Learning Reminder

Overview of Emerging Energy Markets (ETNL-P)

Crude oil
Factors affecting crude oil prices
Supply / demand
Political issues
Quality
o Hydrocarbon sizes and types
o Density / API gravity light, heavy
o Impurities e.g. sulfur sweet, sour

Netbacks

GPW = yields x refined product prices

Netbacks = GPW (transportation, insurance, finance, operating costs fixed & variable)
Netback margin = netback crude price

Refined product types

Gases, gasolines, middle distillates (diesel, heating oil, jet, kerosene), residuals (fuel oil,
asphalt), specialty products (e.g. waxes, lubricants, petroleum coke), intermediate products
(e.g. naphtha)

Flexibility

Maximise crack spreads

Initial distillation cut points
Swing capability e.g. maximum gasoline, maximum distillate operating mode

Capacity

Primary distillation capacity BPCD, BPSD

Secondary / upgrade / conversion capacity
Service / operating factor
Turnarounds
Plant reliability and performance

2013 The Oxford Princeton Programme, Inc. All rights reserved.

Learning Reminder

Complexity
Simple
Topping configuration = atmospheric distillation unit
Hydroskimming configuration = Topping units + catalytic reformer + hydrotreater
Nelson index 2 5
Complex
Configuration = Hydroskimming units + catalytic cracker + alkylation
Nelson index 8 12
Very complex
Configuration = Complex units + hydrocracker + coker
Nelson index 13 15

2013 The Oxford Princeton Programme, Inc. All rights reserved.

GLOSSARY

Introduction to Refinery Economics (IRE)

API Gravity
Assay
Catalyst
Crack spread
Cut point

GPW

Heavy crude
Middle distillates

MTBE
Light crude
LP model

Nelson complexity index

Netback

Octane rating

A gravity scale defined by the American Petroleum

Institute
A laboratory analysis of crude oil quality
A substance that assists a chemical reaction, but is not
chemically changed in the process
The price difference between a refined product and
crude oil
The temperature limit of a crude fraction that is the
portion of crude that boils within certain temperature
limits
Gross product worth, calculated by multiplying the
refining yields for a particular crude by the market prices
for each product.
A crude oil with a high proportion of heavy hydrocarbons
and a low API gravity
Products produced from the middle of the crude
distillation tower. The main middle distillate products are
jet fuel, kerosene, diesel and heating oil
Methyl tertiary butyl ether an additive used to enhance
the octane of gasoline
A crude oil with a high proportion of small hydrocarbons
and a high API gravity
A type of computer model which is frequently used by
refineries to calculate the optimal refinery configuration
in order to maximize margins
An index devised by Wilbur Nelson, designed to measure
the complexity of refineries
An estimate of the value of crude oil based on the value
of refined products that can be derived from that crude
oil, less the costs involved in transporting and refining it
A measure of the fuels resistance to knocking. Knocking
occurs when the fuel ignites at the wrong time during the

2013 The Oxford Princeton Programme, Inc. All rights reserved.

GLOSSARY

Primary distillation
Secondary distillation
Sweet crude
Sour crude
Yields

engine cycle
The separation units within a refinery typically the
atmospheric and vacuum distillation units
The conversion or upgrade units within a refinery
A crude oil that contains low levels of sulfur, typically less
than 0.5% by weight
A crude oil that contains high levels of sulfur
The amount of products produced from refining a
particular type of crude oil

2013 The Oxford Princeton Programme, Inc. All rights reserved.