PTQ Q2 2025 Issue

group. This considers the lower cost of heavier crude oils vs the cost of processing that oil, particularly the cost of resi- due upgrading. For Arab Medium or equivalent crudes, the facility should be designed for a 40-45 wt% petrochemical yield. Arab Light or equivalent crudes should be pushed up to 50 wt% petrochemical yield or more. This will be demon- strated in the following two case studies. Crude-to-chemicals megaprojects face many challenges today. Although each project is unique in many ways, each with its own business drivers and hurdles, Fluor’s recent project experience has shown that there are common major challenges these projects need to overcome to reach a final investment decision (FID). This article will focus on the fol-

As such, the management of sourcing feedstock may be a challenge for some projects. Decarbonisation requirements Laws and regulations that will require the decarbonisa- tion of all industries will become more restrictive over the next decade and beyond. A project built in the near future may not need to consider this when starting up, but a path toward carbon neutrality3 should be developed in the design phase to be prepared for when it becomes a requirement to be carbon neutral during its operating life. A carbon neutrality roadmap may include engineering strategies, fuel switching, carbon capture, and carbon off- setting. A company may choose to position itself as achiev- ing net neutrality ahead of being required. A project may, therefore, require decisions in the planning stages, such as leaving space for carbon capture in the plot area near large emission sources or designing a fuel system that can be switched over to alternative fuels such as renewables or hydrogen 4, 5 in the future. Achieving investment-grade project The feasibility phases of a project necessitate thorough technical and financial evaluations to demonstrate the pro - ject’s viability to stakeholders. Reaching FID is the goal, but many projects get delayed for years or cancelled because they cannot demonstrate how the large investment is the right business decision for the owner. Strategies that have been successfully implemented to move projects through the front-end loading (FEL) phases toward achieving investment grade are further discussed. The first strategy is feedstock advantages. Capitalising on a low-cost feedstock can be a key driver towards prof- itability. For crude-to-chemicals projects, the cost of crude oil is a significant portion of the operating costs of the facil - ity. Other feeds sourced from outside of the crude refining section of the project should also be considered. The mixed feed steam cracker used for producing ethylene can be fed by other external feeds, such as ethane, liquefied petroleum gas (LPG), naphtha, or even gasoils. If a reliable, low-cost feedstock source can be found, it can strongly promote a project’s profitability. The second strategy, on the other side of the complex’s operations, is product market advantages. Shipping prod- ucts over long distances can cut into profits quickly, espe - cially for commodity products in a competitive market. Being able to supply local markets can improve profitability. Also, producing specialty chemicals with niche markets that offer high margins to the complex will boost profits. Entering new markets can be challenging. A detailed study of the past market performance to forecast the market size and price structure in the future should be completed early in the project and updated as the project progresses. This market study needs to be location-specific as demand and prices for any product may vary based on the location. The third strategy is finding the optimised configuration. Refineries and petrochemical facilities can produce many different products, which may have different specifications and grades that can be considered for the production plan.

lowing challenges: • Investment size • Land availability • Feedstock cost • Decarbonisation requirements. Investment size

These large, complex projects require numerous world- scale units, which are capital-intensive. Consequently, the overall project will have a substantial price tag to achieve the desired petrochemical yields. Finding ways to manage investment size is a key challenge for any project, especially for crude-to-chemicals megaprojects. Strategies such as fit-for-purpose designs, no pre-investment in future facili - ties, phased execution, and engaging joint venture partner- ships to offset the large investment by a single owner are imperative for such megaprojects to move past the feasi- bility stage. Land availability Another common issue is land availability and the permit- ting requirements that go along with it. Again, due to the complexity and size, crude-to-chemicals projects require a large plot of land. They also need reliable services such as power and water supply; otherwise, the facility will need to invest to supply their own. There are a few pathways that can be taken. New land development allows a project to start with a clean plot. However, land development pro- jects are often slow, which will push out the start-up and construction timelines, possibly beyond what is desired by the project owner. The price tag to develop the land and provide common services is also an obstacle. Alternatively, a project can try to find space in an existing development. However, again, the amount of space needed can make finding the right plot difficult or require the plot to be split over two or more locations, which increases the cost even more with the need for additional pipelines between multiple locations. Feedstock cost The cost of feedstock is one of the largest expenses for a crude-to-chemicals facility. Additionally, feedstock availa- bility may pose a challenge. Building a project where there is readily available feedstock is optimal, but that may not always be possible. In contrast, it may make more sense to locate a project where the product users are located.

PTQ Q2 2025