CRU Nitrogen + Syngas 2021

CONFERENCE

CRU Nitrogen + Syngas 2021

Because of the ongoing pandemic, this year’s CRU Nitrogen + Syngas conference was held as a ‘virtual’ event, in early March 2021.

CRU’s annual Nitrogen + Syngas conference is one of the annual fixtures on the calendar for those industries, and while covid continues to make travel impossible, this year’s virtual event provided a good mix of interesting papers with question and answer sessions and interaction with virtual exhibitors and attendees. Some of the highlights follow.

Markets

As usual, the conference kicked off with the nitrogen industry overview, this time presented by CRU’s Alexander Derricott. Both ammonia and urea have weathered the covid storm relatively well. Urea demand was up around 5.7 million t/a during 2020, with notable increases in India, China and Australia and production increases seen in Russia, China and Indonesia, offset by falls in Malaysia and Europe. Fertilizer demand has held up well, as governments decided agriculture was a key strategic resource, though technical demand fell. Urea trade reached 51.4 million t/a, but prices have remained weak, continuing the low level they have maintained since 2016, with new capacity generating oversupply. The collapse in feedstock prices seen in 2020 have also kept price floors low, although there has been a spike in LNG prices in early 2021. Moving into 2021, crop prices have jumped, with Chinese soy and corn demand high to rebuild swine herds decimated by disease. Good crop prices have encouraged farmers to buy more fertilizer. A wave of new urea capacity in 2021-22 (albeit some delayed due to covid) will probably keep a lid on prices for this year at least, but looking further ahead, the demand outlook is robust for both ammonia and urea, with total nitrogen demand rising to 167 million tN/a by 2025, and this is forecast to roughly balance new capacity rises, depending upon the rate of Chinese capacity closures. A rebound in energy prices will see costs rise, even in some countries that currently fix gas costs for fertilizer producers, and as utilisation rates rise so prices should also rise.

Looking to the longer term, Alexander said that the nitrogen industry has a CO2 challenge. There is an increasing focus by companies and governments on environmental, social, and corporate governance (ESG) issues. There is a major emissions difference between gas and coal-based production – the latter emits much more CO2 . There are a number of options for decarbonising ammonia, which are discussed in much greater detail below and elsewhere in this issue.

Alexander was followed by his CRU colleague Arham Muhammad, who looked upstream at natural gas pricing – a key determinant of ammonia and urea pricing. The cold weather this winter, especially in the US, have contributed to a major LNG price spike. January’s reduction in output came together with supply outages in Australia, Malaysia, Qatar, Norway, Nigeria, and Trinidad. Most countries secure 70% of their LNG requirements on long-term contracts – this means that when the market is tight, spot volumes may not be available quickly and prices can spike rapidly. The LNG market has been oversupplied for a few years, exacerbated by demand falls early in the covid pandemic. However, there are now signs that we are moving into a market where net demand growth is outpacing new capacity additions.

Low carbon ammonia

For the rest of Monday, several papers presented the views of major licensor companies about low carbon ammonia production. Klemens Wawrzinek of Linde began with a look at ‘blue’ hydrogen production. Hydrogen will play a key role in the transition to cleaner energy, with 2018 demand of 118 million t/a likely to double by 2030 and multiply tenfold by 2050. The EU’s CertiHy certification scheme defines blue and green hydrogen as anything with less than 36.4g of CO2 emissions per MJ of hydrogen (LHV) – or about a 40% reduction in carbon intensity of production compared to conventional ‘grey’ hydrogen. It is unlikely that sufficient electrolysis capacity can be built to satisfy projected H2 demand. There are therefore a number of ‘blue’ pilot carbon capture projects around the North Sea using depleted oil and gas reservoirs to house CO2 . Klemens presented a case study using several flowsheets – conventional (both reforming and partial oxidation), partial carbon capture and full carbon capture, and an electrolysis comparison case. Even generating hydrogen from green electricity has some CO2 emissions, and the figures showed that these were comparable with a reformer using full, flue-gas CO2 capture, while the latter had only 60% of the cost per tonne of CO2 emissions avoided, and the lowest unit production cost of H2 for any low carbon option, unless power is available at very cheap cost.

Michael Reinke of Linde moved on to green ammonia production. Linde has joined with PEM manufacturer ITM Power in ITM Linde Electrolysis to produce modular electrolysers. At present modules are 2MW, but a 5MW module will be available from 2023. It has also developed FLEX-ASU, an air separation unit optimised for cyclic operation that can vary its output from 30-100% production for use with electrolysis based ammonia production. Various buffer technologies can also be used to smooth output – electric grid export, battery storage, and ammonia or hydrogen storage either as a liquid or gas.

