Prices naphtha

In Europe. With either premium or fuel by-product prices prevailing, naphtha is very marginally the preferred feedstock. Heavy gas oil appears to be an interesting feed possibility at current price levels. Although the ethylene production cost with this feed is slightly higher than with naphtha, the difference is so small that it could be wiped out by a naphtha price increase of less than 0.1 /lb. 

Europe. The demand for naphtha for petrochemical feed purposes in Europe continues to rise strongly. As a result, the prices for this commodity have risen over the past several years. Increased use of light North African crudes, providing a higher proportion of gasoline and potential petrochemical naphtha, has retarded but not stopped the rise in naphtha prices. 

It would be foolhardy to attempt to predict definitively the level of naphtha prices at some particular future date. However, additional... 

From this display it can be seen that a 0.1 /lb increase in naphtha price from 1.0 to 1.1 / lb would raise the ethylene production cost from 2.5 to 2.8 /lb. If such a movement did occur, heavy gas oil at current 0.75 /lb levels (based on equivalent heavy fuel oil adjusted for viscosity considerations and vacuum distillation costs) would become competitive with naphtha. 

The breakeven price defines the unit price one could afford to pay for the gas oil to realize the same ethylene production cost as for a naphtha feed. If for a given naphtha price, the gas oil can be obtained at a price below the indicated gas oil breakeven price, gas oil would be the more attractive feed. If the gas oil can only be obtained at a price above the breakeven, naphtha would be the desired feed. Thus, with naphtha at, say, 1 /lb, the heavy gas oil would have to be priced below 0.7 /lb to be more profitable than naphtha as a cracking feed, assuming premium by-products prevail. Valuing the by-products as fuel has only a slight effect on the breakeven levels. The curves cross as nonaromatics in the pyrolysis gasoline have been valued the same as naphtha feed. 

Thus, at today s naphtha prices and by-product markets, pyrolysis of light vacuum gas oil appears closely competitive with naphtha for ethylene production. 

Much controversy has existed regarding the price at which foreign naphtha could be delivered in the U.S. and the question of whether foreign naphtha would be indeed available. Estimates of prices applicable on the Gulf Coast have ranged from about 5.3 to over 7.1 /gal (0.85 /lb to over 1.14 /lb) (8). It is beyond the scope of this presentation to attempt to render judgment on the availability/price relationship that would result at a given world demand level. However, for purposes of illustration, let us look at what, say, a 1.1 /lb naphtha price would mean in the United States. 

Figure 6 shows that with the present level of premium valuation for by-products, a 1.1 /lb naphtha price would result in this feedstock having an advantage over ethane, propane or butane at 1 /lb. The cost for naphtha-based ethylene in this case would be only 1.94 /lb vs. 2.04, 2.36, and 2.47 /lb from n-butane, propane, and ethane, respectively. The breakeven prices for the light feedstocks that would correspond to the 1.1 /lb naphtha price would be 0.6, 0.82, and 0.95 /lb for ethane, pro-... 

Under the assumptions of naphtha price and aromatics value stated above, naphtha pyrolysis clearly would be superior to light hydrocarbon pyrolysis at their current feed prices. A similar analysis can probably be made also for gas oil. Thus, if the possible developments discussed above do materialize, the heavier feeds could probably dominate almost all new U.S. ethylene plant construction in the future. 

WEEK FROM JAN 01 1988 Figure 5.1 Olefin and naphtha price trends... 

Naphtha prices were based on actual prices of oil and naphtha imported rather than on a formula. 

Figure 5. Crude/naphtha price relationship for equal ethylene manufacturing...

Traditionally, the imported naphtha price was linked with the crude price, and was considered as crude price plus l /bbl. However, recently the price margin has become as much as 4 to 6S/bbl due to the increasing demand, especially, in the Asian regions. 

When naphtha prices were high, there was considerable activity on developing and piloting improved partial combustion processes for heavier oil fractions and coal (especially in Germany and the U.S.A.). But with lower efficiencies, the need for expensive gas purification and the handling problems of coal and residual ash, the work has lost impetus for the time being. 

Fig. 2. Quarterly olefin feedstock prices, 1978—1991, for (D) ethane (+) propane (<)) light naphtha, and (A) naphtha.

Fig. 3. Price ratio of various feeds to ethane, 1978—1991 (D) propane—ethane, (+) light naphtha—ethane, and (<)) fuU-range naphtha—ethane.

