I’d Like To Buy The World A Coke – Why Aluminum Producers Rely On Crude Refiners

Petroleum coke (known as petcoke or “coke”) is produced by refinery coker units that break up residual fuel oil to squeeze out the last drops of lighter components used to make gasoline and diesel – leaving a solid carbon based residue. Petcoke is also the only commercial source of material used to manufacture electrolytic anodes that play a critical part in making aluminum. As a result – these industries are effectively joined at the hip - although you wouldn’t know it because the two rarely cooperate. As we explain in today’s blog - that may need to change going forward because a looming petcoke shortage could disrupt aluminum production and prices.

This blog series is based on the recently published “Alliance Anode Coke Study” prepared by Turner, Mason and Company, AZ China Ltd and Cascade Resources. For more information about the study please contact jauers@turnermason.com

How Is Aluminum Made?

For those of you wondering why RBN Energy’s blog would suddenly veer off into the world of metals and in particular aluminum – tighten your seat belts and bear with us while we explain the relationship between crude oil and aluminum. Aluminum is almost exclusively made using the Hall-Heroult electrolysis process where electricity at very high currents is passed through a molten electrolyte containing dissolved alumna (a compound of aluminum and oxygen produced from bauxite) at around 960 oC (1,760 oF). The alumina is reduced to its component parts – with the aluminum accumulating in reduction cells on one electrode (the cathode that transmits the current). The other electrode (the anode) is comprised of multiple blocks of carbon – typically around 1 metric tonne (MT) in weight – suspended in the electrolyte. These anodes are primarily manufactured from petcoke as well as a pitch based binder. The anodes are consumed during the electrolysis by reaction with oxygen to form CO2. Around 0.4 to 0.45 MT of carbon anode are consumed to produce 1 tonne of aluminum metal. Bottom line – you need about half a tonne of petcoke to make a tonne of aluminum. Who knew?

State of the Energy Markets, October 28, 2015

Hyatt Regencey Convention Center, Denver, Co

What is going on in today’s markets for natural gas, NGLs and crude oil, why it is happening, and what is likely to happen next?

More information about State of the Energy Markets here!

 

Anode Grade Petcoke

Refineries produce petcoke in a delayed coking unit (DCU) – commonly referred to as a coker. The primary purpose of the coker is not to produce petcoke but rather to upgrade residual fuel oil produced by upstream units in the refinery into lighter, more valuable components such as naphtha and distillate that can be treated to make gasoline and diesel (see Refining 101 for more on complex refining processes). Only the most sophisticated refineries have coker units and since they are used to upgrade fuel oil – refineries that have these units tend to process heavy crudes that have a high residual fuel oil yield after primary (atmospheric) and secondary (vacuum) distillation. The coker unit thermally cracks (breaks apart with heat) the large fuel oil molecules into smaller molecules to make gasoline, diesel and other products. The schematic in Figure #1 shows the process. The fuel oil feedstock is heated first to 482 oC (900 F) by the furnace and then introduced into the coke drum (the cracking doesn’t start until it gets to the coke drum – hence the term “delayed” coker – if you were wondering). As the heavy molecules fracture, the lighter molecules vaporize and exit through the top of the coke drum and are split into components in the fractionator. The liquid yield from a coker is typically around 70-80% of the fuel oil feedstock volume. As a side reaction single carbon atoms break apart from the larger molecules to form petcoke. Being a solid the coke gradually fills the coke drum. When full the heated fuel oil stream is diverted to a second drum and the coke is removed from the first drum. Now you know.

To access the remainder of I’d Like To Buy The World A Coke – Why Aluminum Producers Rely On Crude Refiners you must be logged as a RBN Backstage Pass™ subscriber.

Full access to the RBN Energy blog archive which includes any posting more than 5 days old is available only to RBN Backstage Pass™ subscribers. In addition to blog archive access, RBN Backstage Pass™ resources include Drill-Down Reports, Spotlight Reports, Spotcheck Indicators, Market Fundamentals Webcasts, Get-Togethers and more. If you have already purchased a subscription, be sure you are logged in For additional help or information, contact us at info@rbnenergy.com or 888-613-8874.