Shale Gas to Ethylene (G1) - Revision history

Tahirkapoor: /* Physical Flows */

2015-03-13T23:46:37Z

Physical Flows

Tahirkapoor: /* Process Overview */

2015-03-13T23:40:11Z

Process Overview

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	Based on our analysis of technology alternatives and research into existing processes, the process was modeled after the following block flow diagram.		Based on our analysis of technology alternatives and research into existing processes, the process was modeled after the following block flow diagram.
	[[File:capture.jpg\|700px]]		[[File:capture.jpg\|700px\|center]]

	=Process Simulation=		=Process Simulation=

Tahirkapoor: /* Estimating Revenues */

2015-03-13T23:33:59Z

Estimating Revenues

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	==Estimating Revenues==		==Estimating Revenues==
	Due to the extreme volatility in commodities pricing, revenues were not projected to be constant over the lifetime of the plant. Revenues were estimated using current commodities prices and futures from the Chicago Mercantile Exchange (CME). Future revenue estimations are shown in Appendix ~~VII~~. An example of revenue calculations using current prices is shown below.		Due to the extreme volatility in commodities pricing, revenues were not projected to be constant over the lifetime of the plant. Revenues were estimated using current commodities prices and futures from the Chicago Mercantile Exchange (CME). Future revenue estimations are shown in Appendix VIII. An example of revenue calculations using current prices is shown below.

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Tahirkapoor: /* Appendix V: Heat Exchanger Network */

2015-03-13T23:33:20Z

Appendix V: Heat Exchanger Network

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	=Appendix V: Heat Exchanger Network=		=Appendix V: Heat Exchanger Network=

	[[File:~~Full_Composite_curveG1~~.~~jpg~~\|center\|thumb\|upright=4\|Full Composite Curve]]		[[File:Full_Composite_CurveG1.JPG\|center\|thumb\|upright=4\|Full Composite Curve]]
	[[File:Composite_Curve_for_Process_HEXG1.~~jpg~~\|center\|thumb\|upright=4\|Composite Curve for Heat Exchangers]]		[[File:Composite_Curve_for_Process_HEXG1.JPG\|center\|thumb\|upright=4\|Composite Curve for Heat Exchangers]]
	[[File:HENG1.~~jpg~~\|center\|thumb\|upright=4\|Heat Exchanger Network]]		[[File:HENG1.JPG\|center\|thumb\|upright=4\|Heat Exchanger Network]]

	=Appendix VI: Capital Costs and Equipment Sizing=		=Appendix VI: Capital Costs and Equipment Sizing=

Tahirkapoor at 23:31, 13 March 2015

2015-03-13T23:31:42Z

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	=Appendix V: ~~Capital~~ ~~Costs~~ ~~and Equipment Sizing~~=		=Appendix V: Heat Exchanger Network=

			[[File:Full_Composite_curveG1.jpg\|center\|thumb\|upright=4\|Full Composite Curve]]
			[[File:Composite_Curve_for_Process_HEXG1.jpg\|center\|thumb\|upright=4\|Composite Curve for Heat Exchangers]]
			[[File:HENG1.jpg\|center\|thumb\|upright=4\|Heat Exchanger Network]]

			=Appendix VI: Capital Costs and Equipment Sizing=
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	=Appendix VI:Utilities=		=Appendix VII:Utilities=
	==Heat Exchanger Utilities==		==Heat Exchanger Utilities==

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	=Appendix ~~VII~~:Future Revenue Projections=		=Appendix VIII:Future Revenue Projections=
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	=Appendix ~~VIII~~: Discounted Cash Flow Statement=		=Appendix IX: Discounted Cash Flow Statement=

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	=Appendix IX: Sensitivity Analysis Results=		=Appendix X: Sensitivity Analysis Results=

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Tahirkapoor: /* Appendix I:Kinetic Data for Cracking Reactions */

2015-03-13T21:31:42Z

Appendix I:Kinetic Data for Cracking Reactions

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	=Appendix I:Kinetic Data for Cracking Reactions=		=Appendix I:Kinetic Data for Cracking Reactions=

			Literature values of kinetic rate parameters can be used to simulate reaction yields of ethane cracking for different conditions. A few reactions are shown below and their corresponding Arrhenius rate parameters and activation energies are also shown. Using this data, conversion of ethane at the desired operating condition was determined for modeling in HYSYS.