Naphtha at one time was a more popular feed, and alkah-promoted catalysts were developed specifically for use with it. As of 1994 the price of naphtha in most Western countries is too high for a reformer feed, and natural gas represents the best economical feedstock. However, where natural gas is not available, propane, butane, or naphtha is preferentially selected over fuel oil or coal. 

In the late 1960s the biggest incentives were available in Puerto Rico. As a result, petrochemical investments in Puerto Rico may exceed 1,500,000,000 by 1975. The major baits were tax exemptions and free ports. Companies making products not produced in Puerto Rico previous to 1947 (true for nearly any chemical) could be granted 100% income tax exemptions for up to 17 years. They were also allowed to avoid the import duties on certain raw materials. For instance, in 1970 (naphtha), an important feedstock for producing petrochemicals, could be obtained on the world market at half its selling price in the United States.3,14... 

Propylene, a light olefin, is like ethylene one of the most important feedstocks for the petrochemical industry. In recent years the main way to obtain propylene and ethylene has been via cracking of naphtha. For this reason the cost of the corresponding polymers, mainly polypropylene and polyethylene, depends on the international oil price. One big challenge for modem chemistry is to look for an alternative production of feedstocks that is independent of the oil-industry. 

Cracking large hydrocarbons usually results in olefins, molecules with double bonds. Thats why the refinery cat crackers and thermal crackers are sources of ethylene and propylene. But the largest source is olefin plants where ethylene and propylene are the primary products of cracking one or more of the following ethane, propane, butane, naphtha, or gas oil. The choice of feedstock depends both on the olefins plant design and the market price of the feeds. 

Propylene is manufactured by steam cracking of hydrocarbons as discussed under ethylene. The best feedstocks are propane, naphtha, or gas oil, depending on price and availability. About 50-75% of the propylene is consumed by the petroleum refining industry for alkylation and polymerization of propylene to oligomers that are added to gasoline. A smaller amount is made by steam cracking to give pure propylene for chemical manufacture. 

More toluene is formed than is needed in the catalytic reforming of naphtha. Benzene is always in tight supply. Table 8.7 shows the catalytic reformate production percentages of benzene, toluene, and xylene vs. the U.S. chemical demand. When the price is right it is economical to hydrodealkylate (add hydrogen, lose the methyl) toluene to benzene. This is best done on pure toluene, where the yield can be as high as 98.5%. The reaction can be promoted thermally or catalytically. As much as 30-50% of all benzene is made this way. 

In setting the prices for the premium cases, we have incorporated a sliding price scale on some by-products hence, a range of prices appears in some rows of Table V. These price variations reflect differences in the composition of a particular by-product which result from cracking different feedstocks. By way of example, the aromatics content of a pyrolysis naphtha depends on the specific feedstock from which it is derived. The premium price of the particular pyrolysis naphtha thus depends on its BTX concentration. The nonaromatic content of the pyrolysis naphtha is valued the same as naphtha. Further details can be found in Table VI. 

At current price levels, heavier feeds in the United States are not competitive with light hydrocarbon feeds. With U.S. naphtha at 1.6 /lb (10 /gal), the ethylene production costs from this feed ranges about 40-70% higher than costs associated with lighter feeds, assuming premium by-product values. The differences are even greater with fuel byproduct values prevailing. 

Installation of more conversion equipment both in new refinery construction and as additions to existing hydroskimming facilities is already a trend. The production of more naphtha by providing new conversion units would, of course, make the additional naphtha more costly. In this connection a number of studies both our own and others (4) have attempted to determine the cost of incremental naphtha production. These indicate that in typically sized European hydroskimming refinery (operating on either Libyan or Arabian crudes) gasoline plus petrochemical naphtha yields can be increased by about 50% by installation of catalytic cracking. Based on today s prices for the other refinery products, the cost... 

Figure 3 presents the effect of feed price on ethylene production costs in a billion lb/yr European plant for naphtha, light gas oil, and heavy gas oil feedstocks based on premium by-product valuations. 

The breakeven curve for light (atomospheric) gas oil is given in Figure 5. If light gas oil can be disposed of at prevailing middle distillate prices of about 1.1 /lb, naphtha would have to sell at 1.4 to 1.5 /lb for the gas oil to become attractive. Therefore, pyrolysis of atmospheric gas oil will not be ordinarily attractive. 

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