Power Plants of Turkish Refineries

Dear Colleagues,

In this article I would like to present my past site observations of my marketing visits to various sites of Turkish refineries for their new investments and/or rehabilitation works for existing units in their power houses. We shall start with Batman refinery, the least known by public.

In an International Marketing team, we visited Tupraş Batman Refinery on 8-9-10 April 1999. We had meetings with the Refinery Manager, his managers and their staff in operations, investments, maintenance, technical services, and purchasing.

Tüpraş Batman Refinery was in the first priority of immediate Privatization scheme. Vendor (Tüpraş) and purchaser (TPIC) already signed the preliminary documents for the transfer. Tüpraş asks 40m US Dollars, Privatization puts a figure around 20m US Dollars, whereby TPAO (TPIC) expects to purchase free-of-charge since it was free-of-charge in the past ownership transfer from TPAO to Tüpraş.

Post-refinery oil product prices are set by the public refinery Tupras and approved by the Government, and they do not always allow Tupras to recover its costs. As a consequence, investments by Tupras to improve the quality of oil products have been delayed. The sulphur content of oil products in Turkey are very high (7% in Batman Refinery) compared with other countries. The Government implemented a price formula to link oil product prices to international prices.

Tüpraş Privatization method is Trade sale on refinery basis. Implementation will be as per High Planning Council decision no. 91/2 dated 08 January 1991, the company shares were offered publicly. In this IPO 1.64 % shares were sold.

The privatization studies of Izmir/Aliaga, Izmit and Kirikkale refineries owned and operated by Tupras, were at that time in progress in coordination with the consultants. The intended strategy was to privatize the state shares of separate refining companies in block.

Batman Refinery Ownership transfer would be made to TPIC (TURKISH PETROLEUM INTERNATIONAL COMPANY LTD.) which was formed by employees/ retirees of TPAO and works in international projects, privatizations, and private procedures.

Pursuant to Resolution No. 88/13180 dated August 21, 1988, TPIC was established to carry out more efficient international operations for and on behalf of TPAO, and was officially registered in Channel Island Jersey (U.K.) on December 7, 1988.

The object of the company is oil exploration activities in abroad. The company was wholly owned by TPAO, and has a capital of US$ 3 million all of which is paid up.

Batman Refinery was designed and installed to refine low gravity (11-12) crude oil that is available in the nearby region, in Batman and Adıyaman oil fields. Refinery had approximately 1.1 million tons of crude refining capacity per year.

Profit break-even point is at 700,000 tons per year. Last year they had more than 800,000 tons of crude refining and the enterprise had profit. Their output was 20% white products (gasoline, diesel, naphtha) and remaining 80% black products (fuel oil, asphalt etc)

BATMAN produces 40,000 tons of naphtha per year as by-product of the refining process, keep some as emergency at their plant and inject the rest (25,000 tons) into Kerkuk- Ceyhan Crude pipeline to be transported to Tupraş Aliağa Refinery for refining once more. Therefore the naphtha produced was treated as Crude oil, in-and-out procedure. This is loss since it is assumed to be crude oil (17 USD per barrel as of 1999 or 70 USD per ton, whereby naphtha spot price was around 170 USD per ton)

We visited the powerhouse. All 7 boilers were in operation but need further maintenance and upgrading.

Boilers number 1-2-3 are B&W boilers built in 1955 at 420 psig 20,000 pph each,
Number 4 boiler is built by Deutsche Babcock
Number 5 is B&W FM.10-61,
Number 6 is B&W- FM.117-88
Number 7 is Stein, retubing by a local company,
Number 8 had blasted in operation and site is cleared. Not in operation.

First 3- FF-15 type B&W boilers were sold by B&W in 1954 to Ralph Parsons Co. in behalf of MTA Batman Public Company. Plant needs 30 tons of steam in summer time and 50 tph in winter, whereby their output capacity is 210 tph. Therefore they are quite comfortable in steam production, no rush no emergency they have.

Moreover they have one ABB (ASEA Stal) GT-35 gas turbine in simple cycle to generate 9-10 MW electricity, sitting idle since early 1980. It was in operation between 1970-1980 to serve nearby regions. Refinery itself has only 2.5-MW electricity consumption.

