10
US Shale Gas Boom Brings Surplus NGL
Ethane and Propane profoundly changed NA petrochemical feedstocks
structure with its cost advantage and availability
US NGL production, Million Barrels/Day
©2013 KBR, Inc. All Rights Reserved 11
Impact to Olefins Production
Ethane and propane cracking produces less propylene than naphtha cracking
Propane can be used as feedstock for on purpose propylene production
Source: public literatures
0
20
40
60
80
100
120
Ethylene
Propylene
Typical olefins plant product yields
©2013 KBR, Inc. All Rights Reserved 12
Export Balances: US Propane
Ample propane supply after
retail and petrochemical
feedstock use
US recently becomes the
leading propane exporter,
topping Middle East
– Propane export capacity
expanded with matching gas
processing, pipeline, and
storage
Possible US propane global
price parity concerns PDH
economics
©2013 KBR, Inc. All Rights Reserved 13
Global Propylene Supply Demand Gap Widens
Propylene demand keeps growing: organic growth; new applications
– Propylene demand to go from 80 to 100MM ton in 5 years
Propylene production can’t keep up
– Crackers propylene: ethylene driven; lighter feedstocks
– Refinery propylene: gasoline driven; slow growth
Cracker
55%
Refinery
31%
PDH
5%
Metathesis
4%
MTO
1%
Others
4% Other
14%
Global Propylene Production, 2012
Source: IHS
©2013 KBR, Inc. All Rights Reserved 14
North America Propylene Production
0
2
4
6
8
10
12
14
16
18
2000 2007 2012 2017
PDH
Metathesis
Refinery
Cracker
Cracker production declines further until new projects come up
Refinery propylene battles declining fuel consumption
On purpose production fills the gap
Million Metric Ton
Source: IHS
©2013 KBR, Inc. All Rights Reserved 15
New North America On-Purpose-Propylene
Projects
On Stream Capacity
(KTA)
Technology Location Company
2015 750 PDH Freeport, TX Dow
2015 750 PDH Mt. Belvieu, TX Enterprise
2016 300 PDH Odessa, TX RedTac
2017 600 PDH Point comfort, TX FPC
2017 500 PDH Redwater, AB Williams
2017 1000 PDH Alvin, TX Ascend
On hold 750 PDH Freeport, TX Dow
Petrologistics started up 500 KTA PDH plant in 2010. Another project pending
Seven upcoming PDH projects with a total capacity of 3.9 MM Ton per year
LyondellBasell called off their 225 KTA metathesis project
Feedstock stability important to downstream players in addition to cost
Source: company press releases, IHS
©2013 KBR, Inc. All Rights Reserved 16
Impact on North America Propylene
Derivatives
Reduced PP export for a few years
Impact less prominent to other propylene derivatives
7.5 9.0 7.6
8.4
0
2
4
6
8
10
12
14
16
2000 2007 2012 2017
Others
Propylene Oxide
Polypropylene
Butanols
2-Ethyl Hexanol
Isopropanol
Cumene
Acrylonitrile
Acrylic Acid
Source: IHS
NA propylene demand, Million Ton
©2013 KBR, Inc. All Rights Reserved 17
Impact on Global Propylene Derivatives
Propylene demand growth sensitive to macroeconomics
– Most propylene derivatives tied to durable goods
China
– Strong desire for self sufficiency, building on coal supply
– Favorable tax structure to encourage propane import
– PDH and MTO to make up 1/3 production by the decade end
– Gap remains, despite reduced import
Middle East
– Continue to export, yet slower growth
©2013 KBR, Inc. All Rights Reserved 18
US propylene price high, yet volatile
Tight supply-demand brings price volatility
Strength of derivatives demand and inventory management
Operational outages and seasonal turn around
Alternative RG propylene value and on purpose production economics
Arbitrage opportunity for import
Source: Argus
0
500
1000
1500
2000
2500
2006 2007 2008 2009 2010 2011 2012
Ethylene, $/MT
Propylene, $/MT
©2013 KBR, Inc. All Rights Reserved 19
Agenda
Introduction to KBR and KBR Technology
Olefins Market Overview
– Impact on Propylene Markets
Propylene-on-Demand Technology Options
KBR Options for Propylene Production
©2013 KBR, Inc. All Rights Reserved 20
On-purpose propylene production
Traditionally demand driven in regions with shortages
New Norm: supply driven to take cost advantage of feedstocks
Technologies
– Propane Dehydrogenation (PDH)
