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optimalization of petrochemical feedstocks in ... - CMT Conferences
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OPTIMALIZATION OF<br />
PETROCHEMICAL FEEDSTOCKS<br />
IN INDONESIA<br />
BY : MR. SURYA ARMANSYAH<br />
CORPORATE PLANNING DIVISION,<br />
PERTAMINA , INDONESIA<br />
6 th ASIA/CHINA PETROCHEMICAL<br />
FEEDSTOCK MARKETS CONFERENCE<br />
Shenzhen, Ch<strong>in</strong>a, 14 -15 MAY 2007
OUTLINE :<br />
I. INTRODUCTION<br />
1. Oil and Gas Law No. 22/2001 and Government Regulation<br />
No. 36/2004 and it’s impact on Upstream and Down<br />
stream Oil & Gas Bus<strong>in</strong>ess<br />
2. Indonesia Oil and Gas Reserves, 2005<br />
II. INDONESIA<br />
PETROCHEMICA<br />
LS INDUSTRY<br />
OUTLOOK<br />
1. Petrochemical Industry Cha<strong>in</strong>.<br />
2. Strength and Weakness <strong>of</strong> Indonesia Petrochemicals Industry<br />
3. Ma<strong>in</strong> Olef<strong>in</strong>s & Aromatics Producers In Indonesia (Chandra Asri,<br />
PERTAMINA and TPPI)<br />
4. Domestic Petrochemicals Feedstocks Balance (Gas, Naphtha and<br />
Condensate)<br />
5. Oil Price Prediction<br />
6. Limitation <strong>of</strong> Gas, Naphtha and Condensate Supplied for Domestic<br />
Petchem Feedstocks Demand<br />
PT PERTAMINA (PERSERO) 2
III. NATIONAL<br />
OPTIMALIZATION<br />
FOR PETCHEM<br />
FEEDSTOCKS<br />
1. Optimize Petchem Feedstock for Domestic<br />
Industries (Natural Gas, Condensate and<br />
Naphtha),<br />
2. Feedstock Price Policy (Gas Price)<br />
IV. PERTAMINA’S<br />
PETCHEM<br />
FEEDSTOCK<br />
STRATEGY FOR<br />
OPTIMALIZATION<br />
1. Utiliz<strong>in</strong>g Offgas ex RCC for Propylene<br />
production<br />
2. Utiliz<strong>in</strong>g Natural Gas for produc<strong>in</strong>g<br />
Petrochemicals/Oil products or LNG<br />
3. Utiliz<strong>in</strong>g Sr. Kerosene for N-Paraff<strong>in</strong><br />
production<br />
4. Optimiz<strong>in</strong>g Gas Production from new field for<br />
Fertilizer Plants Feed or Public Gas Services<br />
CONCLUSION<br />
PT PERTAMINA (PERSERO) 3
I.1. INTRODUCTION<br />
NEW REGULATION FOR OIL & GAS SECTOR IN INDONESIA<br />
(Implementation <strong>of</strong> Oil & Gas Law No. 22/2001 and<br />
Government Regulations No. 35 & 36/2004)<br />
BEFORE<br />
AFTER<br />
Regulator<br />
Operator<br />
Custodion for<br />
Oil & Gas<br />
Reserved<br />
PERTAMINA Regulate and<br />
Supervise Upstream &<br />
Down Stream Bus<strong>in</strong>ess<br />
PERTAMINA as a S<strong>in</strong>gle<br />
Operator/<br />
Monopoly <strong>in</strong> Downstream<br />
Bus<strong>in</strong>ess and as a Coord<strong>in</strong>ator for<br />
all upstream Bus<strong>in</strong>ess <strong>in</strong><br />
Indonesia (PSC)<br />
PERTAMINA Manage for Oil &<br />
Gas Bus<strong>in</strong>ess, as a<br />
Representative <strong>of</strong> the<br />
Government)<br />
• DIRJEN MIGAS<br />
• UPSTREAM : BP<br />
