The refining activities of Petrogal are carried out in its Sines and Porto refineries, which have a combined capacity for distilling 15.2 million tons of crude oil per year. In 1998 these refineries provided about 86% of all oil products consumed in Portugal. It was decided in 1998 that to remain competitive both refineries would require extensive upgrades.
The refining business has been struggling with poor profitability since the beginning of the 1990s. This is not unique to Portugal, or to Petrogal. Refiners around the world have been examining ways to increase margins. For the Portuguese plants in particular, margins associated with primary atmospheric distillation have been low, while margins from conversion processes have not generated enough funds to cover the investments required to comply with increasingly demanding environmental regulations.
Tasks connected with a study on the integrated redesign of the refining system were completed in 1998. This redesign process began with two construction projects, a splitter of reformate to reduce benzene in gasoline and a tatoray unit aimed to produce xylenes and benzene from heavy aromatics and toluene.
As a result of this study, the company announced its intention to invest heavily in its industrial units to 2002, with a view to securing compliance with the environmental specifications on gasoline and diesel engine fuel quality imposed by the EU Directive. This investment also aims to accommodate the changes of product demand, especially those resulting from the increasing shift to diesel of the Portuguese automobile fleet and the profile of crude oil supply.
PORTO REFINERY PLANT UPGRADE
As part of the plant upgrade Foster Wheeler Corporation were granted a $16 million contract for their platformate splitting project at the Porto Refinery. Foster Wheeler France, S.A. was responsible for the engineering, procurement, management and construction of the project, which began in March 1999 and was completed by the end of 1999.
The project produced platformate, a component of the gasoline pool with a benzene content of 1.0% volume maximum. Foster Wheeler provided a platformate splitter with three side cuts, an overhead light platformate, a heart cut rich in benzene, and the last cut of heavy platformate.
The combined light platformate and heavy platformate had a benzene content of less than 1.0% volume. The heart cut had a benzene content of around 40-50% of the weight and was used as feedstock to the benzene toluene extraction arosolvan unit of the Porto Aromatic Complex.
As a further partial plant upgrading, Technip, the French contractor, was awarded two contracts for the revamping of three hydrodesulfurization units, two units at Sines and one at Porto which will allow Petrogal to produce gas oil that meets the new standards of sulphur emissions set by the EU. This deal was signed in May 2000.
Total investment for the Technip projects was estimated at about $18 million. Under the terms of the contracts, Technip was responsible for basic and detailed engineering, procurement, construction supervision and assistance to start-up.
Work on the Porto unit, which included the installation of a new reactor, was completed in December 1999. Technip in Paris and Lusotecna, Technip’s Lisbon-based affiliate handled engineering services for both projects.
Petróleos de Portugal was originally a state owned company. The company was privatised, although the Portuguese government retained a stake.