Meeting Archives

Proceedings

Crude Oil Quality Association Meeting
Denver, CO, 10 June 2010

The Association gratefully acknowledges Platts for hosting lunch for all meeting attendees.  Their generosity is greatly appreciated.

Domestic Trading Center Subcommittee (DTC) Report

            “Domestic Sweet / WTI Specifications”, Dennis Sutton, Marathon Petroleum.  Dennis provided a review of the Subcommittee’s history. Following this, he discussed results of the ballot sent to 25 companies and organizations on April 1, 2010. Responses were received from 19 of the 25. Of these, 14 were affirmative on all 7 proposed specifications, one company approved 6 and abstained on the seventh, three companies abstained on all 7 items, and one company (BP) voted negative on the proposed TAN and Ni limits. A number of comments were received which Dennis discussed.

In closing, Dennis noted  that the aim is not to propose any changes to Nymex’s existing specifications for API gravity or sulfur content, but to add 7 additional specifications to help protect the quality of Domestic Sweet crude oil at Cushing, OK. Dennis also noted that the limits proposed in these additional specifications are subject to change as additional data are obtained.

 

            Presentation on BP negatives and their adjudication. Ron Fisher of BP discussed the reasons BP voted negative on the proposed limits on TAN and Ni, using data obtained by the Subcommittee on analyses of samples collected at Cushing. Each negative was discussed individually by the assembled group then voted upon. Both negatives were found to be overwhelmingly non-persuasive by a hand vote of the group, with only the attendees from BP voting in favor of finding the negatives persuasive. Bill Lywood of Crude Quality Inc. then moved that the association prepare and send a letter to “all pipeline and terminal operators at Cushing, OK for discussion with their shippers and to Nymex for their records.” The motion was approved by all present with the exception of the attendees from BP.
 

            “Overview of Cushing Operations”, Max Cummings, Allocation Specialists Ltd. (ASL). ASL specializes in the administration of quality bank operations, trading center trade documentation, and pipeline/terminal scheduling and revenue accounting. Max provided a detailed overview of the complex operations at Cushing, OK, which comprises more than 10 operators. Max illustrated his presentation with diagrams of typical manifold configurations, inter- and intra-terminal transfers, and extra-terminal deliveries. This was followed by an illustration of a typical scheduling and accounting process. Max concluded his presentation by outlining an implementation plan for the additional specifications being proposed for Domestic Sweet, and the services that ASL can provide in support of implementation. 

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During the lunch hosted by Platts, Mr. Larry Foster, Global Editorial Director for Gas & Power, provided an overview of recent events and initiatives affecting the petroleum industry. His comments were especially timely and, in some cases, provided the group a new perspective on some of the issues. 

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General Meeting Presentations

“Update on CCQTA activities”, Randy Segato, Suncor, representing CCQTA. Randy provided background on the CCQTA, the Scope and Current Activity of the seven active projects within the association, and discussed two project proposals that are under consideration.  The currently active projects are: 

• Condensate Quality
• Iron Fouling
• Oilsands Bitumen Processability
• Phosphorus in Crude Oil
• Fluorocarbons in Crude
• TAN Phase IV
• H₂S in Crude

The two project proposals that are under consideration are:

• On-line Contaminant Monitoring
• Heavy Oil Compatibility

The on-line contaminant monitoring project proposes to employ existing instrumentation for monitoring crude oil contaminants.  The heavy oil compatibility project proposes to quantify the impact of instability/incompatibility on crude transportation, desalting and refinery processing. This latter project is expected to launch mid-2010.

 

“Rocky Mountain Petroleum Business Update”, Paul Rolniak, EAI, Inc. For his presentation, Paul used extracts from EAI, Inc.’s 2010 “Rocky Mountain Petroleum Business Analysis & Outlook Study” which is in progress. In opening, Paul provided a global overview in which he briefly discussed world supply and demand as they likely affect the U.S. and crude oil pricing. He then moved to a detailed assessment of the Rocky Mountains region in which he discussed:

• Crude supply logistics
• Refining Trends and Update
• Rocky Mountain downstream business
• New production activity

Paul provided a detailed assessment of each topic, illustrating his presentation with graphic and tabular data depicting trends and projections. For the Rocky Mountain Region, these latter included: 

• Refined Product Network
• Refinery Throughput Profile, 2004 – May 2010
• Western Canada Crude Supply Outlook
• Crude Production Trends and Outlook

In closing, Mr. Rolniak discussed the Williston Basin Bakken activity and the Niobrara Fractured Limestone Fairway. Production from these – especially the Bakken – is forecast to continue increasing until about 2013 before slowly declining.

 

 “Enbridge Pipelines (North Dakota)”, Ashok Anand, Enbridge.  Ashok provided a brief overview of the entire Enbridge pipeline system, following which he discussed their North Dakota and Saskatchewan systems. The Saskatchewan system gathers crude oil from a number of points and delivers it to the main Enbridge pipeline at Cromer, MB. This pipeline continues SE to Clearbrook, MN where deliveries from North Dakota tie-in. Currently, the pipeline from Minot, ND is able to deliver 170,000 B/D to Clearbrook.

