CRUDE OIL BLENDING Class # 2075 Kevin B. MacDougall Husky Energy Inc.

Box 6525 Calgary, Alberta Calgary, Alberta Canada Introduction There are a number of applications that require blending of crude oil or other hydrocarbons and they include transportation needs, pipeline capacity, product value and refining efficiency. Crude oil blending is accomplished by two methods: on-line blending and tank blending. On-line Blending In this method two or more components are injected from separate pipelines and are mixed in a single line. Ensuring adequate mixing is a necessity and often requires some type of in-line static mixer or mechanical mixing device. The use of piping elements alone may not provide adequate mixing. The efficiency of this method will depend upon the resulting streams Reynolds number, the type and number of piping elements, and the time allowed for mixing. With either method, the use of an injection quill for the smaller of the two streams will assist in mixing. Often only the smaller streams flow rate is varied whereas the larger is kept constant. The ratio of the two streams depends upon a controlling parameter that is monitored downstream of the common injection point. Such monitoring can be performed automatically using on-line analytical equipment or manually by collection of samples. The manual collection method can provide a semi-automatic operation at best. The injection rate of the smaller stream is based upon the sample analysis. An improvement in this application would be a ration control system where the flow rates of both streams are measured and the analysis from the manual sample determines the setpoint for the ratio. This is beneficial where the flow rate of the larger stream tends to vary. Tank Blending Components are added in a common tank and the concentration of the two is based upon a recipe approach. Achieving homogenous blending is difficult and depends upon the ratios of the two components, similarity in physical properties, size of tank, number of tank mixers and mixing time. Preference is to add both components simultaneously as the tank is filled rather than filling with one at a time. If the only available option is to fill with one at a time, the component with the lowest concentration is added first. There are a large variety of tank mixer configurations that can be customized for specific applications. Tank manufacturers and vendors may have simulation and sizing programs that can be used to select the proper mixer for an application. Obtaining representative samples from tanks can be difficult at best and often impossible which is another reason why tank blending uses a recipe style operation. The upside of a recipe approach is lower capital cost requirements; quite often, existing equipment can be used. The downside is potentially less homogeneity and less certainly in meeting proper specification, as there is no process feedback until the blending is complete. Transportation The efficient movement of crude oil is dependent upon its physical properties such as density, temperature and viscosity. For any given size of pipeline, a crude oil with a lower viscosity and density will have lower horsepower requirements and higher throughput capabilities than a crude oil with a higher viscosity and density. Fluid density has a direct impact on the horsepower required whereas the viscosity will impact the pipe capacity by affecting the pressure drop along the pipeline. Pipelines must operate below a MOP or maximum operating pressure that they were designed and licensed for. If the pressure drop in a given line increases due to increases in viscosity, the flow rate must be reduced to

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maintain pressures below the MOP. The alternative is to increase the pipeline line size which has both capital and maintenance costs associated with it. Blending a lighter crude oil or diluent with the crude oil that is to be transported can reduce the resulting blended crudes viscosity and density. As a rule of thumb, the lighter the crude oils density, the lower the viscosity. This rule also applies to most diluents but there are some exceptions and therefore not all diluents are equal in the sense. Two different diluents may have the same density but have different viscosity characteristics. The following are some of the considerations in determining the diluent requirement for blending: a) Amount of diluent needed to reduce the viscosity to the optimum level. A series of blended samples will be prepared in a laboratory to confirm the ratios of the diluent and crude oil stream. b) The price difference between the crude oil and the diluent. The goal may be to provide sufficient diluent to reduce the blended crude oils viscosity but he cost of the diluent may make such blending prohibitive. Quite often the monetary value of the products are assigned starting lowest with the crude oil and highest with diluent. The resulting blend is priced somewhere in between the two. c) Availability of the diluent. Refiners prefer a consistent stream quality, large swings can create havoc on their processing units and as a result the stream may be devalued accordingly. d) Cost to install the optimum size pipe. Larger pipe sizes require increased capital commitments and potential lower operating costs for energy (less horsepower) to move the oil. Blending may allow for a smaller pipe size and still provide reasonable energy costs. e) Efficiency of the pumping equipment can have significant impacts on the overall systems energy usage. For large flow rates, most pipelines companies will use centrifugal pumps. Increase in the fluid density can reduce the efficiency of this style pump. Blending Methods Determining the ratio of diluent crucial. The laboratory analysis of the blending test will likely include a three-point viscosity curve and density analysis at standard conditions, all for a variety of concentrations of the crude oil and the diluent. RVP measurements may also be required if the added diluent could potentially increase the RVP to unacceptable levels. The objective is to have sufficient data so that a relationship between density of the viscosity and the ratio of blending can be determined. This relation is then applied to a control strategy for physical application On-line blending using ratio control is often applied where larger ratios of diluent are required, i.e. greater than five percent, and higher in the twenty to thirty percent range. The focus is reducing the streams density or viscosity to improve flow characteristics in the pipeline rather than achieving a specific viscosity or density target. Where a specific target is required then analytical measurements must be made. They can be achieved by using on-line equipment or collection of samples and analysis using laboratory equipment. Viscosity is very dependent upon temperature and in an inversely and non-linear manner. Smaller changes in temperature can create rather large changes in viscosity. As such, using viscosity for the controlling parameter for blending may be difficult. Often the target viscosity may be at a specified reference temperature that can be different than the actual streams temperature. This adds another level of complexity as the line or measured stream viscosity must be determined at the reference temperature. Some pipeline companies have imposed an incremental tariff structure where the tariff will increase in a stepwise fashion according to the products density and viscosity. The rationale is that the more viscous and heavier oil will require more horsepower and reduce line capacity. Each increment will specify a maximum density and viscosity that is allowed. The viscosity will be referenced to a variable posted temperature where as the density will always be referenced to standard conditions. The posted reference temperature is supposed to mimic the lowest line temperature on the pipeline and therefore will change according to seasonal temperatures. On pipelines that transport liquids in designated batches there is always the concern of product degradation due to poor interfaces between successive batches. To minimize this, batches are interfaced with product types that are as similar as possible. Efforts are made to provide as well-defined interface, i.e. flow profile as viewed in a circular cross section of the pipe, between the two successive batches.

