Challenges in Distribution of ULSDObservations From Colonial Pipeline ULSD Test

Challenges in Distribution of ULSDObservations From Colonial Pipeline ULSD Test

Colonial Pipeline CompanyBuster Brown

January 26, 2005

Colonial Pipeline CompanyBuster Brown

January 26, 2005

2

TopicsTopics

• Colonial overview

• Highway and Non-Road sulfur specification

• Observations from ULSD test

• Potential pipeline issues

• Colonial overview

• Highway and Non-Road sulfur specification

• Observations from ULSD test

• Potential pipeline issues

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Colonial Pipeline ProfileColonial Pipeline Profile

• 5,519 mile system from Houston to New York Harbor; operating since 1963

• Delivers more than 2.2 million bpd petroleum products from approximately 30 refineries to more than 250 terminals

• 20 percent of all U.S. liquid product delivered by pipeline are handled by Colonial

• 5,519 mile system from Houston to New York Harbor; operating since 1963

• Delivers more than 2.2 million bpd petroleum products from approximately 30 refineries to more than 250 terminals

• 20 percent of all U.S. liquid product delivered by pipeline are handled by Colonial

4* This figure is intended to illustrate the timeline for the final highway and nonroad diesel fuel sulfur control programs. It is not drawn to exact scale. Refer to 40 CFR Part 80 for specific program dates.

All Diesel

~3400 ppm

All Diesel

~3400 ppm

HighwayDiesel

500ppm

HighwayDiesel

500ppm

All Off-Highway Diesel~3400 ppm

All Off-Highway Diesel~3400 ppm

>80%15 ppm>80%

15 ppm

<20% 500 ppm<20% 500 ppm

AllHighway15 ppm

AllHighway15 ppm

10/199310/1993 06/200606/2006 01/201001/2010

Highway + Nonroad Diesel Fuel Sulfur Specs*Highway + Nonroad Diesel Fuel Sulfur Specs*

NR, L&M Diesel500 ppm

NR, L&M Diesel500 ppm

NR 15 ppmNR 15 ppm

6/20076/2007 6/20106/2010

HWYHWYNRNR

L&M 500ppmL&M

500ppm

6/20146/2014

HHF ~3400ppmHHF ~3400ppm

Small & Credit15 ppm

Small & Credit15 ppm

6/20126/2012

Small & Credit ~500

Small & Credit ~500

Small & Credit ~3400Small & Credit ~3400

HHF ~3400ppmHHF ~3400ppm

L&M 15ppm

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Colonial Pipeline ULSD TestColonial Pipeline ULSD Test

Test Objective

• Determine capability to successfully move ULSD through existing pipeline system

• Use data to determine what physical and procedural modifications need to be made to ensure ability to transport ULSD

• Use test results to set sulfur specs at origins

Test Objective

• Determine capability to successfully move ULSD through existing pipeline system

• Use data to determine what physical and procedural modifications need to be made to ensure ability to transport ULSD

• Use test results to set sulfur specs at origins

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ULSD Test DescriptionULSD Test Description

• 1st Batch 140,000 B• Destinations

• Birmingham, AL• Atlanta, GA• Nashville, TN• Macon, GA• Greensboro, NC

• 1st Batch 140,000 B• Destinations

• Birmingham, AL• Atlanta, GA• Nashville, TN• Macon, GA• Greensboro, NC

• 2nd Batch 144,000 B• Destinations

• Birmingham, AL• Atlanta, GA• Greensboro, NC• Baltimore, MD• New York Harbor

• 2nd Batch 144,000 B• Destinations

• Birmingham, AL• Atlanta, GA• Greensboro, NC• Baltimore, MD• New York Harbor

Both batches originated into 36” distillate mainline at Baton Rouge and distributed along system to

representative locations.

Both batches originated into 36” distillate mainline at Baton Rouge and distributed along system to

representative locations.

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ULSD Test Description (continued)ULSD Test Description (continued)

• Multiple product sequences; Gasoline, high- and low-sulfur diesel and kerosine leading the ULSD test batches.

• Over 1500 samples analyzed.• Quantified trail-back of sulfur into ULSD batch

from adjacent products.• Quantified sulfur contamination from manifolds,

valves, dead segments, and high sulfur tank bottoms.

• Used special protective operating procedures for test batch.

• Multiple product sequences; Gasoline, high- and low-sulfur diesel and kerosine leading the ULSD test batches.

• Over 1500 samples analyzed.• Quantified trail-back of sulfur into ULSD batch

from adjacent products.• Quantified sulfur contamination from manifolds,

valves, dead segments, and high sulfur tank bottoms.

• Used special protective operating procedures for test batch.

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ULSD Test Batch

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19

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ULSD Test ObservationsULSD Test Observations

• “Successful” movement through system with sulfur increase of 6-8 ppm

• Size of product interface at head-end of batch was 1.5x to 2x normal

• Tank farms resulted in largest contribution of sulfur increase

• Valve integrity, tank line, manifold and dead leg segments were primary sources of sulfur increase

• Sulfur analyzers are complex and difficult to maintain• Normal cutting procedures (gravity) may be ineffective.

Therefore need quick, accurate, on-line sulfur analyzers.

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Test ConclusionsTest Conclusions

• Significant volume downgrade of ULSD (estimated to be 8% to 10% of total ULSD volume)

• Sulfur analysis equipment needs improvement

• Continued effort to understand and minimize tank farm issues

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Sulfur SpecificationSulfur Specification

Potential ULSD Specification at Refinery Gate = 5-7 ppm

Downstream Enforcement Tolerance + 2 ppm

Test Method Reproducibility -4 ppm*

Legal Requirement 15 ppm

Transportation Degradation -6 to -8 ppm**

Formula for Developing Product Specification

* ASTM “round robin” results have a reproducibility range from 6-16 ppm.

PLUS

MINUS

MINUS

* *depending upon the number of tank farms

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3rd PartyTank

Product Movement Refinery to End UserProduct Movement

Refinery to End UserAfter refining, products must be shipped from the refinery to terminals where it can be

loaded onto tanker trucks bound for gas stations, homes, businesses and airports.After refining, products must be shipped from the refinery to terminals where it can be

loaded onto tanker trucks bound for gas stations, homes, businesses and airports.

RefineryTank

Refinery ColonialIntermediate

Terminal Tank

StublineColonialOrigin

Terminal Tank

Third Party Pipeline

ColonialIntermediate

Mainline

ColonialOrigin

Mainline

Stubline

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IdealReceive into Colonial 7Upstream transfer system 2Colonial improves from 6-8 5Downstream transfer system 2Reproducibility improves to 4 2TOTAL 18

Possible Colonial Sulfur SpecificationPossible Colonial Sulfur Specification

The specification is 17 ppm at retail.

If every step improves…If every step improves…

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ULSD Pathforward for ColonialULSD Pathforward for Colonial

• Implement special operating procedures for ULSD handling.

• Evaluate construction of additional tanks and modify manifolds. - May require ULSD surcharge to existing diesel tariffs.

• Concern with upstream and downstream facilities handling.

• Work with customers to determine “appropriate, workable” specification at refinery gate.

• May not supply all diesel grades to all markets.

Q&AQ&A