 Enbridge is studying reactivation of the Portal Link which would transport crude oil northward from North Dakota to the Westspur system in Saskatchewan then to Cromer. This is planned to be in service in 1Q2011. Finally, Ashok described Enbridge’s planned Bakken Pipeline Expansion Project to transport crude oil through a new 16” line from Berthold, ND to Steelman, SK. This is planned to be in service in 1Q2013, with an initial capacity of 140,000 B/D. 

 

 “The Use of DRA in Crude Oil”, Dr. David Schwartz, Baker Hughes.  Drag Reducing Agents (DRA) were first used in crude oil in 1979 in the TransAlaska Pipeline System. Since then, over 100 billion barrels of crude oil have been treated worldwide with these agents with no major problems reported. The benefits of DRA include: 

• Increased throughput
• Energy savings
• Scheduling flexibility
• Derated periods

Considerable fate testing on DRAs in desalters, refined product quality, and process impact has been conducted. David provided several illustrations of this in his presentation. In general, 95% of DRA remains in crude oil and does not cause problems in desalter units. The DRA degrades at about 400°C into its monomers in the vacuum distillation unit where their behavior is similar to other non-volatile hydrocarbons. Despite the considerable experience and testing indicating process impacts should be small, challenges remain for DRAs. Among these are refiners’ perceptions of DRA risk vs. reward.

For the record, David provided supporting information that is included with the posted presentation. 

 

(ed. as of 2017, please visit http://www.liquidpower.com for current information related to this presentation) ”Heavy Oil Drag Reducing Agent (DRA): Increasing Pipeline Deliveries of Heavy Crude Oil“, Laura Thomas and Tim Burden, ConocoPhillips Speciality Products Co. (CSPI). CSPI partnered with Ecopetrol and Delrio in Colombia in a flow improver test using the new DRA, ExtremePower™ Flow Improver. Two heavy crude oils – one 18°API; the second 21°API – were batched through a 120 km pipeline over mountainous terrain. The field trial resulted in an approximately 25% increase in throughput. No adverse refinery impacts were observed in lab testing and field application.  

• No negative impacts were noted on desalter dewatering rates
• Wastewater quality was unchanged with no increase in oil or change in COD evident
• Laboratory testing showed no difference in quality of product cuts from treated vs. untreated oil
• Following thermal decomposition at 700°F, all decomposition products were benign.

 

            “Suncor Denver Refinery Overview”, Randy Segato, Suncor.  In 2003, Suncor acquired the ConocoPhillips Commerce City refinery, having a nominal capacity of 60,000 B/D. This coincided with the formation of Suncor Energy USA. The following year, a $300 million investment in the refinery was announced. In 2005, Suncor acquired the adjacent Valero refinery with a nominal capacity of 30,000 B/D. Integration of the two refineries provides a number of key process units able to produce LPG, multiple grades of gasoline, LSD and ULSD, jet fuel, and PG grade asphalt.

Suncor’s investment in the integrated refinery has grown to $445 million with initiation of Project Odyssey, which will result in a number of production upgrades. A key element of Project Odyssey is installation of a new gasoil hydrotreater and upgraded metallurgy allowing the refinery to handle all high TAN crudes, including Suncor synthetics, Canadian heavy grades, Colorado Sweet, and other PADD 4 crudes.

 

            “Bakken --- Buzz-Buzz-Buzz”, Anne Shafizadeh, Chevron Energy Technology Co.  Anne provided a detailed overview of the Bakken Formation and geology of the Williston Basin, and the crude oil produced from the region. Anne’s presentation addressed: 

• What are the facts?
• What is the potential?
• What is the quality?
• Where does it go?

            Geologically, the basin includes a structure comprised of an Upper Shale, Middle Dolomite, and Lower Shale. Within a 15,000 ft sequence of sediments there are 15 primary producing formations. The Bakken Shale, the primary producing formation has low permeability and porosity necessitating hydraulic fracturing for recovery. The U.S. Geological Survey has estimated that the formation contains over 4 billion barrels of technically recoverable crude oil. Since 2002, production has ramped up from less than 1 million barrels per year to approximately 8 million barrels in 2007. Quality of the produced oil varies from formation to formation, but averages about 41°API, with S < 0.2%, and TAN ~0.10. Ni + V are very low. Other characteristics such as total nitrogen and pour point are variable.

 

            Mobius Technologies’ oil sorbent, Brian Hennessey, Mobius Technologies. Mobius developed an oil sorbent composed of polyurethane (MPU) that is highly hydrophobic and oleophilic. Brian discussed its application to spilled oils including crude oil and showed a video produced by his company illustrating its effectiveness. The material has been approved by the Environmental Protection Agency as an oil sorbent and is available in bulk form as a fine powder. 

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This concluded the June 10, 2010 meeting of the COQA.  The next meeting of COQA will be on October 28, 2010, in Houston, TX.