MIGAS<br />
• DOWNSTREAM :BPH<br />
MIGAS<br />
PERTAMINA merely a<br />
Player <strong>in</strong> Upstream<br />
/Downstream<br />
Bus<strong>in</strong>ess similar to<br />
others<br />
• BP MIGAS<br />
• BPH MIGAS<br />
BP MIGAS : Regulatory Agency for Upstream Bus<strong>in</strong>ess.<br />
BPH Migas : Regulatory Agency for Downstream Bus<strong>in</strong>ess<br />
PT PERTAMINA (PERSERO) 4
I.2.a. Indonesia Oil Reserves, 2005<br />
Riau as ma<strong>in</strong><br />
reserves<br />
• Indonesia total oil reserves (2005) around 8,6<br />
Billion barrels.<br />
• Reserves to production ratio = 18 years.<br />
Source : ESDM 2005<br />
PT PERTAMINA (PERSERO) 5
I.2.b. Indonesia Gas Reserves , 2005<br />
(Cont<strong>in</strong>ued)<br />
• Indonesia Gas Reserves around 188 TSCF (2005)<br />
which ma<strong>in</strong> reserves located <strong>in</strong> Natuna, East<br />
Kalimantan, Irian Jaya and South Sumatera.<br />
For Natuna Reserves is not produced yet.<br />
• Reserves to production ratio = 61 years.<br />
Source : ESDM, 2005<br />
PT PERTAMINA (PERSERO) 6
II.1. Petrochemical <strong>in</strong>dustry cha<strong>in</strong> <strong>in</strong> Indonesia<br />
Oil/gas <strong>in</strong>dustry<br />
Petrochemical <strong>in</strong>dustry<br />
User <strong>in</strong>dustry<br />
Feedstock Upstream Midstream/downstream Consumer goods<br />
1. Naptha<br />
2. Condensate<br />
(US$ 1-2 bil/plant) (US$.1-0.4 bil/plant)<br />
[Anyer]<br />
Ethylene<br />
Propylene<br />
EDC/VCM<br />
EG<br />
SM<br />
PE<br />
PP<br />
PVC<br />
PS/EPS<br />
Plastic process<strong>in</strong>g<br />
film, sheet, bags,<br />
bottles<br />
House ware,<br />
toiletries, toys<br />
Auto mobile parts,<br />
appliances,<br />
electronics goods &<br />
component<br />
PTA<br />
SBR<br />
PET<br />
Synthetic rubber<br />
Synthetic textile, pet<br />
bottles<br />
[Cilacap, Tuban]<br />
Benzene<br />
P-Xylene<br />
o-Xylene<br />
LAB<br />
PA<br />
DOP<br />
[Anyer/Merak/Cilegon]<br />
Detergent<br />
Plasticizer<br />
3. Natural Gas<br />
(Methane,Ethane)<br />
(US$0.2-0.4 bil/plant)<br />
Methanol<br />
plant<br />
[Bontang, Bunyu]<br />
Methanol<br />
Ammonia<br />
plant<br />
Formaldehyde<br />
Solvent, MTBE, Chemicals<br />
Res<strong>in</strong>s, Chemicals<br />
Solvent, Chemicals,<br />
Explosives<br />
[Bontang,<br />
Palembang, et all]<br />
Methanol<br />
Urea<br />
Fertilizer, Res<strong>in</strong>s,<br />
Adhesives<br />
PT Source, PERTAMINA Deper<strong>in</strong>, (PERSERO) 2007<br />
7
A. STRENGTH :<br />
II.2. STRENGTH & WEAKNESS OF PETCHEM<br />
INDUSTRY IN . INDONESIA<br />
1. Rich Gas, Oil and Coal resources that could be utilized as<br />
Petrochemicals feedstock.<br />
2. Industries that use <strong>petrochemical</strong>s products such as textiles are<br />
developed.<br />
3. Low Labor cost<br />
B. WEAKNESS :<br />
1. Petrochemicals Industry and it’s feedstock are not so l<strong>in</strong>ked, due<br />
