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Relationship between Values of Business Processes

and Need for Supervisory Control and Data

Acquisition (SCADA) Systems in Oil Refineries.

By

VINEETH KURUCHETI

With the assistance of

Nary Subramanian, Ph.D., Committee Chair

A research project submitted in partial fulfillment

Of the requirements for the degree of

Master of Science in the

Department of Computer Science

(CSE)

The University of Texas at Tyler

Tyler, Texas

May 2010

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The University of Texas at Tyler

Tyler, Texas

This is to certify that the Master’s Project of

VINEETH KURUCHETI

Has been approved for the research project requirement on 05/03/2010 For the Master of Computer Science degree

Approvals: Dr. Narayanan Subramanian, Ph.D:______________________________

(Project Chair)

Dr. George M. Whitson, Ph.D: _________________________________

(Committee Member)

Dr. Kazem Mahdavi, Ph.D: ____________________________________

(Committee Member)

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Acknowledgement

I would like to thank my family and all my friends who have been a

constant source of encouragement and inspiration in my life. Their

support has helped me to courageously face the challenges that I

encountered in the process of pursuing my educational career.

I would like to thank the faculty of the Department of Computer

Science at The University of Texas at Tyler for providing me an

excellent platform to hone my Computer skills and achieve my Master’s

degree.

Special Thanks to my advisor, Dr. Narayanan Subramanian for his

constant encouragement and taking a lot of effort in completing this

project and being available at all the times that I needed him.

Thanks to my Committee members, Dr. George M. Whitson and Dr.

Kazem Mahdavi who spent their valuable time in looking into my

report.

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Contents

Abstract ………………………………………………………………………...…7

Chapter 1

Introduction...................................................................................................... 8

Chapter 2

2.1 Importance of a Business Process Methods & Control……………………… 10

2.2 Business Process Management Lifecycle (BPM)……………………………. 11

2.3 The Importance of Business Process Improvement…………………………. 12

a How Can Business Process Improvement Aid Company Performance?...... 13

Chapter 3

SCADA system….………….…..…………………………….…….…………… 14

3.1 What is a SCADA system ……………………….…….……………………. 14

3.2 Layers of SCADA system...….………….…………………………….…….. 15

Chapter 4

Oil Refinery Business Processes….………………………...……………….…. 18

4.1 Business Processes in an Oil Refinery……………………………………… 18

a Crude selection…………………………………………………………….. 18

b Crude transportation………………………………………………………. 19

c Crude processing ………………………………………………………….. 19

d Product demands …………………………………………………………. 20

4.2 Barrel of Crude Oil………………………………………………………..… 21

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Chapter 5

Simulation……………………………………………………………………….. 22

5.1 Oil Refinery Business Processes…………………………………………..... 22

5.2 Oil Refinery Business Processes Simulation………………………………. 23

5.3 Phases in Oil Refinery Business Processes………………………………… 24

5.4 What Is The Profit-Margin For Refining Crude Oil Into Gasoline………… 37

5.5 Cost Estimation for processing 2 million barrels of crude Oil………………. 37

Chapter 6

SCADA Requirements…………………………………………………………. 41

6.1 The 2 Basic Components of SCADA……………………………………….. 41

6.2 Where SCADA can be used…………………………………………………. 42

6.3 SCADA System Operation………………………………………………….. 42

6.4 Parts enable a SCADA system to perform four types of tasks……………. 43

6.5 SCADA Requirement in Business Processes of an oil refinery…………… 45

a SCADA system for Oil Pipelines………………………………………….. 45

b SCADA system for storage tanks and reactors……………………………. 46

Chapter 7

Relationship between Business values and SCADA Requirements…………. 48

7.1 SCADA Technology evolves to create new market dynamics……………. 48

7.2 Determining the phase in the business processes of an oil refinery where

SCADA system is much needed to increase the profit-margins…………. 49

7.3 Phases in oil refinery where RTU’s and Master Units are must need…….. 50

SCADA need in oil refinery…………………………………………………….. 52

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Chapter 8

Conclusions and future work ……………………………………….….……… 53

Chapter 9

References…………………………….……………………….…….…………... 54

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Abstract

The SCADA (Supervisory Control and Data Acquisition) system consists of a Master

system that communicates with the Remote Terminal Units (RTU) to gather data and check the

values for the optimum functioning of the oil refinery. The SCADA system checks various

parameters like the pressure, temperature, density of the oil inside the pipeline’s and storage

tanks in the oil refinery. In this project we first find the business processes that are involved in

the oil refinery and estimate the total cost and profits made on refining crude oil by simulating

using AccuProcess Simulator (APS). Secondly, we use the business processes values to find out

what phases in oil refinery require SCADA system for monitoring. We find that, higher the value

of business process the more SCADA equipment is needed.

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Chapter 1

Introduction

As the price of crude oil continues to remain high, refineries across the globe are

increasingly focused on initiatives to protect their margins. Flexibility in changing the processes

to get aligned to the dynamic business scenario is being aimed by the refiners. Refinery

executives are keenly examining on probable effective ways of managing & motivation their

people, managing their business process and changing technology accordingly, to get tune their

operations with dynamic supply chain in the business. [1]

Modern crude optimization techniques have challenged organizations to rethink the way

they conduct business both internally and externally, i.e. how efficiently and effectively their

entire supply chain is managed. Supply Chain Management (SCM) is one such business

function that has benefited substantially from optimization software advances and solutions.

The primary goal of SCM is to maximize profit by integrated management of material and

transactional flows within a business and to customer and partner companies.

