Feedstocks, fluctuations, and the future of FCC. Exclusive insights from Dr. Tie-Pan Shi, Technical Director, HCpect

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What has been the major change in the FCC market that you have seen recently? How do you think the pandemic has impacted the FCC market?

Since the second quarter, gasoline demand destruction played a huge part in the under-utilization of FCC units across the globe. Some units or even refineries were shut down temporarily or permanently due to this shockwave. FCC units have been forced to cut rates, and/or change its mode of operation to favor diesel production. Petrochemical production, especially lower olefins, had seen a surge in some markets though. FCC market, and to most extent the refining businesses are lethargic and can’t wait for the pending market recovery when COVID-19 is under control.

What are the major challenges facing the FCC market?

The major challenge is the versatility of the FCC units to cater to the market. Most units can run at lower rates but may face difficulty at below 60%. When the FCC unit is properly configured, maintained, operated, and optimized, it can increase the production of propylene, ethylene, aromatics, diesel fuels at reduced gasoline rates during this episode.

How can FCC operators adapt to fluctuations and inconsistencies in feedstock supply?

Most FCC operators can adapt to feedstock supply changes as it almost happens routinely for refineries. When a paradigm scale of shift occurs to the FCC feed such as in metal contents, FCC operators can seek help from catalyst suppliers for catalyst reformulation or additives to handle the metal poisoning problems.

What separates the world’s best FCC operators from the rest? What are the qualities of a “best-in-class” FCC operator, and how can FCC operators differentiate in the increasingly competitive market?

The best FCC operators have the resources, experiences, and adaptability to play an instrumental role in the refinery. The sensitivity to data and operation is critical. Before internet-of-things became catchy, FCC units and refineries were already highly digitized operations.  When the operator has a higher degree of freedom in operating the unit at the edges with calculated risk and correct approach, the unit will have the best chance to reach its potential. Optimization modeling can be exercised more frequently to handle changing markets. The understanding of the catalyst, as well as the willingness to work with catalyst suppliers is also critical in optimising and troubleshooting FCC units. For example, catalyst suppliers would be ready to offer help to meet higher propylene demand and the shift in diesel/gasoline ratio.

Are there any regions you would describe as “leaders” in the FCC market? How do Asian markets compare with other global regions?

Asia is leading in new refinery projects and new FCC unit constructions due to projected demand growth. New crude-to-chemicals plants are being built, and new refineries are built with strong focus on chemical platforms. New refinery projects have a tendency to favor hydroprocessing technologies rather than FCC in fuel upgrading. Those two trends actually do not help much with new FCC installations. With a strong governmental initiative in China, new mega refineries with improved efficiency and competitiveness are being built to displace old and segregated facilities. India, on the other hand, is projecting a 70% increase in FCC catalyst consumption in five years. Also, Asia recovered quicker from the pandemic and was less impacted than other regions this year.

How is the growing demand for petrochemicals affecting the fluid catalytic cracking sector?

Propylene demand has been stronger compared to transportation fuels, as with aromatics. Particular to FCC, operational shifts and catalytic approaches will help with this transition. Without drastic transition or revamp to deep or high severity cracking, operational and catalytic changes can increase propylene yield from 5 to 10 wt% or greater. Aromatics unit installation is also becoming popular in some regions.