Goodbye California

Hello,

Well, I have now returned to Arizona after an all around great experience in California.  I learned so much about the industry I hope to enter, insight into the possible major I will choose, and of course, how to optimize refineries.  In this post I will go over the general aspects of optimizing a refinery, and go into specifics in the upcoming weeks.

So first off I feel it would be good to clear some misconceptions about the oil industry that plays into my research.  The largest one is that oil is quickly becoming more scarce and that it has a huge effect on the market.  Any changes to scarcity are happening slowly and does not really change the market all that much.  If there are any changes in scarcity, it is that over time the quality of the crude oil being processed has decreased (I will go into this more later).  Another misconception, related to the scarcity one, is that there is going to be more money in oil sooner rather than later, because the scarcity will cause the price to increase.  In reality, the oil market is cyclical, and highly dependent on a variety of factors.  

Anyways, onto the optimization.  Refineries are optimized to reach the highest level of economic efficiency as possible.  This means that it is very common that over time refineries try to invest in units that take lower end products and make higher end products.  An example of this would be using products that would normally go into asphalt, and making gasoline products from them.  There are little to no waste products from refineries, it’s just the value of the product and which product is being produced that is optimized here.

Another area of optimization for refineries is that of energy usage.  They are designed to avoid wasting energy throughout the process, and to try to use heat from the process that is needed elsewhere in the process to try not to waste that energy.  In many ways, heat is often the highest area of waste and could be where future changes are made.

Environmental concerns are also playing into the industry.  As legislation is passed to decrease emissions, refineries are forced to implement units that will help them meet the specifications.  The most common form of this is decreasing sulfur levels in fuels.  There have been huge advancements here in the past few decades, and as more legislation is being passed throughout the United States and the world as a whole.

Anyways, that’s the brief overview.  I will go into more detail in the upcoming blog posts.

Stephen