The petroleum refining industry has effectively embraced the software solutions (e.g.

SCADA systems) to optimize the business supply chain to maximize the profit margins and

create order in the chaos of numerous opportunities and challenges. The supply chain of a

typical petroleum refining company involves a wide spectrum of activities, starting from crude

purchase and crude transportation to refineries, refining operations, product transportation and

finally delivering the product to the end user. The nature of the value chain is such that its

economics are extremely complex and heavily linked. For example, the process of selecting the

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right crude is linked not only to the transportation costs involved in delivering it to the refinery,

but it must take into consideration the refinery configuration, capabilities and constraints in

converting the crude into products, as well as the product volume and price fluctuations.

In this project we will discuss about business values and SCADA system, later we

simulate the business processes of an oil refinery in order to calculate the cost involved in the oil

refinery. After that, we will discuss about the SCADA requirements in the oil refinery, from the

values produced by the simulation we determining the phase in the business processes of an oil

refinery where SCADA system is much needed to increase the profit-margins.

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Chapter 2

This chapter briefly describes the Business Process Management Lifecycle (BPM) and its

importance in oil refinery.

2.1 Importance of a Business Process Methods & Control

A business process or business method is a collection of related, structured activities or

tasks that produce a specific service or product (serve a particular goal) for a particular customer

or customers. It often can be visualized with a flowchart as a sequence of activities.

There are three types of business processes: [2]

1. Management processes, the processes that govern the operation of a system. Typical

management processes include "Corporate Governance" and "Strategic Management".

2. Operational processes, processes that constitute the core business and create the primary

value stream. Typical operational processes are purchasing, manufacturing, marketing

and sales.

3. Supporting processes, which support the core processes. Examples include accounting,

recruitment, and technical support.

A business process begins with a customer’s need and ends with a customer’s need

fulfillment. Process oriented organizations break down the barriers of structural departments and

try to avoid functional silos.

A business process can be decomposed into several sub-processes, which have their own

attributes, but also contribute to achieving the goal of the super-process. The analysis of business

processes typically includes the mapping of processes and sub-processes down to activity level.

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Business Processes are designed to add value for the customer and should not include

unnecessary activities. The outcome of a well designed business process is increased

effectiveness (value for the customer) and increased efficiency (less costs for the company).

Business Processes can be modeled through a large number of methods and techniques. For

instance, the business process modeling notation is a business process modeling technique that

can be used for drawing business processes in a workflow.

2.2 Business Process Management Lifecycle (BPM)

The business process lifecycle consists of the steps shown in Figure 1. [3]

Figure 1: Business process lifecycle

Model and Simulate: Business process owners create a high-level design of the tasks to

be done and a list of the required resources. This is usually done graphically using a

drawing package such as Microsoft Visio or a proper modeling tool such as Popkin's

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System Architect. The modeling tool may also be used to perform optional simulation

steps during which hypothetical scenarios are run to identify critical paths and

bottlenecks.

Implement and Deploy/Execute: Developers convert the business process definitions

into an executable process model linking systems, APIs, and people through workflows.

The resulting executable process is then deployed to a BPEL or BPM engine for

execution.

Monitor and Optimize: Deployed business processes are monitored to measure key

performance indicators and other metrics. Process throughput and utilization metrics can

be fed into a simulation tool to derive the optimal execution mode by using real data (e.g.

historical).

2.3 The Importance of Business Process Improvement

In order for a business to make money and to remain effective over time, leadership must

continually plan and oversee the organization from the top-down. If businesses have a clear

understanding of their day-to-day operations and processes, they stand a better chance of long-

term success. A crucial component in understanding, solidifying and enhancing operations is a

practice known as business process improvement. [4]

Business process improvement is defined as a systematic approach that allows companies

to optimize their core processes in order to obtain the most efficient results. When companies

engage in process improvement, they will start to define:

- The goals and objectives of the business itself

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- The purpose of the business

- Who their customers really are

- What strategic improvements need to be made?

- Which processes should be improved or eliminated to ensure maximum efficiency and

profitability

When it comes to business process improvement, the overall goal is to determine which

company processes are the most efficient and what processes are problematic. The company will

then be able to determine the steps it needs to take to reach its’ goals. For example, in cases

where a company has inefficiencies or is spending too much money on resources that it does not

need, it would evaluate how to best improve its process so that it is efficient and able to

maximize its’ performance. Business process mapping is typically used to achieve these goals.

2.3.a How Can Business Process Improvement Aid Company Performance?

In today’s struggling economy, more and more businesses are starting to realize that in

order to survive they must improve their existing processes and address areas of concern. Often

times, businesses struggle in one way or another, whether they have poor customer service or

their sales are simply down. If a business wants to correct problems and optimize its

performance, it will have to take a close look at its existing processes and start making

improvements. Process improvement begins when a company identifies its problem areas. The

company must then document and measure how these problems are adversely impacting business

and revenue. Finally, the company must manage the problem and find effective solutions. By

finding solutions, the company will make necessary improvements and will ultimately perform

better over time. When business process improvements are implemented correctly, the end result

is usually higher performance and increased monetization.

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Chapter 3

SCADA system

This chapter briefly describes the SCADA system and its application in oil refinery.

3.1 What is a SCADA system?

SCADA stands for Supervisory Control and Data Acquisition. It is an industrial control system

used to control and monitor a process. SCADA consists of the following subsystems. [5]

Human machine interface (HMI)

Supervisory control system

Communication infrastructure

Remote terminal units(RTUs)

A Human-Machine Interface or HMI is the apparatus which presents process data to a

human operator, and through this, the human operator, monitors and controls the process.

