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Preem seeks permits for coker at Swedish refinery
Uchenna Izundu
International Editor
LONDON, Feb. 19, 2008 — Swedish refiner Preem Petroleum AB is seeking envrionmental permits to build a new 4 million tonnes/year coker unit near its 220,000 b/d Lysekil reinery on Sweden’s west coast.
The expansion will propel the company’s move from fuel oil into transportation fuels, according to Michael Low, Preem president and chief executive, who spoke at International Petroleum Week in London. Preem hopes to make a final investment decision on the project by yearend, although if the project proves uneconomical, the company will examine other options. Low declined to comment on what these other options would be, however.
The coker would have high feedstock flexibility and utilize spare hydotreating capacity. Low said it was unclear how much it would cost, but high costs, exacerbated by a shortage of contractors and materials, are impacting upon timely delivery of projects and whether refiners should progress with upgrades.
“Supply bottlenecks faced by the refining sector will not go away until at least 2009-10,” Low said.
However, tightening environmental standards are also increasing costs and workloads for companies in the petroleum sector to ensure they produce cleaner fuels. Utilizing a coker unit would produce more carbon emissions and Preem is investigating methods of carbon capture and sequestration with research insitutions.
Europe’s surplus of gasoline in the near future will be a major challenge as it has lost an export market to the US where the preference is to use diesel run cars instead. Attractive incentives have also encouraged a boost in diesel production. “The car industry needs to come up with ways to make efficient gasoline cars; it’s not a problem that we can solve by ourselves,” Low said.
Low was also doubtful that the European Union will reach its target of having 5.75% of its transportation fuels coming from renewable sources by 2010 as members are at different levels in boosting their share of alternative fuels in the energy mix. “In Germany the government stopped subsidizing grapeseed oil and that has left many companies bankrupt,” Low said.
Contact Uchenna Izundu at uchennai@pennwell.com.
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Just off OGJ press – News about Preem seeking permits and looking at New Coker at Sweedish Refinery. This sounds to be still in the planning stage & will still need approval / economics & FEED stages yet.
It would be a great place to do coker, not sure it will have manpower problems other regions would! Ha
I think this is example of beginning of pressure building for EU cracking refineries to start dealing with high sulfur resid , it cannot sell now due to 1.5% cap on marnine fuel / bunkers without using lots of it’s highest demad and valued product = diesel that it needs for driving demands?
Regards -
AnonymousWho is doing this job ?
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RE: Guest Question – Who is doing this job?
Why don’t you find out & post it for us?? I haven’t seen any updates in April-July time frame that quote anything more than what was in the Feb 2008 news release.
The project is waiting on both regulatory approval & permits for coker – so it is likely they want to get one or both of those before moving from planning into FEED or EPC stage. Don’t think this will have problems with finance – Preem is Saudi owned (Preem is owned by Sheikh Mohammed H Al-Amoudi, an Ethiopian-born Saudi national who is Swedens largest private investor) and they already completed aseparate ~ 340 million investment at Lysekil upgrading in 2006 and just before Preem purchased Norsk Hydro’s 25% share Scranraff/Lysekil Refinery in Sept 2003, Preem invested ~3.3 billion SEK in an Iso-cracker to convert fuel oil for low sulfur fuels.
I understand that Foster Wheeler did Feasibility study on coker (see their Annual report Winter 2005/2006 – has spot on Preem Lysekil/Scranraff Refinery Coker study) so I would expect they have good shot at doing the Coker Technology License on it. Perhaps you could start with them.
Regards
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