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Can you comment on the shift in FCC product economics beyond 2025?

Jul-2024

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Rainer Albert Rakoczy, Clariant Catalysts,

Rainer Albert Rakoczy, Technology Advisor Fuels, Clariant Catalysts
The original purpose of the FCC process and an FCC refinery was to focus on the production of high knock-resistant gasoline. Due to the energy transition, individual transportation by passenger cars will be fully electric-driven or plug-in hybrid cars. Additionally, so-called fleet effects by having more vehicles with lower consumption on the road, as older cars get substituted by the latest high mileage achieving models. With this shift, the overall gasoline market will shrink.

Rainer Albert RakoczyRefiners will, therefore, need to focus on lighter products, which are mostly light olefins, and the inclusion of the potential to condition cracker naphtha towards steam cracker feedstocks (fuel to chemicals). Enhancing light products can be achieved by reformulation of the applied FCC catalyst cocktail as an interim solution, However, sooner or later, the addition of a second riser reactor is much more efficient. To streamline cracker naphtha cuts as a steam cracker feed, a variety of catalysts can be offered from Clariant’s proprietary HDMax Series to saturate olefins and aromatics and even open the cyclic compounds.

HDMax is a mark of Clariant Catalysts.

Jul-2024
Corbett Senter, BASF Refinery Catalyst, james.senter@basf.com

In the last few years, fluid catalytic cracking (FCC) economics have been very favourable, Tightness in the transportation fuels markets has led to a strong incentive (margins) for producing these products. This was more than enough to offset weaker propylene margins, as the supply of propylene exceeded the expected demand in the market.

The years beyond 2025 could lead to a shift in the market in a couple of significant ways. In North America and Europe, it is believed that gasoline and diesel demand (often >70% of the product produced by an FCC) has already or will soon peak. This is based on predictions of higher amounts of electric vehicle (EV) penetration in these regions.

Steps such as the Inflation Reduction Act in the US and adherence to the EU Commission’s proposed Fit for 55/RED III targets have shown that leadership in these areas remains committed to meeting CO2 reduction targets despite energy security concerns, which arose in 2022. Other parts of the world – Asia, the Middle East, Africa, and Latin America – show a more favourable growth outlook for these transportation fuels, which will provide upward pressure on global demand.

A few key questions which should be asked in the next few years are:
υ Will EV growth keep up with projections? Growth continues to be positive, but supply chain disruptions and dependence on tax incentives in some areas have raised some doubts that previously did not exist.

ϖ Can co-processing of alternative feeds emerge as a sustainable (financially and environmentally) method of reducing the CO₂ footprint of products made from FCC? This would allow internal combustion engines (ICE) more of a place in a world with increased emissions legislation.
ω When will viable refined product from new FCCs reach the market? Multiple FCC startups are expected soon, which will increase refined product supply in the global market and decrease margins for FCCs globally.
ξ Can hybrids emerge as a viable solution to compete with battery-only EVs? These offer reduced emissions with lighter batteries and will not be completely reliant on a charging network.

While many questions exist regarding future FCC economics, FCCs are better positioned than other processes due to their flexibility. Pairing the proper operation and configuration with the correct catalyst strategy will allow FCCs to meet a variety of product targets. For example, FCCs which wish to maximise gasoline production could use a catalyst designed for high conversion to gasoline (such as BASF Luminate) or a catalyst that utilises multiple zeolite frameworks to maximise alkylation unit feed production (such as BASF Fourte or Fourtune).

Alternatively, an FCC which has a goal to maximise lighter olefin production, such as propylene, can utilise olefin production additives in combination with a base catalyst. This can generate the precursors needed to perform effectively with the additive (such as BASF MPS). An FCC unit is also flexible in that it can handle feeds of different qualities, and flexibility also exists within FCC catalyst technologies. There are specific solutions that can deal with common FCC feed contaminants, such as nickel (BASF Boron Based Technology) and vanadium (BASF Valor).

Everyone in the industry is clearly concerned about the future of FCC economics. However, there is reason for optimism, as the flexibility of the process provides an opportunity for FCCs to adapt to whatever lies ahead.

Luminate, Fourte, Fourtune, MPS, and Valor are marks of BASF.

Jul-2024