A supervisory control system collects data on the process and sends commands

(control) to the process.

The Remote Terminal Units (RTUs) are small computerized units deployed in the field

at specific locations to gather reports from sensors within the process.

Communication infrastructure connects the supervisory system to the Remote

Terminal Units.

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3.2 Layers of SCADA system

Generally, a SCADA system has three layers, SCADA master, communication media, and local

control system shown in Figure 2. [6]

SCADA

Figure 2: Example of a SCADA system

SCADA is an acronym for "Supervisory Control and Data Acquisition", meant to explain the

very essence of the system.

SCADA is a technology permitting to collect and process data received from the remote (in

terms of distance from the control center) objects, and transmit commands via cable or radio

communication systems.

SCADA may either eliminate the necessity of the on-going technological process personnel's

presence, or drastically reduce the number of inspection visits to the system's objects.

SCADA is a technological control and management system providing for highly efficient

cost effective production.

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SCADA enables a technological process operator to monitor and control equipment status, to

open and shut valves or motors, to view each of the technological process parameters all

from a single Central Control Room.

SCADA systems are based on modern microprocessor and networking technologies enabling

the system designer to implement a scalable application that can grow with expanding needs.

3.2.a SCADA master

The SCADA master is set up at central locations (multiple masters can be established) of

your operational organization. SCADA master consists of three main parts, SCADA console,

SCADA server, and MTU (Master Terminal Unit). The console is HMI (Human Machine

Interface) for your operation. The server contains database(s) for historical trend of relevant data.

MTU is a terminal that communicates with RTUs (Remote Terminal Unit). Each piece of

SCADA master equipment is a node in SCADA master LAN (Local Area Network). The number

and locations of SCADA master are determined for each application, depending on operation

plan, total system reliability and other design terms.

3.2.b Communication media

For the data communication between MTU and RTU, communication media will be

chosen from leased line, microwave radio, UHF/VHF radio, fiber optic transmission, or satellite

communication. If you need to own new communications by yourself, installation cost of

communication media tends to have a large impact on your total investment. Before you choose

the best one for communication, it is important to consider your requirements, local installation

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constraints, communication service availability, and total system reliability. Back up circuits

using different communication media from the main circuits are sometime provided to increase

the strength of communication circuits.

3.2.c Local control system

The local control system includes all necessary control functions required for a local

station and communication capability with SCADA masters. For a relatively small station such

as a block valve station, a small RTU is suitable. On the other hand, a DCS (distributed control

system) is often adapted to a terminal or booster station. It is crucial to design a local control

system to safely continue controls in case of communication circuits failure with SCADA

master(s). If incase oil pipeline is running cross-country, the power supply for stations often

poses a problem. In such case, solar cells or a small power station is built to a local station.

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Chapter 4

Oil Refinery Business Processes

This chapter briefly describes the Business Processes involved in the oil refinery.

4.1 Business Processes in an Oil Refinery

Modern optimization techniques have challenged organizations to rethink the way they

conduct business both internally and externally, i.e. how efficiently and effectively their entire

supply chain is managed. Supply Chain Management (SCM) (Refer to Figure 3) is one such

business function that has benefited substantially from optimization software advances and

solutions. The primary goal of SCM is to maximize profit by integrated management of material

and transactional flows within a business and to customer and partner companies.

4.1.a Crude selection

Modern petroleum refineries are designed to process a variety of indigenous and

imported crudes. As the crude cost is about 90% of the refinery input cost, the selection of

optimum crude mix is extremely important to achieve higher margins. However, the number of

options for buying the crudes under a fluctuating price scenario and transporting them to

refineries are so enormous that it is very difficult to evaluate all the crudes and decide on the

optimum crude mix for the refinery. Refineries buy crudes both on term contracts with leading

suppliers and also by spot purchases from the market. The optimum selection of term and spot

crudes is extremely difficult when multiple refineries are involved and work in an integrated

scenario. [8]

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4.1.b Crude transportation

Once the crudes are selected and purchased, the focus is to optimize the transportation

cost from the crude suppliers to refineries. The transportation cost can be minimized by

considering the multiple options available for cargo sizes, sea routes, loading and unloading

infrastructure facilities, taxes and duties, etc.

4.1.c Crude processing

The crudes often land at refinery sites as a mix of various crudes and various options of

crude blending are evaluated before it is processed. The ultimate challenge a refinery faces is

processing the crudes in the best possible manner and maximize the $/bbl (dollars per barrel) for

the crude input. Determining the “best possible” option is a very difficult task, as modern day

refineries are built with complex processing schemes, having a combination of various

technologies for heavy ends upgrading, product quality improvement, efficient fuel usage and

controlling refinery emissions. The most common configuration includes catalytic cracking,

hydro cracking and thermal cracking to maximize the bottom of the barrel. The other process

technologies like catalytic reforming, hydro treating and sulfur recovery are a must to comply

with stringent environment and product quality regulations.

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Figure 3: Typical Supply chain of Petroleum business

4.1.d Product demands

The product demands, quality and prices drive the entire crude processing and secondary

unit operations. Multiple streams with multiple blending options to make different grades of a

product further make the task of refinery planning cumbersome and demanding.

Moreover, the future promises to add even more complexity through additional product

specifications, environmental norms, changing feedstock, product prices, mergers and

acquisitions.

