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Managing Technology for Growth and Profitability

Impact of Sustainability and Environmental Factors on Technology Obsolescence

Jeffery C. Bricker Senior Director of Research - Honeywell UOP


Outline of the talk

• Introduction

• Technology Obsolescence

• Non -Technical Factors

• Examples & Experience

• Anticipating Technology Obsolescence

• Conclusions


Non-Technical Factors in Technology Obsolescence

Managing Technology for Growth and Profitability 3

• Sustainability

• Regional Shifts in Resources: Feedstocks, Skilled Labor

• Legislative /Political/ Legal

• Planned Obsolescence

Examples and Learnings


Sustainability

Managing Technology for Growth and Profitability 4

Rhine River 1958


Sustainability: History of Detergent IndustryBranched Detergent Alkylate

•1955-60, Due to poor biodegradation, pollution of lake and river waters from washing effluent raised serious concern

•The Branched structure of the paraffinic chain was identified as the primary cause of poor biodegradation

•Challenge was to make linear olefins in C12 carbon range to replace propylene tetramer as alkylation feed

Managing Technology for Growth and Profitability Managing Technology for Growth and Profitability

Alkyl Benzene Sulfonates Classifies into Groups

Opportunity Emerged for LAB Technology

Branched and linear chain

SO3H

CH3(CH2)6

Ionic surfactants:

Alkyl Benzene sulphonates

LAS: Linear Alkyl Benzene Sulfonate

(Alkyl Chain: C10 – C13)

SO3-Na+

SO3H


Shale Gas Liquids Support Petrochemical Growth

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

2010 2015 2020 2025

BP

SD

, m

illi

on

s

Pentanes+

Butane

Propane

Ethane

0

20,000

40,000

60,000

80,000

100,000

120,000

2004 2006 2008 2010 2012 2014 2016 2018 2020kM

TA

Propylene Gap

Conventional Sources

Demand

Lower Cost Ethane Prompts Shift in Feedstock UsagePropylene Supply/Demand

January 2011 Source: CMAI

Wt-

% P

rod

uc

ed

fro

m F

ee

ds

toc

k

90%

100%

80%

70%

60%

50%

40%

30%

20%

10%

0%2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Ethane Propane Butane Naphtha Gas Oil


Olefin Technologies

Propane

Ethane

NaphthaGas Oil

EthylenePropyleneC4 Olefins,C4

==

PyGas

Propane Dehydrogenation andMTO have “Taken- Off”

PDHPropane Dehydro

Steam CrackingThermal

Propylene

EthylenePropylene

Methane or Coal

MTOMethanol to Olefins

SynGas / MethanolReformer / Converter

Feedstocks Processes Products

Steam CrackingThermal

Ethylene


Legislative / Legal / Sustainability Example

•MARPOL Sulfur Regulations set at 2020 (World Wide)

– + IMO requires Bunker at 0.5 % S (from 3.5% )

– + Fuel Oil is devalued

•Big Impact on Refiners Worldwide

– + Hydrocracking Conversion Refineries Poised

– + Exhaust Gas Scrubbers on Ships

– + Alternate Fuels


Strategies to Capitalize on Obsolescence

•Understand Derivative Impact of World Wide Mega Trends; e.g. connected devices

•Energy Macro Market Analysis (worldwide)

•Organizational Core Strengths

•Cutting Edge Science that can be Employed across Technologies

•Future Scenario Analysis assuming more disruption than the base case

•Conduct Proof of Principle Idea Evaluation of your Big Ideas


What Disrupters Should We Anticipate

•Electric Car (e.g. Tesla) Usage Accelerates

•Potential New Combustion Engine Design

•Direct Natural Gas Conversion to Chemicals

•50 Billion Devices will be connected by 2020

– Impactful

•Sustainability and CO2 minimization

– Green Chemicals

– Renewable Energy & Fuels

– CO2 Capture & Re-use


Renewable Gasoline GHG Emissions

Renewables Sources have a Significant Lower CO2 Footprint

PetroleumDiesel

PyGasoline:LoggingResidue

PyGasoline:Poplar

PyGasoline:Willow

PetroleumGasoline

0

10

20

30

40

50

60

70

80

90

100

Fuel Combustion

Fuel Transportation

Fuel Production

Transportation of Feedstocks

Feedstock Production, RMA

Feedstock Chemicals

g C

O2

eq

./M

J

Preliminary Model Results (Woody Feedstock)

Lifecycle GHG Thresholds in EISA

(% reduction from 2005 baseline)

Renewable fuela 20%

Advanced biofuel 50%

Biomass-based diesel 50%

Cellulosic biofuel 60%


US Renewable Transportation Fuel Market

• 36 B gallons of renewable transportation fuel by 2022

• Supply limitations will prevent refiners from achieving RFS2 targets

– Challenges in overcoming Ethanol blend wall

– Technology availability

– Feedstock availability

• State directives (LCFS) provide additional incentives

US Renewable Fuel Standard (RFS2) Compliance with RFS2

0

5

10

15

20

25

30

35

40

2014 2015 2016 2017 2018 2019 2020

Bil

lio

ns

of

Eth

an

ol E

qu

iv.

