Distillation is bubbling up

High capacity utilization is prompting significant efforts to optimize column performance

By Seán Ottewell

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Properly install column internals
Hopes that fallout from the subprime lending fiasco would mainly impact the U.S. and Western European economies seem largely misplaced now as its malaise spreads ever wider around the globe. The ongoing tribulations of the world economy are making even the modest growth predictions made late last year by the American Chemistry Council (ACC), Arlington, Va., seem quite optimistic. ACC did warn, though, that ongoing financial problems and an oil price shock could take a toll.

Other problems are emerging, too. Even before subprime problem surfaced, China was always going to be the economic driving force for global development over the next few years. Now, however, that country is suffering its worst winter in decades. Food costs have climbed 18% as a result of snow-related supply problems. Inflation has hit an 11-year high in January, an annualized 7.1% — up by more than ½% compared to the previous month.

Source: Invensys Process Systems.

On the other hand, however, a low dollar is good for U.S. exports, particularly if overseas growth remains robust. If this is the case, last year’s $154 billion export figure could rise to $169 billion this year and $180 billion in 2009, says ACC.

Latest data from ACC show shipments of chemicals rising and capacity utilization hovering just below 80%. So, continuing strong demand for exports should edge U.S. capacity utilization to 80% in 2008.

It’s not just the mainstream chemical producers that are enjoying high capacity utilization. In August, the American Petroleum Institute (API), Washington, D.C., reported 90.8% refinery utilization rates, the highest level since September 2006. Production of gasoline hit 9.325 million bbl/d, another new record. By November, refinery activity was the highest in three years.

API’s annual statistical report published in late January noted that overall capacity utilization averaged 88.1% for all of 2007, up slightly from a year before.

Meanwhile, the International Energy Agency (IAE), Vienna, Austria, predicts that global refinery crude runs will average 74.3 million bbl/d for the first quarter of 2008, a year-on-year increase of 1 million bbl/d.

While it remains to be seen how much further damage the subprime fiasco can do to the world economy — there are rumors of major investments in the Far East being postponed by many years — high capacity utilization is spurring companies to place even more emphasis on asset optimization. And, because at many plants, distillation plays a crucial role, demand for mass transfer products and services is booming. Operating companies are looking to gain improvements through everything from better packings and trays to improved control systems and simulators.

“The biggest trend at the moment is the massive number of projects. There’s a huge uptake after the lull in the late 1990s,” says Gary Sturtevant, industry segment leader in UOP’s Refining Business Unit, Des Plaines, Ill. UOP also is building up a healthy stream of business for its new Ecofining technology. This converts raw materials such as vegetable oils into biodiesel. “The challenge here is that we are not dealing with traditional hydrocarbon feedstocks, so we are having to do a lot of development work associated with their [the biofeedstocks] handling and processing,” he notes.

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