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4.2 Barrel of Crude Oil

A Barrel (Shown in Figure 4) of crude oil

contains

50% of Gasoline

40% Diesel Fuel, Jet Fuel, Kerosene

10% Residual Fuel

Figure 4: A barrel crude oil contain

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Chapter 5

Simulation

This chapter briefly describes the simulation of Business Processes in an oil refinery.

5.1 Oil Refinery Business Processes

An oil refinery or petroleum refinery is an industrial process plant where crude oil is

processed and refined into more useful petroleum products, such as gasoline, diesel fuel, asphalt

base, heating oil, kerosene, and liquefied petroleum gas. Oil refineries (Referred in Figure 5) are

typically large sprawling industrial complexes with extensive piping running throughout,

carrying streams of fluids between large chemical processing units. In many ways, oil refineries

use much of the technology. [9]

Figure 5: Oil refinery plant

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5.2 Oil Refinery Business Processes Simulation

Accuprocess simulator was used to simulate the business processes of an oil refinery.

Figure 6: Oil Refinery Business Processes Simulation

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5.3 Phases in Oil Refinery Business Processes

Business processes of an oil refinery were divided in to 8 phases.

5.3.a Pumping Crude Oil

In this activity a supertanker containing crude oil is considered. The oil from the tanker is

pumped into oil pipelines in order to transport the crude to the refinery.

Figure 7: Pumping Crude Oil (refer to Figure 6)

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5.3.b Crude Transportation

Crude oil that is pumped out from the supertanker is transported to the oil refinery

through pipelines.

Figure 8: Crude Oil Transportation (refer to Figure 6)

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5.3.c Crude Storage

In this activity the crude that was traveled through the pipelines are stored in the storage

tanks as shown in Figure 6.

Figure 9: Crude Storage (refer to Figure 6)

5.3.d Oil Refinery Initial Phase

This is the initial phase of the oil refinery technical process, in this phase the crude that

was stored in the storage tanks was subjected to Crude Distillation and Vacuum Distillation.

i) Crude Distillation

• Process Objective:

– To distill and separate valuable distillates (naphtha, kerosene, diesel) and atmospheric gas oil

(AGO) from the crude feedstock. [10]

• Primary Process Technique:

– Complex distillation

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ii) Vacuum Distillation

• Process Objective:

– To recover valuable gas oils from reduced crude via vacuum distillation.

• Primary Process Technique:

– Reduce the hydrocarbon partial pressure via vacuum and stripping steam.

Figure 10: Oil refinery Initial phase (refer to Figure 6)

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5.3.e Oil Refinery Intermediate Phase

In this phase the distilled crude oil is subjected to Hydro treating, Coking, Fluidic

Catalytic Cracking and Hydro cracking in order to separate, purify as well as to upgrade variety

of feeds from the distilled crude.

i) Hydro treating Process

• Process Objective:

– To remove contaminants (sulfur, nitrogen, metals) and saturate olefins and aromatics to

produce a clean product for further processing or finished product sales.

• Primary Process Technique:

– Hydrogenation occurs in a fixed catalyst bed to improve H/C ratios and to remove sulfur,

nitrogen, and metals.

Figure 11: Oil Refinery Intermediate Phase (Hydro treating) (refer to Figure 6)

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ii) Coking Process

• Process Objective:

– To convert low value resides to valuable products (naphtha and diesel) and Coker gas oil.

• Primary Process Technique:

– Thermo cracking increases H/C ratio by carbon rejection in a semi-batch process.

Figure 12: Oil Refinery Intermediate Phase (Coking) (refer to Figure 6)

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iii) Fluidic Catalytic Cracking

• Process Objective:

– To convert low value gas oils to valuable products (naphtha and diesel) and slurry oil.

• Primary Process Technique:

– Catalytic cracking increases H/C ratio by carbon rejection in a continuous process

Figure 13: Oil Refinery Intermediate Phase (Fluidic Catalytic Cracking) (refer to Figure 6)

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iv) Hydro cracking Process

• Process Objective:

– To remove feed contaminants (nitrogen, sulfur, metals) and to convert low value gas oils to

valuable products (naphtha, middle distillates, and ultra-clean lube base stocks).

• Primary Process Technique:

– Hydrogenation occurs in fixed hydro treating catalyst beds to improve H/C ratios and to

remove sulfur, nitrogen, and metals. This is followed by one or more reactors with fixed

hydro cracking catalyst beds to dealkylate aromatic rings, open naphthene rings, and

hydrocrack paraffin chains.

Figure 14: Oil Refinery Intermediate Phase (Hydro Cracking) (refer to Figure 6)

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5.3.f Oil Refinery Final Phase

In this final phase the separated mixture will undergo Isomerization, Catalytic Reforming

and Alkylation in order to produce the end products like Gasoline, Hydrogen, and Aromatics.

i) Isomerization Process

• Process Objective:

– To convert low-octane n-paraffins to high-octane iso-paraffins.

• Primary Process Technique:

– Isomerization occurs in a chloride promoted fixed bed reactor where n-paraffins are converted

to iso-paraffins. The catalyst is sensitive to incoming contaminants (sulfur and water).

Figure 15: Oil Refinery Final Phase (Isomerization) (refer to Figure 6)

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ii) Alkylation Process

• Process Objective:

– To combine light olefins (propylene and butylene) with isobutane to form a high octane

gasoline (alkylate).

• Primary Process Technique:

– Alkylation occurs in the presence of a highly acidic catalyst (hydrofluoric acid or sulfuric

acid).