to some feedstock still imported.<br />
2. Infrastructure support such as Power Generators to be cont<strong>in</strong>ued<br />
developed to support Petrochemicals Industries zone.<br />
3. Some Petrochemicals Industries still stand alone ( not <strong>in</strong>tegrated<br />
yet between upstream-midstream and downstream Cha<strong>in</strong>)<br />
Source : PTM, 2006<br />
PT PERTAMINA (PERSERO) 8
II.3 MAIN PETROCHEMICALS INDUSTRY PROFILE IN<br />
INDONESIA<br />
CHANDRA ASRI<br />
PETCHEM INDUSRY<br />
Import<br />
Naphtha/Condensate<br />
1,300<br />
Olef<strong>in</strong> Plant<br />
Ethylene<br />
+70 (2007)<br />
525<br />
GT Petrochem<br />
Import<br />
Ethylene<br />
Try Polyta<br />
(Unit : 1,000 t/y) (As <strong>of</strong> end 2006)<br />
Titan *1<br />
SMI<br />
Asahimas/Satomo<br />
SEI<br />
LL/HDPE<br />
+20<br />
HDPE<br />
+15<br />
LL/HDPE<br />
MEG<br />
SM<br />
EDC<br />
VCM<br />
PVC<br />
Ethyl Acetate<br />
200<br />
100<br />
450<br />
216<br />
340<br />
360/265<br />
400/100<br />
285/85<br />
70<br />
Propylene<br />
+40 (2007)<br />
PP<br />
Import Propylene<br />
360<br />
Acrylic Acid<br />
60<br />
Acrylic Ester<br />
Nippon Shokubai *2 100<br />
Source : Deper<strong>in</strong>, 2007<br />
C4<br />
fraction<br />
Pyrolysis<br />
Gasol<strong>in</strong>e<br />
200<br />
Recycle<br />
(Feedstock source f or suspended C4 derivatives project)<br />
(Feedstock source f or suspended aromatics project)<br />
240<br />
PT PERTAMINA (PERSERO) 9
II.3 MAIN PETROCHEMICALS INDUSTRY PROFILE IN<br />
INDONESIA (cont<strong>in</strong>ued)<br />
.<br />
Light Naphtha<br />
(Unit : 1,000 t/y) (As <strong>of</strong> end 2006)<br />
TPPI<br />
PETCHEM INDUSRY<br />
1,800<br />
Domestic/Import<br />
Heavy Naphtha<br />
Condensate<br />
4,500<br />
Aromatic<br />
Plant<br />
Benzene<br />
230<br />
Toluene<br />
100<br />
Condensate<br />
Splitter<br />
Bottoms<br />
JGC/UOP<br />
O-Xylene<br />
P-Xylene<br />
120<br />
500<br />
Kerosene/Diesel<br />
300/140<br />
Reformat<br />
282<br />
Source : Deper<strong>in</strong>, 2007<br />
PT PERTAMINA (PERSERO) 10
II. 3 MAIN PETROCHEMICALS INDUSTRY PROFILE IN<br />
INDONESIA (cont<strong>in</strong>ued)<br />
Ref<strong>in</strong>eries<br />
Aromatics<br />
Plants<br />
Naptha<br />
PX<br />
Benzene<br />
TA/PTA<br />
Plant<br />
Propylene<br />
Ex. FCCU<br />
Offgas<br />
ex. RCC<br />
PP Plant<br />
Propylene<br />
Recovery<br />
Unit<br />
PP<br />
PERTAMINA’S PETROCHEM INDUSTRIES<br />
Propylene<br />
Product<br />
PX<br />
PTA<br />
PP<br />
Propylene<br />
Benzene<br />
PTA<br />
Capacity<br />
(T/Year)<br />
270.000<br />
225.000<br />
45.000<br />
180.000<br />
100.000<br />
Source : PTM, 2007<br />
PT PERTAMINA (PERSERO) 11
II.4. Domestic Petchem Feedstocks Balance<br />
Case : Gas Balance, <strong>in</strong> 2005<br />
PERTAMINA<br />
1.03 BSCFD<br />
• Ma<strong>in</strong> Gas consumption as feed <strong>of</strong> LNG Plants<br />
