Synergies between Refining and Petrochemicals : Today and Tomorrow

Contribution to the work of the High Level Group for the European Commission by Total Raffinaderij Antwerpen, February 29th 2008

Synergies between Refining and Petrochemicals

Refining / Petrochemicals integration :
Background Within the Total Group The Antwerp example

New developments :
Market trends Longer term strategy and developments

Refining / Petrochemicals Integration

Refining / Petrochemicals process links

Condensate splitter
Distillates Naphtha Butane Fuel Gas, PFO Propylene Hydrogen Butenes Gasolines Benzene fraction C7 / C8 Aromatics Naphtha

Ethylene Propylene

Steamcracker

Refinery

Butadiene Py Gas Benzene Toluene

Aromatics

P-Xylene O-Xylene

Refining - Petrochemicals integration within TOTAL

Vlissingen Port Arthur Gonfreville Dunkirk Antwerp Leuna

Grandpuits TOTAL Refinery Donges Feyzin

Carling

TOTAL Petrochemicals Steamcracker 100 % third party Steamcracker

Lavera

Benefits of integration
Single site integration of refining and petrochemical capacity :
Availability of product Reduction in transport (costs and risks) Working capital savings Synergies from joint infrastructures and logistics Reduction in variable costs (steam, utilities) Size effect on support services: maintenance, HR, HSEQ management, F&A, etc.

Strategic advantage :
Less recourse to trading market Independence and supply security Long-term exchanges Common business and investment strategy Commingled footprint of activities

Consolidation of production for both sectors

Chemicals percentage in Refining sales Naphtha percentage from TOTAL refineries used as feedstock in TPA steamcrackers

3.1%

1997

36 %

6.4 %
2001

60 %

7.2 %
2003
2

67 %

A common approach
100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%

90% 74%

39% 24%

BP

Shell

Total

Exxon Mobil*

Level of integration between Refining and Petrochemicals in Europe

Source: Morgan Stanley (% of ethylene capacity integrated with refinery owned by same company) * Exxon Mobil including ethane and LPG steamcracker from Mosmorran
19 20

The Antwerp example

Total in Antwerp

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Total Raffinaderij Antwerpen (TRA) Key figures

Crude + condensate capacity Staff (incl. NC3) Shift Personnel Contractors (outside Projects & TA) EDCI (Solomon) Refinery NC3 Naphtha throughput (in 2006) Surface area Storage tanks & capacity 31 process units - 1 central control room Power station + cogeneration 18 Mt/y 1,026 48 % 450 m/d 3.84 Mb/d 1.4 Mt/y 220 ha 162 - 2.1 Mm3

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Total Raffinaderij Antwerpen Production scheme

Separation / Distillation Reaction / Conversion Purification Blending
LPG Ethylene
Naphtha Cracker

Propylene

Benzene Xylene
Aromatic Extraction Catalytic Reforming 60.000 bpsd
Crude Oil Crude Oil

Jet Fuel
Kero Merox 27.000 bpsd

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R A P L

Atmospheric Distillation CDU3 & 4: 360.000 bpsd

Gas Oil
Catalytic Desulphurisation HDS1 - 4: 120.000 bpsd

ETBE unit (Ethyl Tertiary Butyl Ether) Alkylation 16.500 bpsd Atmospheric Residue Desulphurisation ARDS: 96.000 bpsd Clean Gasoline 57.000 bpsd

Gasoline

Catalytic Cracking FCCU1 & 2: 100.000 bspd

Fuel Oil
Visbreaker

Bitumen
Vacuum Distillation

Total Petrochemicals Antwerp Site : FAO

NC1: 1967 Cracker Capacity 240 kt/y High Butane Flexibility NC2: 1968 Cracker 2003 Revamp Capacity 470 kt/y

NC3: 1991 Cracker 1998 Revamp Capacity 600 kt/y Operated by TRA

Extra terminalling capacity: 700 kt Olefins in 2006 Joint venture with ExxonMobil (35 %) Number of personnel: 640 own personnel + 350 contractors

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Antwerp logistics integration

Rotterdam

THE NETHERLANDS
Moerdijk (Shell) Marl

GERMANY North Sea

Terneuzen (Dow) Duinkerken TRN

R ijin
Gelsenkirchen (Veba)

Antwerpen
TRA, FAO, TPA Geleen (DSM)

Gent
Oleochemicals Lubricants Brussels

Beringen Lige

Keulen (Erdoelchemie)

Frankfurt

Feluy
TPF, TPR

Jemeppe (Solvay)

FRANCE
Ethylene Propylene Oil products Crude oil NATO
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Cambrai Ludwigshafen (BASF)

LUXEMBURG

Antwerp: Refinery and Petrochemicals Complex

butane, naphtha, propylene from FCC, aromatics from reformer

Antwerp Refinery

Antwerp Petrochemicals Plant

hydrogen, steamcracker gasoline, PFO, C4 raffinate, hydrogen, fuel gas, utilities

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Total Antwerp Sites Synergies

Synergies :
Common Shared Services: IT, Purchasing, Finance Close cooperation: HSE-Fire department, External Relations Mutual technical support: Naphthacrackers Waste water treatment NC3 Operations by Refinery

Opportunities further integration

Energy optimisation Feed optimisation Market adaptation

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New developments

Growth in Petrochemicals
8
7,9 7

8 6
4,0 4,3

8,3 7,1

ETHYLENE
6 4 2 0
W.EUR. N.AMER. ASIA+ME WORLD
1,8 1,9 1,5 1,6

PROPYLENE
4,7 4,7

4
2,6 2,9

2,9 3,0

2 0
W.EUR. N.AMER. ASIA+ME WORLD

% yagr 1997 - 2002 % yagr 2003 - 2008

Olefins : - Growing markets: 1.5 to 2 x GDP - Mixed evolution depending on geographic region Propylene : - Growth higher than for ethylene - Increased recourse to refinery productions in Europe and USA

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Growth in Petrochemicals
8
BENZENE

8
6,5

7,8

P XYLENE

6,7 6,2 6,2

6 4
2,7

5,7 4,5 3,9 3,5

6 4 2

5,0 4,2

2 0

1,8 1,1

0,1

0
W.EUR. N.AMER. ASIA+ME WORLD
% yagr 1997 - 2002 % yagr 2003 - 2008 W.EUR. N.AMER. ASIA+ME WORLD

Aromatics : mixed growth depending on the products Paraxylene : strong demand requiring recovery from refining flows

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European demand for petroleum products

Technological progress of motor engines Tax advantage maintained for diesel CO2 issue favourable to development of diesel motor engines

210 190 MT / year 170 150 130 110 90 70 50 2000 Gasoline

20

2005 Diesel Heating oil

2010 Heavy Fuel

Common strategy and objectives :

To fulfil the latest product and environmental specifications To adapt productions to market trends
Gasolines Olefins

Distillates

Aromatics

Refinery

Petrochemical site

Stringent capital expenditure policy Minimising production costs: Utilities, logistics

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Consolidating integration :

Gasoline
Extraction of aromatics Common desulphurisation of gasolines from FCC and steamcracker

Olefins
Alternative feedstocks New catalysts and processes FCC operation

Naphtha and feedstocks

Cracking of FCC gasoline Maximum production of naphtha

Hydrogen
Joint management of hydrogen productions

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Conclusion :
Refining / Petrochemicals Synergies : Integration already significant Competitive & strategic advantage

Ongoing strategy over next few years : Implementing new operational synergies Capital & research expenditure synergies to adapt to the markets Consolidating integration (capex, exchanges, new projects)

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