Figure 16: Oil Refinery Final Phase (Alkylation) (refer to Figure 6)

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iii) Catalytic Reforming Process

• Process Objective:

– To convert low-octane naphtha into a high-octane reformate for gasoline blending and/or to

provide aromatics (benzene, toluene, and xylene) for petrochemical plants. Reforming also

produces high purity hydrogen for hydro treating processes.

• Primary Process Technique:

– Reforming reactions occur in chloride promoted fixed catalyst beds; or continuous catalyst

regeneration (CCR) beds where the catalyst is transferred from one stage to another, through a

catalyst regenerator and back again. Desired reactions include: dehydrogenation of naphthenes

to form aromatics; isomerization of naphthenes; dehydrocyclization of paraffins to form

aromatics; and isomerization of paraffins. Hydro cracking of paraffins is undesirable due to

increased light-ends make.

Figure 17: Oil Refinery Final Phase (Catalytic Reforming) (refer to Figure 6)

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5.3.g Product Storage

All the Refined Products are collected and stored. Storage is an important phase in the oil

refinery in order to increase the price of the final product.

"You may only pay $40 a barrel, but you could sell it today, lock in a future price much,

much higher, just a few months down the road and take advantage of that. You could lock in, per

barrel, a $3 or a $5 or, if you could hold the oil long enough, maybe even a $10 profit.” [11]

Figure 18: Refined product storage (refer to Figure 6)

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5.3.h Marketing & Supply

Marketing and Distribution of petroleum products takes place on a vast, global scale.

Every day, hundreds of millions of companies and individuals buy these products at wholesale or

directly from retail outlets as shown in Figure 6.

Figure 19: Marketing & Supply (refer to Figure 6)

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5.4 What Is The Profit-Margin For Refining Crude Oil Into Gasoline?

As of 1999, for every gallon of gasoline refined from crude oil, U.S. oil refiners made an

average profit of 22.8 cents. By 2004, the profits jumped to 40.8 cents per gallon of gasoline

refined. In the specialized California market where the gasoline must conform to the

requirements of the California Air Resources Board, refinery margins were even higher. In fact,

this helped Exxon, the largest company, report a profit (as of February 2008) of $40.6 billion.

Nevertheless, one financial tracking institution reported that the profit-margins have now

dropped to about 29.6 cents a gallon or around 60 percent lower than a year ago.

Generally speaking, since there are so many variables to consider, precise cost breakdowns

are difficult to ascertain. According to the Energy Information Administration (EIA), however,

which issues the “Official Energy Statistics from the U.S. Government” the average cost at the

pump for a gallon of gasoline is broken down as follows:

74% - Cost of the crude oil

11% - Taxes

10% - Refining costs

5% - Distribution and marketing

5.5 Cost Estimation for processing 2 million barrels of crude Oil

In this cost estimation we estimate the total cost of 2 million barrels of crude oil to refine

(including man power) and determine the profit for one gallon of refined oil by comparing with

the current oil prices in the market.

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5.5.a Cost for buying crude oil

A supertanker holds roughly 2 million barrels or 84 million gallons of crude oil.

1 barrel contain 42 gallons

Crude-oil futures rose above $82 a barrel

Ship cost of a crude oil 2000000 * 82 = 164,000,000 $

Shipping crew wages = 22,000 $

5.5.b Cost for transporting crude oil to the refinery

Here there are different types for transporting crude to refinery (e.g. Road transportation,

Pipelines, etc.)

We are considering pipelines because it was the cheapest of all.

Pipeline with a capacity of 600 million barrels per day (mb/d) costs nearly 2.52 cents per barrel.

So for transporting 2 million barrels is 2000000 * 2.52 cents = 5040000 cents = 50,400 $ (shown

in Figure 20)

5.5c Cost for refining crude oil

Total cost of the technical processes in the refinery.

Figure 20: Simulated values for total cost of each activity

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Technical processes Cost (Process cost including man power)

Crude Distillation/Vacuum Distillation 3,970,432

Hydro treating 2,942,950

Coking 2,711,620

Fluidic Catalytic Cracking 2,902,320

Hydro cracking 2,803,030

Isomerization 2,842,800

Alkylation 2,514,940

Catalytic Reforming 2,651,730

Total 23,339,822 $

5.5.d Cost for Storing refined oil

"You may only pay $40 a barrel, but you could sell it today, lock in a future price much,

much higher, just a few months down the road and take advantage of that. You could lock in, per

barrel, a $3 or a $5 or, if you could hold the oil long enough, maybe even a $10 profit." Storage

cost per year 5, 54,439 $ (shown in Figure 20)

5.5.e Cost for Marketing and Distribution of refined oil

Every day, critical business outcomes depend on seamless supply and trading around the

globe. Marketing and Distribution of petroleum products takes place on a vast, global scale.

Every day, hundreds of millions of companies and individuals buy these products at wholesale or

directly from retail outlets.

Trading & Supply cost 5,230,000

Marketing & Distribution cost 5,230,000

Total cost 10,460,000 $

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Overall Estimation

Overall Cost 164,000,000 (crude oil) + 22,000 (shipping crew wages) + 50,400 (transporting

crude) + 23,339,822 (process cost including man power) + 5, 54,439 (storage cost) + 10,460,000

(marketing and distribution)

198,096,661

Tax’s on each gallon of refined oil 23cents according to the

California Energy Commission [14]

So for 84 million gallons of refined oil => 84000000 * .23 = 19,320,000 $

Total refinery cost with Tax’s = 198096661 + 19320000 = 217,416,661

Today each gallon of refined oil cost 3.00 $ (retail price)

So for 84,000,000 gallons of refined oil cost => 84000000 * 3 = 252,000,000 $

Profit made on 84 million gallons of refined oil => 252000000 -217416661 = 34,583,339

Profit on 1 gallon of refined oil 34,583,339 / 84,000,000 = 41.1 cents

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Chapter 6

SCADA Requirements

This chapter briefly describes the requirements for SCADA in an oil refinery.