Klaus Noelker of thyssenkrupp Industrial Solutions noted that use of ammonia could also double by 2050 if it becomes widely adopted as a marine fuel. He focused on ‘green’ ammonia, via electrolysis. The challenge is to match fluctuating power input with the requirement for stable chemical production, without over-specifying equipment sizes. TKIS has a modelling tool called RHAMFS which can specify the optimum sizing of the synloop and hydrogen storage buffer for any combination of circumstances. Green ammonia plants also have less steam from waste heat available to drive syngas compressors. Smaller plants can reduce capex by using waste heat for absorption refrigeration, and driving compressors using electric motors, while larger scale electrolysis plants can reduce opex by feeding the steam to a generator turbine. Existing plants can be retrofitted with additional green hydrogen side streams, but steam balance issues must once again be considered. Cost-wise, the key determinant of the viability of the plant is the cost of green electricity supply. A cost of $15/MWh or less is needed to make the plant cost competitive, although a $30/tCO2 e carbon price on CO2 emissions would raise that threshold to $20/MWh.

Yawar Abbas Naqvi presented Haldor Topsoe’s approach to a lower carbon economy. The company has set itself the strategic goal of being recognised as the global leader in carbon emission reduction technologies by 2024. Topsoe sees hybrid plants where only part of the feed is replaced by electrolysis as a bridge towards full decarbonisation. Our world also requires carbon chemicals for plastics and other materials. Green methanol can be a low carbon carbon source, converted downstream into DME, gasoline, polyolefins etc.

Francisco Baratto showcased Casale;s green and blue hydrogen and ammonia technologies, though he also added ‘red’ ammonia (hydrogen electrolysed using nuclear electricity) and ‘turquoise’ ammonia to the colour palette, where pyrolysis is used to generate ammonia and solid carbon that can be sequestered. Casale have developed its A6000CC process for blue ammonia applications, using pre-combustion carbon capture to reduce the energy penalty while achieving 90% capture. It is an autothermal reformer based process. Hydrogen rich process gas is used to generate heat for the CO2 capture section. One such plant is under construction in Russia using an MHI CO2 removal license. It can also be used as a revamp for an existing plant, or adapted for blue hydrogen production. On the green ammonia side, Casale’s A60 and A600 processes are geared towards green ammonia production, designed for smaller scale highly automated production. System optimisation uses a software tool to reduce the cut-off of renewable power (i.e. when hydrogen storage is too full or when generation is too low and backup power must be used). Having a flexible synloop that can work from 10-110% capacity is the key to the system, and lowers ammonia production cost by 15%. Once again, green hydrogen can be used in hybrid plants.

Technology

Some of the technology showcased at the conference included the ActiSafe catalyst handling system, described on p48, Navigance’s data-driven analytical system, described on pp54-57, and some of the efficiency improvements available for urea plant operators that can be found in our article on pages 28-40 this issue.

Martin Østberg of Haldor Topsoe introduced a novel CO2 reforming technology for production of CO-rich synthesis gas at a low steam:carbon ratio, designed for use in conjunction with carbon capture technologies.

OMNI Conversion Technologies has developed the Plasco gasification and plasma refining system (GPRS) for the production of clean chemicals from waste. Martin Bacon described the process, and said that OMNI has now developed a 200 t/d modular gasification system with high reliablility (92% availability) which can be installed in parallel streams for scale-up.

On the environmental side, René Braun of Grandperspective GmbH described the installation of an early warning solution for gas leaks at OCI’s CHEMELOT facility in the Netherlands, while Andrea Carotti of Saipem presented a new electrochemical wastewater treatment technology for emissions abatement. BD Energy Systems described the successful installation of a selective non-catalytic reduction (SNCR) system for NOx emissions reduction in a steam reformer. Alessandro Gullà of AWS Corporation presented an electrostatic precipitation system for dust control in AN/ CAN plants.

Catalyst presentations covered the first commercial references of Clariant’s ReforMax® LDP Plus series and associated reformer service ReforSafE™ ; operating ShiftMax reforming catalyust under harsh conditions; computational fluid dynamic modelling by TKIS and Umicore to improve ammonia oxidation catalyst design; Johnson Matthey looked at the impact of catalyst size, shape and strength on performance, and the decisions that had led to the development of its F-series catalysts.

Operator experiences included a case study from PT Kaltim Parna Industri in Indonesia on incident management of natural gas pipe leaks; the structural rehabilitation of a wooden cooling tower at Engro Fertilizers Pakistan; life extension of two bimetallic strippers by Iffco in India; and improving energy efficiency and resolving a performance decline in a KBR Purifier-based plant by PT Petrokimia Gresik.