Reconfiguring refineries for LTO?

[Dan Clemmensen + 1,011]

My uneducated understanding is that refineries can be reconfigured a little bit for a small amount of  money, but larger changes in feedstock or product mix require a lot of time and money. The big gulf coast refineries were optimized for converting "cheaper" heavy sour crude into a product mix that maximized profits, so they could not use a lot of LTO, and the US exported the LTO. More recently, I learned that refineries have been gradually reconfiguring to use more LTO. For example, here is an old article from 2018:

https://refineryoperations.com/reconfiguring-hydrocrackers-for-domestic-crudes/

So here is the question for you knowledgeable guys: Is there a way to track this change? Sure, we can just look at crude imports and exports to infer the changes at the macro level, but is there something finer-grained that I can look at? Are the changes complete, or are we continuing to reduce our imports and  refining more domestic crude?

[BLA + 1,666]

14 hours ago, Dan Clemmensen said:

My uneducated understanding is that refineries can be reconfigured a little bit for a small amount of  money, but larger changes in feedstock or product mix require a lot of time and money. The big gulf coast refineries were optimized for converting "cheaper" heavy sour crude into a product mix that maximized profits, so they could not use a lot of LTO, and the US exported the LTO. More recently, I learned that refineries have been gradually reconfiguring to use more LTO. For example, here is an old article from 2018:

https://refineryoperations.com/reconfiguring-hydrocrackers-for-domestic-crudes/

So here is the question for you knowledgeable guys: Is there a way to track this change? Sure, we can just look at crude imports and exports to infer the changes at the macro level, but is there something finer-grained that I can look at? Are the changes complete, or are we continuing to reduce our imports and  refining more domestic crude?

Yes

Back 8 to 10 years ago of the approx 8 mm bbl/day gulf refining capacity a little more than half was heavy oil. The reason U.S. reserves were dropping and once again U.S. was squeezed by OPEC.  U.S first invested heavily in Venezuela , that was nationalized . . bye bye .

Then the U.S. oil companies  invested $ hundreds of billions in Canadian tar sands. (Exxon still hasn't written down their invest there ~ $30 Billion ). 

Then along came shale.  At first many still built or converted to heavy oil refineries example Aramco Motiva.  Heavy oil had greater diesel yield and there was a healthy market for it in Central and South America.

The petrochemical industry loved the LTO and NGL product. At one time around 2013/2014 I counted 17 new Petrochemical plants planned and built on the Gulf of Mexico.

Gasoline Refiner pure play Valero converted one of their refineries to accommodate LTO and accomplished a 30% ROI. Others followed.

Exxon finished an addition to their Port Arthur plant that handled LTO about a year or two ago. Like everything there are too many refineries.  Too much capacity. 

Heavy oil refineries need to ad a coker unit and add fortified distillation towers have to be built with hardened (expensive) metals like molybdenum or nickel as the tar sands oil is extremely caustic at and above 150°.

Most refineries can process LTO by adding a  Condensate Splitter.  There is more to it than that but that's the basic.  

As the demand for gasoline and distillates plateaus and declines U.S. shale should have world wide markets for its shale LTO and NGL products for the Petrochemical industry.

 

Edited November 11, 2020 by BLA