6.1 The 2 Basic Components of SCADA

Any SCADA scenario involves 2 basic components [7]

1. Things you want to monitor and control

2. Devices you will use to perform monitoring and controlling functions

As stated above, SCADA systems are used to collect data and control processes at the

supervisory level. Therefore, one of the major components of a SCADA system is having

something that you want to control. This could be a system or process, or even specific

machinery. These SCADA-monitored elements could be just about anything, from an oil refinery

plant, a power-generation system, an organization’s communication network, or even a simple

switch.

To monitor and control these elements using a SCADA system, you will need devices to

collect data from them and issue commands. This network of monitoring and control devices

makes up your SCADA system. Using sensors (discrete or analog) and control relays, the system

can collect information about processes and control individual pieces of equipment. The system

is governed by a SCADA master, that collects data from monitoring devices and issues controls

in response (either automatically or at the request of human operators).

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6.2 Where SCADA can be used

While SCADA can be used to manage any kind of equipment, SCADA systems are

typically for the automation of industrial processes where humans are unable to manage complex

or rapid operations. These are often fast-paced processes dealing with extremely delicate and tiny

parts and equipment that are simply too difficult for human operators to monitor with any

consistent level of accuracy.

6.3 SCADA System Operation

There are four parts common to every SCADA system:

1. Sensors (either digital or analog) and control relays - These are input/output devices

that monitor and control the managed processes and equipment.

2. Remote Terminal units (RTU’s) - These are devices deployed in the field at specific

sites and locations. RTU’s gather information locally from the sensors to report back to

the SCADA master unit.

3. SCADA master units- SCADA master units are the main, user-end component of the

entire SCADA monitoring system. They are also sometimes referred to as the SCADA

HMI (Human-Machine Interface). The master provides the central processing capability

for the SCADA system. Master units connect the human operators to the system with a

browser interface that allows the system operator to respond to data gathered from all

parts of the network.

4. The communications network- The communication network provides the connection

between the SCADA master unit and the RTU’s in the field. It is the all-important link

between the far-flung elements of a geo-diverse operation.

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6.4 Parts enable a SCADA system to perform four types of tasks:

1. Data collection- A SCADA system is composed of large numbers of sensors that collect

inputs into a system, or measure the output levels of a system or process. The information

collected by these sensors is collected by the RTU’s locally, and then forwarded to the

SCADA master, where reports and alarms are presented to the network operator.

Sensors can be classified as two types, either discrete or analog. Discrete sensors collect

information about simple events, whereas analog sensors can provide more detailed

information that can fall within a range of values, rather than a present/not present type of

situation. Analog sensors are particularly useful in measuring environmental factors, such

as temperature and humidity, battery levels, fuel levels, and more.

2. Communication of data across the network- To monitor geo-diverse operational

systems from a centralized location, you need a communications network. This network

provides you with a means to transport all information collected across the system.

SCADA communications generally take place on Ethernet and IP over SONET. To

alleviate security concerns when transporting sensitive data, communication of data

should be done over internal LAN/WANs, not the public Internet.

SCADA uses protocol communication methods, so input and output devices cannot

interpret or create SCADA communications on their own. RTU’s interpret information

from attached sensors and transmit it to the SCADA master (HMI). In turn, the RTU

receives control commands in protocol format from the SCADA master, and forwards

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these commands to the appropriate control relays. This allows the SCADA master to

control individual operational processes throughout the network from a single location

3. Information reporting- A SCADA system presents data to operators via the SCADA

HMI (Human-Machine Interface). Along with presenting this data, the SCADA master

station also performs many other tasks for network operators. The master continuously

monitors all sensors and alerts the operator when there is a Change-of-State (COS) event

within the managed system.

The master presents a comprehensive view of the entire network of devices, and presents

more specific information about the managed equipment and processes when the system

operator requests it. The master also presents reports and summarizes historical trends of

data gathered by the system.

4. System control functions- A SCADA solution with control functions can respond to

COS events anywhere in the system by automatically issuing related, user-specified

commands. If you have an advanced SCADA master, this can be done without any

human intervention at all, resulting in instantaneous response to dynamic problems and

threats. Advanced systems also allow overriding of automatic controls as the need occurs.

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6.5 SCADA Requirement in Business Processes of an oil refinery

SCADA is required in different phases of an oil refinery, in order to manage complex or

rapid operations which are difficult for human to operate and monitor. Oil refinery needs

SCADA for different purposes like, to manage the temperature and pressure in the reactors, to

control the flow of fluids in the pipelines, to collect the data and values for testing the purity of

the refined products and also need sensors to detect the tank levels.

6.5.a SCADA system for Oil Pipelines

Oil is transported from the oil wells or oil containers to the refineries and refineries to

various places through the pipelines. Since the oil pipelines travel through hundreds of miles, a

single system cannot monitor the entire pipeline. Hence many devices like field instruments,

programmable logic units and RTU’s are placed at different places throughout the pipeline.

These field instruments and the programmable logic units are connected to RTU’s and the

SCADA system is used to monitor all these RTU’s. Various parameters are being sensed by

these devices namely pressure, temperature of the oil flowing inside the pipeline, density of the

liquid flowing etc.