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Flow profiles are a function of the flow regimes defined as laminar, transition or turbulent profiles. The reader is encouraged to obtain more information as a detailed description is beyond the scope of this paper. In summary, the three flow profiles are the result of fluid velocity and viscosity for a given diameter of pipe. Lowering the viscosity will tend to provide a turbulent flow profile and a more defined ending of one batch and start of the next. It is for this reason that pipeline companies will require fluid viscosities below a ceiling limit. Product Value Crude types are characterized by their quality which is both their chemical and physical properties, e.g. TBP true boiling point distillation, density, sulfur content, RVP asphaltene content, paraffin content, etc. Each crude type will have specific limitations and boundaries around these key indicators for what is acceptable within a particular designation. Both quality and supply will factor into valuation for any crude type. A producer or marketer will want to maximize the value of their crude type. Lower quality crude oil and therefore lower value, may be blended into a larger stream and higher valued stream. The ratio of the two will be determined so ensure the key quality indicators are within boundary limits. Tank blending is often the approach for this type of blending. Pipeline Capacity Pipeline companies that transport shipments in batches have the responsibility to ensure that the amount of product degradation caused by mixing of dissimilar products or crude oil is minimized. Therefore, scheduling is aimed at ensuring successive batches are relatively similar. Dedicated breakout tankage is required as tank heels can create undesirable cocktails. Sometimes the difference between one crude oil designation and the next may be driven more from a marketing perspective than true composition or quality reference. Scheduling and the need for dedicated tanks can create serious line capacity issues. On the trunk pipelines this can lead to apportionment of shipments which results in shut in or diverted production. The alternative is to reduce the number of crude types by expanding the boundary of key quality indicators. Instead of having ten different crude oil types, each with their own quality descriptors, there May be one with a broader range of acceptable parameters. An example would be the percent of sulfur or maximum density are key parameters, the acceptable limits may increase. The difficulty is obtaining the proper value for each crude type. The owners of the higher value stream will want to be compensated whereas the owners of the lower value stream may be reluctant to pass such compensation on. The key is to determine a methodology where value or compensation exchange is determined by a predetermined process called equalization. Equalization works by focusing on the key quality parameters. Each parameter will have a boundary of what is acceptable. The median value of each parameter will represent typical crude of this designation and therefore will be the benchmark in value. The process will assign value to a crude oil if it promotes the betterment of the key parameter(s) and devalue if it decreases the streams value. The process has been proven to work in the Canadian petroleum industry. In the 1980s a company then known as Interprovincial Pipeline was facing line capacity issues on the light product streams. An equalization process was developed and optimized over time. The industry is now looking at doing the same for the heavy stream, as the vast amount of growth is associated with heavy crude oils. Refining Efficiencies Refineries are designed to process a range of crude oils such that their feedstock will provide specific fractions of refined products. Sometimes this range will vary greatly from refinery to refinery. The various processing units are designed and sized so that all the running near capacity for a given feedstock stream. The plants efficiency is maximized in doing so. If the feedstock stream changes then there ay be voids

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in the cut or composition of the various processed streams. An example would be a light oil refinery that has asphalt-making capabilities and therefore would require a heavy component in its feedstock. If the regular feedstock stream changed so that it didnt have this heavy component then a heavy stream would need to be added into the main feedstock Blending in this manner allows the refiner to match the incoming feedstock with existing equipment.

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