SAPIA Avhapfani Tshifularo Current Refinery Production of LPG in South Africa

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Use of LP Gas is likely to grow at 30% per annum in South Africa and with current supply under strain during peak times and with unplanned refinery shutdowns this fuel source could become problematic. This event will help manufacturers and users of LPG to understand what challenges they will be facing in the medium term to enable informed decisions to ensure a continued supply of LPG.

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SAPIA Avhapfani Tshifularo Current Refinery Production of LPG in South Africa

  1. 1. Current Refinery Production of Liquefied Petroleum Gas in South Africa 14 March 2012
  2. 2. Presentation outline2. Facts and Figures3. Capacity of South African refineries4. Refinery shutdowns5. Demand6. Changes in the LPG market7. Conclusion
  3. 3. Facts and Figures Liquefied Petroleum Gas (LPG) was found to have higher efficiency than natural gas-fuelled distributed power generation which makes it ideal for rural homes and businesses LPG is extremely versatile and portable. It can be transported using sea, rail or road transport. LPG is available in a wide variety of packaging and storage options and is available in even the remotest of areas LPG is a naturally occurring by-product of natural gas extraction (60%) and crude oil refining (40%) – therefore we either use it or it is wasted LPG emits about 20% less CO2 than heating oil and 50% less than coal
  4. 4. Capacity of South African refineries• Note:• This is nameplate capacity and refers to crude intake. Actual crude usage is dependent on individual refinery operating conditions.• Further, a refinery produces between 60% and 70% petrol and diesel
  5. 5. Refinery shutdowns1. Planned refinery turnarounds They are major maintenance or overhaul activities Done every 3 to 5 years Requiring 1 to 2 years of planning and preparation, and sometimes longer when major capital equipment changes are required Last about 20 to 60 days2. Planned shutdowns They are planned and smaller scope than a full turnaround Require about 2 to 6 months in planning and preparation Outage may last 5 to 15 days
  6. 6. Refinery shutdowns They can also result in unplanned outage time if other problems are discovered that may extend the time offline3. Unplanned shutdowns Unexpected, but do not require immediate emergency actions Even well maintained refinery systems develop unexpected problems Unit may continue operating for a time, about 3-4 weeks, providing some room for planning Unplanned shutdowns are often prolonged due to manufacturing and shipment delays of parts and equipment.
  7. 7. Refinery shutdowns4. Emergency shutdowns The occur when a unit or entire refinery must be brought down immediately without warning A fire or power outage could create such a shutdown requirement Severe weather conditions may also require emergency shutdowns until the weather danger is past Emergency shutdowns can present some of the largest safety issues, and increase the potential for mechanical damage as a result of the fast shutdown.
  8. 8. Refinery shutdowns5. General Restarting a unit that has been offline can be more difficult than anticipated, resulting in unplanned outage time The unit may have to be brought down several times before it is able to run steadily at full operation In all shutdown cases, when major fuel-producing units are offline, production of LPG may be reduced.
  9. 9. Liquefied Petroleum Gas demandLiquefied Petroleum Gas demandDemand for LPG has increased by 13.5% from 2009 to 2010
  10. 10. Changes in the LPG market Worldwide sale of LPG businesses by International Oil Companies (IoCs) IOCs strategy focusing on a smaller number of assets and markets Opportunities for new entrants especially Black Economic Empowerment Entities Mergers could boost Black Economic Empowerment foot print
  11. 11. Conclusion New entrance opportunity to grow the LPG businesses Improvement in refinery performance will improve LPG availability Regulations to incentive production and importation of LPG are urgently required Opportunity to contribute to clean energy agenda

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