Since there are many RTU’s located at different places throughout the pipeline and since

all these RTU’s communicate with the SCADA master system (as shown in Figure 22), rapid

exchange of data takes place. The RTU’s sends the data to the SCADA master system and the

SCADA master system checks if everything is working well or if there are any changes to be

made. If there are any changes to be made, the SCADA master sends a message to the respective

RTU and it performs the required action.

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Any minor change in the pipeline can be detected by the SCADA master system and the

required action can be taken. The application of SCADA has reduced huge amount man power

requirements in the field which in turn has reduced the expenditure

Figure 22: Oil pipeline SCADA System Architecture

6.5.b SCADA system for storage tanks and reactors

SCADA Systems are often used to maintain oil storage tank and reactor levels with

offsite pump stations. The SCADA system monitors and controls the oil level in the storage

tanks and reactors, provides tank level control from several offsite pump stations, allows

operators to specify set-points, displays graphical representations of the tank and the system,

provides alarm features, and generates trending and historical data. [12]

The systems are programmed to start and stop pumps based on operator-adjustable tank

level set-points. The pressure transmitter continuously measures a tank level variable and

transmits signal representing the level to the local RTU. (As shown in Figure 23)

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RTUs were installed at each offsite location. For each given pump, there is a start and

stop command based on tank level and an alternation scheme. The system monitors the tank level

and controls pumps according to the set-points. If the tank level drops, the system activates a

pump, monitors the levels, and stops the pump. It also monitors for potential pump failures or

failure conditions, and keeps track of the pump usage for allotment purposes. Operator override

pump control and pump disable is permitted.

Different operation performed by SCADA system in storage tanks and reactors

Monitor high and low levels in the tanks.

Fill them when a certain level is reached.

Calculated and store the volume used.

Monitor the level in the main feed tank.

Alarm when a certain level is reached to notify purchasing.

Plot the usage of chemicals vs. time, process, or any other parameter.

Turn pumps, valve, switches on and off. [13]

Figure 23: Storage tank SCADA System Architecture

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Chapter 7

Relationship between Business values and

SCADA Requirements

In this chapter we discuss and determine the phase in the business processes of an oil

refinery where SCADA system is more needed to increase the profit-margins.

7.1 SCADA Technology evolves to create new market dynamics

The role of SCADA (Supervisory Control and Data Acquisition) systems continues to

grow with requirements for more quality monitoring, efficiency monitoring, real-time OEE

(Overall Equipment Effectiveness), sub metering and alarm monitoring. Remote Terminal Units

(RTU) technology provides monitoring for remote locations operating wirelessly. [15]

The worldwide SCADA market reflects the impact of new technology on SCADA

components and cost effective communications for knowledge transfer. SCADA components are

easier to integrate and provide vastly improved capabilities and functionalities. Communication

limitations have been eliminated. Consequently, SCADA systems are being used for a range of

operational improvement applications and linking these to business processes for a variety of

purposes both internal and external to the enterprise.

Supported by intelligent field devices, expanded communication networks, and improved

compatibility with IT, SCADA can now provide a wealth of information and knowledge to help

users modify their business processes. The effective use of today's SCADA systems requires

their usage be leveraged to encompass both robust control and automation functionalities and,

Page | 49

more importantly, the capability to support higher-level systems that overlap into enterprise

optimization for utility and energy companies.

7.2 Determining the phase in the business processes of an oil refinery where

SCADA system is much needed to increase the profit-margins

The four major SCADA system components include the Master Terminal Unit (MTU),

the Remote Terminal Unit (RTU), Communication Equipment and SCADA Software

Setting a SCADA system involves placing sensors at right places and connecting those

sensors to a Remote Terminal Unit (RTU) which are placed at the specified sites and locations.

They gather information locally from the sensors to report back to the SCADA master unit.

Master units are larger computer consoles that serve as the central processor for the SCADA

system.

Cost to setup a true SCADA system is approximately $30,000, SmartSCADA provides a

complete packaged solution, with all of the components necessary for a successful system: [16]

--SCADA Master Station

--Key Applications

--SOFTWARE

--Substation Controller (RTU’s)

--Training

--Project Management

--Service and Support

--Optional Communications

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7.3 Phases in oil refinery where RTU’s and Master Units are must needed

SCADA system is much needed where there is a huge amount of money invested in the

refinery, because SCADA is a technological control and management system which provides

highly efficient cost effective production.

Since 75% of the total investment goes for the purchase of crude oil. Only 25 % of the

amount was invested in different phase of an oil refinery.

7.3.a Pumping crude oil

In this phase a single sensor and a single RTU is sufficient, in order to acquire the data

like rate at which the system is pumping crude oil and to calculate the amount of crude oil

pumped. In this phase there is no need of a Master Unit.

7.3.b Transporting crude oil

Cost estimation in this phase for transporting 2 million barrels of crude oil = 50,400 $

Transporting crude trough pipelines, in this phase 4 -5 RTU’s are sufficient to record the

flow of crude in the pipeline, and to detect the leakage in the pipeline. This phase need a Master

Unit to monitor and control the flow as well as to control the valves.

7.3.c Crude and final products storage tanks

Estimated cost in this phase for storing 2 million barrels of crude oil = 5, 54,439 $

This phase need only sensors to detect the temperature and pressure in the oil tanks,

sensors also detect the oil levels in the tanks and activate alarm in case oil level increase beyond

certain values. There is no need of a Master Unit or an RTU in this phase.