GP

Y

Ethanol, corn based Biomass-Based Diesel (BBD)

Cellulosic Biofuel (CB) Advanced (BBD or CB)

IHS Forecast

* Ethanol equivalent based on energy content; for example 1 gallon of green diesel = 1.7 ethanol equivalent gallons

Estimates Targets

Sources: Volumes for 2014 & 2015 from PIRA Jan 2015; Volumes 2016-2020 from EPA

Demand from IHS Dec 2014 update


RTP - Rapid Thermal Processing

Decouples biomass conversion from energy generation

Electricity Production

Upgrade to Transport

Fuels(Gasoline,

Jet & Diesel)

Fuel Oil Substitution

Agricultural Waste

• Transportable fuel

• Energy densification relative to biomass

• Maximum liquid yield 65 – 75 Wt-%RTPUnit

Forest Residue


Forecast: Aviation Industry CO2 Emissions

Low carbon fuels a key part of emissions reduction

Using less fuelEfficient Airplanes

Operational Efficiency

Changing the fuel Sustainable Biofuels

Key Drivers of Emissions Reductions

Carbon Neutral Timeline 2050

CO

2E

mis

sio

ns

Baseline

Low Carbon Fuels


Green Jet Life Cycle Analysis (LCA)

• Green Jet Fuel (Bio-SPK) has equal or higher energy intensity as fossil jet fuel

• Combustion of Bio-SPK does not count towards GHG

– Carbon cycle for plants

• No significant land use changes (LUC)

– Camelina displaces fallow weeds in

crop rotation with wheat

– No food production is displaced by

camelina seed cultivation

• Combustion of Bio-SPK does not count towards GHG

0 50 100

Cultivation

Seed Transport

Oil Extraction and Refining

Oil Transport

Fuel Production

Effluent

Fuel Transport

Green Jet Fuel

Conventional Jet Fuel

g CO2 Eq. / MJ

68% Reduction

Greenhouse Gas (GHG) Intensity

Fossil Fuel

Bio-SPK


Key Properties of Green Jet

Production Viability DemonstratedFuel Samples from Different Sources Meet Key Properties

DescriptionJet A-1 Specs

Jatropha Derived

SPK

Camelina Derived

SPK

Jatropha/ Algae

Derived SPK

Flash Point, oC Min 38 46.5 42.0 41.0

Freezing Point, oC Max -47 -57.0 -63.5 -54.5

JFTOT@300oC

Filter dP, mmHg max 25 0.0 0.0 0.2

Tube Deposit Less Than < 3 1.0 <1 1.0

Net heat of combustion, MJ/kg min 42.8 44.3 44.0 44.2

Viscosity, -20 deg C, mm2/sec max 8.0 3.66 3.33 3.51

Sulfur, ppm max 3000 <0.0 <0.0 <0.0

Over 6000 US Gallons of bio-SPK made

UOP Green Jet


The AltAir Renewable Jet Fuel Project

Technology: UOP Renewable Jet Fuel Process

Product: Green Jet Fuel

Location: Los Angeles, CA

Specifics:

Deoxygenation

Reactor

Hydrocracking &

Isomerization

Reactor

Product

Separation

Vegetable Oils,

Animal Fats

& Greases

Feedstocks Acid Gas

(to treating)

Water

(to treating)

Green Jet

Green Diesel

Light Fuels

Hydrogen

2014 Start-up – Very successful Operation

United Airlines utilizes AltAir lower-carbon, renewable jet fuel on Flights Today

1st full-scale plant dedicated renewable jet fuel for commercial use


Approaches for CO2 Utilization

Reductant Reaction Pathway

I. Hydrogen Reverse WGS + Chemical Synthesis

CO2 + H2 CO + H2O

syn-gas chemicals or F-T fuels

Methanation

II. CH4 Dry ReformingWGS Fuels/Chemicals

CH4 + CO2 2H2 + 2 CO

Dry gasification of coal

III. Electrical Power Direct electrochemical reduction

CO2 + e- CO or H2CO

IV. Solar Visible (400-700 nm) Pathways

1. Solar photochemical (direct CO2)

2. Solar Biological (Algae)

3. Solar H2 (water splitting)

Doable but Expensive

High Potential-needs catalytic process

Very Long Range R&D


Summary for Discussion

• Market and Non-Technical Factors will continue to be Disruptive to the Energy, Refinery and Chemical Industries

• This always creates Technology Opportunities for those Organizations that are ready

• Strategic Planning to Cover Alternative Scenarios is Important

– If the Planning is done in a way that is supported by Technology Platforms important to the company, best case scenario


Thank youwww.gpca.org.ae

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