• In 2008, Total Gas Production will be around 9,15<br />
BSCFD which PERTAMINA Production is expected =<br />
1,65 BSCFD.<br />
CONSUMPTION<br />
(%)<br />
FERTILIZER/PETROCHEMICAL<br />
REFINERY<br />
L P G<br />
7.3<br />
0.5<br />
0.9<br />
PGN<br />
7.69<br />
PSC<br />
7.10 BSCFD<br />
PROD.<br />
8.13 BSCFD<br />
DOMESTIC<br />
41.6%<br />
PLN / ELECTRICITY<br />
STEEL INDUSTRY<br />
OTHER INDUSTRIES<br />
5.4<br />
0.0<br />
5.8<br />
OWN USE<br />
10.4<br />
LOST / FLARE<br />
3.7<br />
T O T A L<br />
41.6<br />
L N G<br />
47.2<br />
EXPORT 58.4%<br />
L P G<br />
GAS PIPELINE<br />
3.7<br />
7.5<br />
Source : ESDM, 2006<br />
T O T A L<br />
58.4<br />
PT PERTAMINA (PERSERO) 12
II.4. Domestic Petchem Feedstocks Balance<br />
Case : Condensate Gas Balance, <strong>in</strong> 2006<br />
Imported<br />
Unit : MTPA<br />
1.8<br />
Production<br />
5.8<br />
2.6<br />
3.2<br />
Domestic<br />
Consumption<br />
• PTM : 4.4<br />
•TPPI : 1.8<br />
Exports<br />
Source : Deper<strong>in</strong>, 2007<br />
PTM : PERTAMINA<br />
TPPI : TRANS PACIFIC PETROCHEMNICALS IND.<br />
PT PERTAMINA (PERSERO) 13
II.4. Domestic Petchem Feedstocks Balance<br />
Case : Naphtha Balance, <strong>in</strong> 2005<br />
Imported<br />
Unit : MTPA<br />
1.3<br />
Production<br />
7.8<br />
6.9<br />
Domestic<br />
Consumption<br />
• PTM : 6.9<br />
• C.A : 1.3<br />
0.9<br />
Exports<br />
Source : Deper<strong>in</strong>, 2007<br />
PT.PERTAMNA<br />
CA : CHANDTA ASRI PETROCHEM INDUSTRY<br />
PT PERTAMINA (PERSERO) 14
II.5 OIL PRICE PREDICTION BY SOME<br />
INSTITUTIONS (US $ / bbl )<br />
100<br />
90<br />
80<br />
70<br />
60<br />
50<br />
40<br />
30<br />
20<br />
10<br />
0<br />
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2015 2020<br />
Actual Price 28.74 24.11 25.6 29.52 36.85 54.01 65.80<br />
FACTS, High Price 54.01 64.50 64.75 69.90 74.95 80.40 91.65 86.40<br />
FACTS, Base Price 54.01 52.68 56.13 59.69 63.08 66.68 75.61 68.99<br />
FACTS, Low Price 54.01 39.30 39.00 42.20 42.40 42.65 48.70 53.00<br />
EIA,High Price, WTI 54.01 59.10 59.26 59.87 61.12 62.65 76.30 85.06<br />
EIA, Ref. Price, WTI 54.01 55.46 55.62 52.30 50.14 47.29 47.79 50.70<br />
EIA, Low Price, WTI 54.01 53.70 53.86 48.88 44.91 40.29 33.78 33.99<br />
PERTAMINA, Ref. Price 54.01 62.90 63.60 63.26 62.91 62.57 63.26<br />
PERTAMINA, High Price 54.01 66.92 65.25 68.35 67.63 65.03 69.81<br />
Indonesia Crude Oil (SLC) Price will be <strong>in</strong> the range <strong>of</strong> 56 - 65 US/bbl (<strong>in</strong> 2007) as per FACTS<br />
Prediction<br />
PT PERTAMINA (PERSERO) 15
II. 6. LIMITATION OF GAS, NAPHTHA AND<br />
CONDENSATE SUPPLIED FOR DOMESTIC<br />
PETCHEM FEEDSTOCKS<br />
A. GAS SUPPLIED AND PRICE :<br />
• Most <strong>of</strong> Natural Gas utilized as feed <strong>of</strong> LNG, LPG (58 %) and<br />
only 7,3 % for Petchem Feedstock .<br />
