GC refineries need more hydrogen

Gulf Coast petroleum refineries have increasingly relied on merchant suppliers, rather than their own production, to provide hydrogen used to reduce sulfur content in fuel. As global demand for distillate fuel oil increases and sulfur content regulations more stringent, refineries have need for more hydrogen. Hydrogen demand is expected to continue to rise as International Maritime Organization regulations limiting sulfur content in marine fuels takes effect on Jan. 1, 2020. GV refiners in Petroleum Administration for Defense District 3 – Alabama, Florida, Louisiana, and Mississippi - are consuming more hydrogen from merchant suppliers than their own production. From 2012-17, consumption of hydrogen obtained from merchant suppliers increased 25 percent. Over the same period, on-site production of hydrogen from natural gas fell 13 percent. In 2017, merchant suppliers accounted for more than 85 percent of hydrogen consumed the GC refineries. A big part of hydrogen’s use by GC refineries is supplied by a 600-mile, 1B cubic foot per day network of hydrogen pipelines that links Lake Charles, La., to Houston. From 2012-17, GC petroleum refineries increased its hydro-cracking capacity by 50 percent with a similar increases in distillate production. Over the same period, steam methane reformer (SMR) unit capacity went down 19 percent, leading refiners to purchase more hydrogen from merchant suppliers. (Source: General Energy News 03/16/19)