LOTOS gets go-ahead to build DCU under EFRA Project
Date: 14.03.2016

LOTOS gets go-ahead to build DCU under EFRA Project

The LOTOS Group may start construction of a Delayed Coking Unit (DCU) and Coker Naphtha Hydrotreating Unit (CNHT), key elements of the EFRA Project designed to increase the efficiency of the Gdańsk refinery. The relevant permit was issued by the Municipal Office of Gdańsk on March 7th. Site preparation for the DCU should start in late March or early April. The permitting process for the EFRA Project is progressing as planned.

To meet the project schedule and cost regime, all supporting documentation had to be filed sufficiently in advance, in some cases even several years before construction work. For example, the project information sheet, the first formal application concerning the DCU, attesting that the new units will not have a negative environmental impact was submitted with the Municipal Office of Gdańsk back in July 2013. Next in line was the Environmental Impact Assessment, which was the basis for the issue of a positive Environmental Decision covering the cumulative environmental impact of existing and future units of the refinery. The building permit documents for three units under the EFRA Project, contained in roughly 40 binders, were filed with the Municipal Office of Gdańsk on January 15th 2016. The local authorities issued a building permit for the Hydrogen Generation Unit (HGU) on February 24th and for the other two units DCU and CHNT on March 7th.

Since EFRA is a joint project between Grupa LOTOS and LOTOS Asfalt, building permit applications were filed on behalf of both companies. This simplified application path is now possible under new regulations introduced at the beginning of this year.

The permits for two key installations envisaged under EFRA are crucial for the project execution this year and beyond. As planned, we now enter the next phase of the project’s complex work programme. The entire EFRA Project and its segments are strictly and precisely intertwined. Now, with permits to build the DCU and CHNT in hand, we can automatically progress to successive activity areas. We are very pleased that the design and permitting process is going smoothly − says Grzegorz Błędowski, EFRA Project Director.

Each step in the process of preparing documents and certificates requires due diligence and accuracy, not only in terms of their timely delivery, but also their quality. It was a painstaking and lengthy task. On top of a representation on holding land property rights to the construction site, mutual authorisations between LOTOS and LOTOS Asfalt to conduct work on their respective plots, it also required other special certificates and appendices. For example, the DCU, as a structure taller than 50 metres, required approval from the Headquarters of the Polish Armed Forces. To prepare the documentation, the company also turned to external specialists and experts.

We cannot risk any mistakes. That is why, to review and develop designs, we decided to engage experts from all fields across Grupa LOTOS and LOTOS Asfalt. On LOTOS’ side only, the designs were reviewed by 20 persons. The pressure is immense, as issues with securing permits only arise when there are flaws in the design or application. In such instances, you only have 7 days to remedy them, failing which you have to start the whole process from scratch. That’s why we always make sure that everything goes as planned − explains Tadeusz Wróbel, Head of the Grupa LOTOS Trades and Technical Team.

The permits obtained to date are less than half of what is required for the EFRA Project. Only the construction and modernisation pipeline trestles required four permits. The important thing is that LOTOS has already secured permits for all major units under the EFRA Project. A lion’s share of permits is required for projects supervised by banks financing the Project. These banks require that their technical advisors receive the English text of building permits within two weeks of their becoming final. Following completion of the EFRA Project, one of many challenges facing LOTOS engineers will be to obtain an integrated permit for the refinery’s new configuration and draft a safety report.

The Delayed Coking Unit is the main unit of the EFRA Project. It will have an hourly capacity of 160 tonnes of feedstock comprising vacuum residue, SDA bitumen (derived from the ROSE unit), PDA bitumen as well as furfural extracts and slop oil. The DCU will process approximately 1.4m tonnes of feedstock annually. This feedstock will be heated in a heat exchange train, then fed to a distillation column and pumped through a furnace to a large coke drum. In the coke drum, the feedstock will be subject to deep thermal cracking with separation of coke. The coking process will take place alternately in two such coke drums. While one cracks feedstock, the other is taken offline to cool-down, cut and remove coke. The cracking process takes place inside the drum, at a temperature of approximately 500°C. Cracking involves breaking down of long chains of hydrocarbons to create molecules with a lower gram-molecular weight, which is characteristic of fuels. The heaviest hydrocarbons are transformed into the final market product − coke.

The purpose of the CNHT is to treat the gasoline fraction. This fraction, contaminated with sulphur, nitrogen and olefins, is directed from the distillation column of the DCU to the nearby CHNT unit where it is hydrotreated using hydrogen. Next, as naphta it is routed to tanks, transferred over a pipeline to the port and shipped to customers.

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The total cost of the deep oil conversion complex built under the EFRA (Effective Refining) Project is approximately PLN 2.3bn. When completed, the complex will increase the distillate yields at Grupa LOTOS and, as a consequence, will boost its refining margin by approximately USD 2/bbl. The EFRA units are expected to add up to 900,000 tonnes to the LOTOS refinery’s annual fuel output. The project works are scheduled to end in 2018.

Communications Office, Grupa LOTOS S.A., ul. Elbląska 135, 80-718 Gdańsk, Poland, tel. (+48) 58 308 87 31, (+48) 58 308 83 88, e-mail: media@grupalotos.pl 

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