• Different Gas Price for Fertilizer Plant (Government Subsidy )<br />
and Petrochemical Plants)<br />
• High World Oil and Gas Price and it’s impact to Feedstock<br />
distribution<br />
B. CONDENSATE SUPPLIED.<br />
Ma<strong>in</strong>ly Condensate Supplied by PSC’s (Upstream Production<br />
Shar<strong>in</strong>g Contractors) and mostly is exported . For Pertam<strong>in</strong>a’s<br />
production is own use.<br />
C. NAPHTHA SUPPLIED.<br />
Ma<strong>in</strong>ly Naphtha Supplied by PERTAMINA. Beside own use , it<br />
is also exported due to Project F<strong>in</strong>anc<strong>in</strong>g Agreement<br />
(Product Swap to Lenders ), so some Domestic Indutries<br />
should import for their requirements.<br />
PT PERTAMINA (PERSERO) 16
III. OPTIMALIZATION OF NATIONAL PETCHEM<br />
FEEDSTOCKS (Solution required)<br />
A. Domestic Petchem Feedstocks Optimalization :<br />
Optimize the utilization <strong>of</strong> Gas, Naphtha and<br />
Condensate ex Domestic Production for Fertilizer<br />
Plants, Olef<strong>in</strong>/Aromatic Plants, due to the facts that<br />
there is still huge export <strong>of</strong> Gas, Naphtha and<br />
Condensate but contrary it is also still high quantity<br />
imported <strong>of</strong> naphtha and Condensate for Domestic<br />
Petchem feedstock.<br />
B. GAS PRICING POLICY FOR PETROCHEMICALS PLANTS.<br />
Government to be have the same treatment for Gas<br />
Price Policy both utilized as Petchem Feedstock<br />
(Fertilizer Plants) and as fuel gas for Power<br />
Generation.<br />
Source : PTM, 2006<br />
PT PERTAMINA (PERSERO) 17
IV. OPTIMALIZATION OF PERTAMINA’S PETCHEM<br />
FEEDSTOCKS FOR OPTIMAL RETURNED<br />
Utilized Sr.<br />
Kerosene as Feed<br />
<strong>of</strong> N-Paraff<strong>in</strong> Plant<br />
Utilized Offgas for<br />
produc<strong>in</strong>g Propylene<br />
Optimization<br />
Plan<br />
Optimized Gas for<br />
Fertilizer Plants<br />
Utilized Natural<br />
Gas for LNG Plant<br />
Projects<br />
(Math<strong>in</strong>dok)<br />
Optimized Gas<br />
Production ex Fields for<br />
i.e. Petchem Feedstock<br />
Source : PTM, 2006<br />
PT PERTAMINA (PERSERO) 18
IV. 1. Utiliz<strong>in</strong>g Off gas ex RCC for Propylene<br />
Production<br />
- Off gas ex RCC utilized as feed for Propylene<br />
Recovery Unit for gett<strong>in</strong>g Propylene product.<br />
- PRU should be modified Includ<strong>in</strong>g Catalyst<br />
Cooler, Butane Column etc<br />
PT PERTAMINA (PERSERO) 19
IV.1.a. Simplified Process Flow Diagram <strong>of</strong> Propylene Plants<br />
PT PERTAMINA (PERSERO) 20
IV. 2, Utiliz<strong>in</strong>g Natural Gas as feed <strong>of</strong> GTL or LNG Plant for<br />
Petrochemicals or LNG Production<br />
Case : Math<strong>in</strong>dok Gas Reserves , Central Sulawesi<br />
LUWUK<br />
PT PERTAMINA (PERSERO) 21<br />
POSODONGGI<br />
DONGGILUWUK
IV.2.a. GTL Math<strong>in</strong>dok Technology<br />
Source : PTM, 2006<br />