Since government introduces generous investment incentives for the region, local and international power developers may get interested in building new BOT/BOO type power plants in the empty refinery area.

During our meetings with our presentations and further to point-out our contribution; Refinery Management asked the following assistance,

1. In-plant Training at site for operators
2. Condition assessment if applicable, a sample document
3. Modernization facilities if applicable
4. Specification of damaged equipment, instruments to replace
5. FD fan controls to be replaced if applicable
6. De-sulphurisation of the available fuel oil by additives
7. Recommendations to operate existing idle GT-35 gas turbine,
how to sell to the main grid (5 US cents per kwh),
then further CCPP scheme application
8. Heat recovery for refinery furnaces (info will be supplied by Batman)
9. Better pricing in all proposals

Refinery sincerely and repeatedly asked if we could give In-plant operator training. We have similar training in the past for new boiler sales upon completion. Therefore we can repeat for the existing clients. They advised that Refinery Manager has purchasing authority upto 40 billion TL (approximately 100,000 USD). Tüpraş General Manager has 100-billion TL limit. Above that figure, the board was authorized to purchase. At that time since it would be privatized and sold to TPIC after national elections, Tüpraş board was resisting to any new investments. Therefore any purchase above 40-b TL threshold was rejected.

Our retubing proposal was not appropriate since it exceeds the limit; therefore it should be prepared in smaller packages and be presented in reasonable budget figures. We were told that the retubing request would be retendered in 2-3 packages and they expected us to quote reasonable figures.

Therefore upon receipt of retendering the previous retubing inquiry, we should quote in partials, one package for furnace and the other for SH, and come-up with a price slightly less than 2x40 billion TL , approximately equivalent of total 220,000 USD. Initial price was 317,300 USD.

As of year 1999, Batman Refinery was a peaceful, reasonable and secure place for work, although the city itself is in high anxiety of 18th April 1999 national elections at that time.

Petkim- Aliağa, site observations on 18th February 2000

Petrochemical Plant had 4 each Mitsubishi steam boilers each generating 350 tph at 150 bar 540C steam, oil fired to feed Steam Turbine Generators. Plant had 1x20MW back-pressure and 2x60 MW ABB-BBC steam turbines. In normal operation, 3 boilers were fired whereby the 4th was in stand-by. In year 1999 they had retubing in 2 of these boilers. Contractor was a local company who employed another local subcontractor to handle the necessary local works at site. Contract price then (1999) was 45b TL (approximately 200,000 USD) . In year 2000 sometime in summer, they were planning to retube the remaining two. We were advised to deliver our PQ files in order to be invited.

Tüpraş- Aliağa, on the same day

We had site visit and technical conversation on last cancelled boiler tender for 150 tons per hour MCR at 39 bar 440 degrees Celsius. Project will be retendered with scope extension to include necessary civil works and common concrete stack at 95m high. Their budget was around 5m USD. Moreover they had 3x100 tph plus 1x150 tph Mitsubishi steam boilers and 4x 75tph Russian built and 1x100 tph CO firing steam boilers in operation.

Steam Boiler details of other Turkish Refineries which we visited on various other time frames,

Atas Mersin Refinery had 3 each “115-VU-55” type, constructed by CE in 1961, field erected steam boilers each to generate 45 tons of superheated steam per hour at maximum continuous rate at 52 bar 425 degrees Celsius. Refinery is closed at this time due to unfavorable conditions of economics.

TUPRAS Kirikkale Refinery had 4 each constructed by Romanians in 1985, field erected steam boilers each to generate 120 tons of superheated steam per hour at maximum continuous rate at 100 bar 460 degrees Celsius. Boilers completed their economic life for further operation. They need rehabilitation desperately.

I hope that above information will help interested parties to enable them to make their further investment and future proposal works.

Non of these power plants are designed by local engineers however it is my sincere feeling and wish that soon in time, we shall be doing all necessary engineering/ fabrication/ site installation/ construction and smooth operation by our local engineering capability.

Your comments are always welcome