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7.3.d Technical processes in the oil refinery

Estimated cost in this phase for processing 2 million barrels of crude oil = 23,339,822 $

This is most important phase in the oil refinery where there is a much need of RTU’s and

the Master Unit. Each technical process needs at least 5 – 6 sensors in order to record the levels

in the reactors (as shown in Figure 24) and also for record the rate at which liquid flow in the

pipes between the reactors, each technical process needs at least one RTU in order to transmit the

recoded values by the sensors to the Master unit. This phase require a Master unit to control the

flow of liquids and to control the pumps and valves that are in this phase. There are 7 technical

processes in the oil refinery each requires an RTU and at least 5 sensors to monitor. Sensors and

RTU’s needed in this phase are 60 – 70 sensors, 7 -10 RTU’s and 1 MTU. (Shown in Figure 25)

Since huge amount is invested in this phase, SCADA system is much needed in this phase.

Figure 24: Example to show how many RTU’s and sensors needed for each technical process

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SCADA need in oil refinery

Phases of Oil

refinery Business

processes

Sub phases Number of

Sensors

needed

Number of

Remote

Terminal

Units (RTUs)

needed

Number of

Master

Terminal Unit

(MTUs) needed

1) Pumping Crude Oil 1 0 0

2) Crude Transportation

20 – 25 5 – 8 1

3) Crude Storage 1 0 0

4) Oil Refinery Initial Phase

Crude Distillation / Vacuum Distillation

15

67

2

10

1

5) Oil Refinery Intermediate Phase

Hydro treating 9 1

Coking 7 1

Fluidic Catalytic Cracking

3 1

Hydro cracking 11 2

6) Oil Refinery Final Phase

Isomerization 6 1

Catalytic Reforming 8 1

Alkylation 8 1

7) Product Storage 8 – 10 1 0

8) Marketing & Supply supply & Trading 0 0 0

Marketing & Distribution

0 0 0

Figure 25: Table showing how many sensors, RTUs and MTUs required for each phase in the

business process of an oil refinery

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Chapter 8

Conclusions and Future work

Before the development of the SCADA systems, we had to send people around the

refinery to close valves and turn on pumps at various times. This requires lot of effort and man

power. The use of SCADA systems became popular in 1960’s as a need to arise to more

efficiently monitor and control the state of remote equipment. A problem with early SCADA

systems is that they required human oversight to make decisions as well as human support to

maintain the information system. With the technology growing rapidly, the human intervention

in the SCADA system is becoming very low. Human Intervention is needed only for some very

rare events.

In this project we discussed about the business values and SCADA system, we also

simulated the business processes of an oil refinery by using Accuprocess simulator and calculate

the cost involved in the oil refinery. After that, we discussed about SCADA requirements in the

oil refinery, from the values produced by the simulation we determined the phase in the business

processes of an oil refinery where SCADA system is much needed to increase the profit-margins.

This system can be further developed to work on some other issues like the security

scenarios, profit-margins, or doing a little deeper research into the system and improving the

business values of the refinery.

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Chapter 9

References

[1] Business Process Improvement in Refinery by Christopher Fonseca - Practice Director,

Seshasai Kandrakota Practice Head – Energy Resource & Utilities for Tata Consultancy

Services,

http://www.tcs.com/SiteCollectionDocuments/White%20Papers/tcs_ERU_whitepaper_Business-

Process-Improvement-Refinery.pdf

[2] Business process From Wikipedia, the free encyclopedia.

http://en.wikipedia.org/wiki/Business_process

[3] Supporting the Business Process Lifecycle Using Standards-Based Tools by Bhagat Nainani

- product development manager, Oracle Application Server division

http://bhagatnainani.sys-con.com/node/79226/mobile

[4] The Importance of Business Process Improvement by Julia James

http://blog.businessmapping.com/2009/03/30/the-importance-of-business-process-improvement/

[5] SCADA - Wikipedia, the free encyclopedia

http://en.wikipedia.org/wiki/SCADA

[6] What is SCADA system? – VEESTAWORLD

http://www.veesta-world.com/pages/services_scada_page.htm

[7] SCADA Knowledge Base – DPS telecom http://www.dpstele.com/dpsnews/techinfo/scada/scada_knowledge_base.php

[8] PETROLEUM REFINERY: COMPLEXITY OF OPERATIONS AND THE NEED AND

SCOPE OF OPTIMIZATION – GLOBALSPEC

http://www.cheresources.com/refinery_planning_optimization.shtml

[9] Oil refinery - From Wikipedia, the free encyclopedia

http://en.wikipedia.org/wiki/Oil_refinery

[10] Oil Refinery Processes - A Brief Overview – www.processengr.com

www.processengr.com/ppt_presentations/oil_refinery_processes.pd

[11] Oil Storage at Record Levels as Speculators Await Higher Prices – Voice of America

http://www1.voanews.com/english/news/a-13-2009-01-23-voa61-68809857.html

[12] SCADA Applications – Data Flow Systems

http://www.dataflowsys.com/services/scada-applications.php

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[13] REMCO Engineering's – Water systems and Controls

http://www.remco.com/scada.htm

[14] Estimated 2010 Gasoline Price Breakdown & Margins Details - California Energy

Commission http://energyalmanac.ca.gov/gasoline/margins/index.html

[15] SCADA Systems for Oil & Gas Industry Worldwide Outlook Study Brochure [PDF] –

SCADA Systems for Oil & Gas Industry.

www.arcweb.com/StudyBrochurePDFs/Study_scadagas_ww.pdf

[16] SmartSCADA Package – Hometown Connections and Survalent Technology

http://www.hometownconnections.com/utility/scada.html