PT PERTAMINA (PERSERO) 22
Mat<strong>in</strong>dok GTL Technology (Cont<strong>in</strong>ued)<br />
It is required 4 years m<strong>in</strong>imum to<br />
complete the GTL Project until<br />
commercial stage<br />
Source : PTM, 2006<br />
PT PERTAMINA (PERSERO) 23
IV. 3. Utiliz<strong>in</strong>g Sr. Kerosene as feed <strong>of</strong> N-Paraff<strong>in</strong><br />
Plant<br />
RAW MATERIAL BALANCE ( SR. KEROSENE)<br />
CDU-DMI<br />
19.40 16.10 20.60<br />
NPP - DMI<br />
3.20<br />
N. PARAFFIN<br />
TANK<br />
3.30<br />
17.20<br />
150,000 TPA<br />
20.5 23.0<br />
UPMS I<br />
2.50<br />
4.50<br />
HCU-DMI<br />
CDU-SPK<br />
6.60<br />
2.10<br />
DEPO-SIAK<br />
Source : PTM, 2007<br />
PT PERTAMINA (PERSERO) 24
IV.3.a. ABS Process Flow Diagram<br />
(Benzene and N-Paraff<strong>in</strong> as feed)<br />
Ref<strong>in</strong>ery<br />
H2 Rich<br />
N - Paraff<strong>in</strong><br />
Plants<br />
Benzene<br />
Sr. Kerosene<br />
N_Paraff<strong>in</strong><br />
ABS Plant<br />
Returned Kero<br />
Alkyl Benzene<br />
Sulfonates<br />
Source : PTM, 2007<br />
PT PERTAMINA (PERSERO) 25
IV. 4. Optimiz<strong>in</strong>g Gas Production from new fields<br />
No<br />
PROJECT<br />
Location<br />
1<br />
2<br />
South Sumatera Gas Development<br />
(just on production)<br />
Cepu Gas Development<br />
South Sumatera<br />
(300 MMSCFD)<br />
Central & East Java<br />
3<br />
NGL Gas<br />
Plaju, South Sumatra<br />
Projects are required for <strong>in</strong>creas<strong>in</strong>g gas supply for domestic<br />
market i.e Fertilizer Plants, City Gas and other <strong>in</strong>dustries.<br />
Source : PTM, 2006<br />
PT PERTAMINA (PERSERO) 26
CONCLUSIONS<br />
• There is potential for further development <strong>of</strong> the Petrochemicals Industry<br />
s<strong>in</strong>ce Indonesia is a producer <strong>of</strong> feedstock and also there are various that<br />
can utilizes <strong>petrochemical</strong>s products.<br />
• Condensate and Naphtha for Domestic Supply should be <strong>in</strong>creased <strong>in</strong><br />
order to match with the requirements, f<strong>in</strong>ally it will optimiz<strong>in</strong>g the<br />
<strong>petrochemical</strong>s <strong>in</strong>dustry<br />
• Gas Pric<strong>in</strong>g Policy for Petrochemicals Plants beside Fertilizer Plants to be<br />
reviewed that also consider<strong>in</strong>g the high world oil price and it’s utilization<br />
for Petrochemicals Industry.<br />
• Promot<strong>in</strong>g <strong>of</strong> more effective for the utilization <strong>of</strong> Ethane rich gas<br />
resources both for LNG Plants, Public City Gas and as Petrochemicals<br />
Feedstock<br />
• PERTAMINA also has and <strong>in</strong> progress to get an optimum return by<br />
<strong>optimalization</strong> <strong>of</strong> Gas, Naphtha and Condensate for Oil and<br />
Petrochemicals products.<br />
PT PERTAMINA (PERSERO) 27