By John Kemp
LONDON, May 20 (Reuters) - Petroleum coke piled up along the banks of the Detroit River has sparked a storm of protest from local residents and environmental campaigners, who claim they are just one more problem associated with the bituminous tar sands being mined in western Canada.
“A black mound of Canadian oil waste is rising over Detroit,” the New York Times scolded in an article published on Friday.
“Detroit’s ever-growing black mountain is the unloved, unwanted and long overlooked by-product of Canada’s oil sands boom,” the Times explained. “No one quite knows what to do about it, except Koch Carbon, which owns it.”
The three-story pile of petroleum coke covers an entire city block on the other side of the river, according to the Times.
The implication is that tar sands oil is uniquely dirty: without it the residents of the U.S. city of Detroit, and neighbouring Windsor across the border in Canada, might be spared an eyesore some fear could also pose health risks.
However, it is misleading to blame the coke mountain along the Detroit River on Canada’s oil sands as if they were uniquely problematic.
No one is likely to welcome a stockpile of petroleum coke stored at the bottom of their street because it doesn’t look very pretty. But if there is a problem, the solution is tougher zoning regulations, not trying to blame oil sands production.
Campaigners portray the coke as a useless waste product which is being stored along the banks of the Detroit River because no one knows what to do with it.
“Canada has 79.8 million tons stockpiled,” says the Times. “Some is dumped in open-pit oil sands mines and tailing ponds in Alberta. Much is just piled up there.”
“Detroit’s pile will not be the only one. Canada’s efforts to sell more products derived from oil sands to the United States, which include transporting it through the proposed Keystone XL pipeline, have pulled more coking south to American refineries, creating more waste product there,” the Times adds.
In fact, the production of petroleum coke is an inevitable part of the refining process for all medium and heavy types of crude, and there is a healthy market for it as fuel.
Petroleum coke accounts for around 5 percent of all refinery output in the United States. The percentage has been fairly stable for the past 20 years, creeping slowly higher, according to data published by the U.S. Energy Information Administration (EIA).
In 2012, U.S. refineries produced almost 850,000 barrels equivalent of pet coke every day, according to EIA. One metric tonne of petroleum coke is roughly 5.5 barrels.
Around 350,000 barrels per day was supplied to plants in the United States. Most of it is low-quality green coke, used in cement kilns, or mixed with coal and burned in power plants. Small quantities of high-quality needle coke are used to make anodes for electric arc furnaces used in steelmaking.
Another 500,000 barrels per day was exported, according to EIA, mostly to China (72,000 barrels per day), Japan (57,000 bpd), Mexico, (47,000 bpd) India (35,000 bpd), Brazil (33,000 bpd), Canada (28,000 bpd) and Italy (25,000 bpd).
Coke exports have doubled since 1993.
Coke production allows refineries to handle a wider range of crudes more efficiently.
The basic process in a refinery is to distil crude into separate components with different boiling points ranging from gasoline and naphtha to kerosene and gas oil.
Distilling light crudes such as Brent and West Texas Intermediate (WTI) which contain mostly low-boiling components is fairly easy. Medium and heavy crudes have a much higher proportion of components that only boil at very high temperatures, which makes them harder to handle.
If crude is heated to more than about 900 degrees, the larger molecules begin to crack apart. Cracking produces some extra light molecules in the gasoline and diesel range, which is useful, but it also leaves behind carbon residues that can clog up refinery stills and pipes.
To avoid clogging up the stills, refineries used to leave a large quantity of residual fuel oil, which would not boil except above 800 degrees, essentially unrefined, and sold it at a discount to ships and power plants for boiler fuel.
Even so, distillation units and other parts of oil refineries had to be periodically de-coked to remove the carbon residues that had built up, which was a dirty and expensive process.
Most state of the art refineries now employ delayed coking units which control the cracking process. Heavy liquids left over from atmospheric or vacuum distillation are heated to 1,000 degrees or more and sent to a special coking drum, where the residual oil cracks (“Refining process handbook” 2003).
Light boiling point molecules are split off and sent for gasoline and diesel blending. The heavy coke accumulates on the inside of the drum. When the drum is full, it is switched over and an empty one is used. The petroleum coke is then cut from the full drum using high pressure water jets.
Most refineries have two coking drums. It takes around 24 hours for a drum to fill. Switching, cooling and decoking and emptying a drum takes about 22 hours, during which time the other drum is filling (“Petroleum refining: a non-technical guide” 2008).
U.S. oil refineries have invested heavily in coking. Between 1992 and 2012, U.S. refiners boosted the capacity of their coking units by almost 50 percent from 1.46 million barrels per day to 2.18 million barrels per day.
Cokers allow refiners to buy heavier crudes, which trade at a discount, and squeeze a greater proportion of valuable light products from them, like gasoline and diesel, which they can sell at a premium. Coking therefore transforms refinery economics.
Campaigners note that petroleum coke produces a lot of carbon dioxide when burned. But so does residual fuel oil (RFO). Petroleum coke is displacing the dirty RFO once burned in power stations and ships. By separating out more gasoline and diesel, coking can boost the efficiency of the combustion process overall.
DON‘T BLAME TAR SANDS
Canada’s oil sands are often singled out because they contain a high proportion of high-boiling point molecules and therefore leave behind a lot of coke. But they are not the only crudes which produce a lot of coke.
Much of California’s crude is very heavy. West Coast oil refiners accounted for 9 percent of the country’s refinery production but 18 percent of its coke output in 2012.
Venezuela and Saudi Arabia are also big producers of heavy crude. All medium and heavy crudes will produce coke to some extent.
U.S. refiners will continue to produce a lot of petroleum coke whether or not the Keystone pipeline is eventually approved.
In an ironic twist, most of the crude which is being produced from North Dakota’s Bakken and other shale formations is much lighter, so it will produce less coke.
But having invested heavily in coking capacity, refineries have a strong financial incentive to continue purchasing discount heavy crudes from overseas and upgrade them as much as possible.