– Metathesis
– Methanol to Olefins (MTO / MTP)
– Catalytic Cracking
– High Severity FCC
©2013 KBR, Inc. All Rights Reserved 21
Propane to Propylene (PDH)
High selectivity, >80% propylene yield from propane
Hydrogen typically used as fuel for the process
Fixed bed, fluid bed, and moving bed reactors, all commercialized
Propane/Propylene pricing differentials drives project economics
Market considerations: feedstocks security; derivative competitiveness
Propane Propylene + Hydrogen
Source: Argus
US Pricing
0
500
1000
1500
2000
2500
2006 2007 2008 2009 2010 2011 2012
Propylene, $/MT Propane, $/MT
©2013 KBR, Inc. All Rights Reserved 22
Metathesis (rearrangement of olefins)
Requires high purity ethylene and high purity butene
Commercially proven operation in fixed bed reactors, cyclic operation
Unique set of requirements for positive project economics
– Positive propylene to ethylene price ratio
– Availability and low cost of C4 or
– Ethylene dimerization unit when C4 is not available
Ethylene
2-Butene
Propylene
Ethylene
Metathesis
1-Butene Isomerizes to 2-Butene
©2013 KBR, Inc. All Rights Reserved 23
Methanol to Olefins
Primarily a coal play in China
Capital intensive, especially with syngas and methanol plant
No economic direct methane to propylene route exists
Economics depend low cost feedstocks or methanol
Environmental concerns
Syngas production
Syngas to Methanol
MTO Coal or
Natural Gas
Ethylene
Propylene
Methanol Synthesis
Methanol to Olefins
MTO/MTP
©2013 KBR, Inc. All Rights Reserved 24
Light Hydrocarbon Catalytic Cracking
Feedstocks flexibility
No need for pre-treatment
Either fluidized or fixed beds, using catalysts
Catalytic cracking
Various
refinery and
cracker light
streams
Ethylene
Propylene
©2013 KBR, Inc. All Rights Reserved 25
High Severity FCC
Propylene yield improvement from FCC
Improvement achieved by
– Catalyst and additive modifications
– Process condition changes: pressure, temp, catalyst/oil ratio
– Hardware change
– A variety of technology offerings
2 - 8% FCC propylene yield
15 -25%
©2013 KBR, Inc. All Rights Reserved 26
On Purpose Technologies Comparison
Process Metathesis PDH Catalytic Olefins MTO/MTP
Feedstocks Ethylene &
Butene
Propane C4-C10 Olefins or
Straight Run
Methanol (or
coal/methane)
Ethylene price sensitivity Negative Neutral Positive Positive (MTO)
Feed Pretreatment Significant Significant None to little None
Major Byproducts None None Ethylene
BTX gasoline
Ethylene (MTO)
Water
Economic plant size Small to
moderate
Large Small to large Large
Commercial proven Yes Yes Yes Yes
Capital Investment Low to
moderate
Moderate Moderate Moderate to Large
©2013 KBR, Inc. All Rights Reserved 27
Agenda
Introduction to KBR and KBR Technology
Olefins Market Overview
– Impact on Propylene Markets
Propylene-on-Demand Technology Options
KBR Options for Propylene Production
©2013 KBR, Inc. All Rights Reserved 28
K-COT™ - KBR Catalytic Olefins Technology
Maximize production of
propylene from light
olefinic or paraffinic feeds
– Typical P/E ratio = 2:1 for
olefin-rich feed
– Typical P/E ratio = 1:1 for
straight run naphtha
FCC-based fluidized
reactor
Cryogenic purification for
polymer grade products
Proven, efficient technology
High Propylene-to-Ethylene
Ratio
Feedstock Flexibility
©2013 KBR, Inc. All Rights Reserved 29
MAXOFINTM – KBR High Severity FCC
Maximize production of light olefins from gas oil and resid refinery streams
– 20+ wt % propylene yield
Flexibility to adjust product mix based on propylene and gasoline market conditions
Developed from KBR FCC technology
– Advanced, proven FCC hardware features
– Separate reaction zones for cracking heavy
molecules and light molecules
– ZSM-5 additive
High propylene yield
Flexible product mix
Proven Technology
©2013 KBR, Inc. All Rights Reserved 30
Conclusions
Availability of ethane from US shale gas has shifted the dynamics of the global olefins market
Propylene-on-demand technologies will be needed to close the gap in propylene supply/demand
KBR provides cost effective, proven and efficient technologies to improve your propylene yields