			[[File:A11G1.png\|center\|thumb\|upright=4\|Selected Reactions]]

			[[File:A12G1.png\|center\|thumb\|upright=4\|Rate Parameters for Selected Reaction]]

			[[File:A13G1.png\|center\|thumb\|upright=4\|Simulation of Conversions at Different Conditions using Kinetic Data]]

	=Appendix II:PFD=		=Appendix II:PFD=

Alex Valdes: /* Profitability Analysis */

2015-03-13T21:29:11Z

Profitability Analysis

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	==Profitability Analysis==		==Profitability Analysis==

	Once all cost estimations were completed, a discounted cash flow analysis was performed to examine the economic viability of the process. The discount rate and corporate tax rate used for our analysis was determined by averaging the weighted average cost of capital (WACC) and corporate tax rates for a few large integrated oil and oil refining corporations. All data was retrieved via filings from the Securities and Exchange Commission. (Total S.A. was not included in the tax average due to an unusually high tax rate in 2014)		Once all cost estimations were completed, a discounted cash flow analysis was performed to examine the economic viability of the process. The discount rate and corporate tax rate used for our analysis was determined by averaging the weighted average cost of capital (WACC) and corporate tax rates for a few large integrated oil and oil refining corporations. All data was retrieved via filings from the Securities and Exchange Commission (SEC, 2015). (Total S.A. was not included in the tax average due to an unusually high tax rate in 2014)

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	[[File:Sensitivityanalysisnaturalgasprice.PNG\|thumb\|center\|upright=3\|NPV Sensitivity to Natural gas price fluctuations]]		[[File:Sensitivityanalysisnaturalgasprice.PNG\|thumb\|center\|upright=3\|NPV Sensitivity to Natural gas price fluctuations]]

	If natural gas prices prices fall over 11%, the 12 year NPV will become negative. It is important to consider using financial instruments to hedge against commodity price declines and to ensure a positive net present value in a volatile future.		If natural gas prices prices fall over 11%, the 12 year NPV will become negative. It is important to consider using financial instruments to hedge against commodity price declines and to ensure a positive net present value in a volatile future.


	=Conclusion and Future Steps=		=Conclusion and Future Steps=

Alex Valdes: /* Variable Operating Costs */

2015-03-13T21:28:13Z

Variable Operating Costs

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	The final component of variable operating cost was the cost of raw materials and waste processing. Waste water treatment was assumed to cost $1.5 per metric ton (Towler). Our process inputs consist primarily of raw shale gas but also include water, MEA, and crude oil. The price of water was estimated from industrial water pricing in Ohio and the price of MEA was estimated using industrial suppliers from Alibaba. Raw shale gas costs can vary drastically depending on location, but were estimated using data from Morningstar’s energy observer. Wet gas costs in the Marcellus shale are among the cheapest in america and range from 1-3 dollars per thousand cubic feet of gas. Using the average value of $2 per thousand cubic feet, the cost per kilogram of raw shale gas was calculated.		The final component of variable operating cost was the cost of raw materials and waste processing. Waste water treatment was assumed to cost $1.5 per metric ton (Towler $ Sinnott, 2012). Our process inputs consist primarily of raw shale gas but also include water, MEA, and crude oil. The price of water was estimated from industrial water pricing in Ohio and the price of MEA was estimated using industrial suppliers from Alibaba. Raw shale gas costs can vary drastically depending on location, but were estimated using data from Morningstar’s energy observer (Morningstar, 2014). Wet gas costs in the Marcellus shale are among the cheapest in america and range from 1-3 dollars per thousand cubic feet of gas. Using the average value of $2 per thousand cubic feet, the cost per kilogram of raw shale gas was calculated.

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Alex Valdes: /* Variable Operating Costs */

2015-03-13T21:25:24Z

Variable Operating Costs

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	===Variable Operating Costs===		===Variable Operating Costs===

	The primary components of variable operating costs consisted of heating and cooling utilities, electricity costs from condensers and pumps, waste disposal costs, and raw material costs. After a heat exchanger network was developed and process heat recovery was optimized, total heating and cooling utility loads were extracted from ASPEN Energy Analyzer. Cost parameters for each type of utility were also estimated using data retrieved from ASPEN Energy Analyzer. Electricity costs were estimated using energy stream data from HYSYS and assuming a cost of electricity of $0.0662 per kW*hr - the average cost of industrial electricity in Ohio.		The primary components of variable operating costs consisted of heating and cooling utilities, electricity costs from condensers and pumps, waste disposal costs, and raw material costs. After a heat exchanger network was developed and process heat recovery was optimized, total heating and cooling utility loads were extracted from ASPEN Energy Analyzer. Cost parameters for each type of utility were also estimated using data retrieved from ASPEN Energy Analyzer. Electricity costs were estimated using energy stream data from HYSYS and assuming a cost of electricity of $0.0662 per kW*hr - the average cost of industrial electricity in Ohio (EIA, 2015).

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Alex Valdes: /* Process Overview */

2015-03-13T21:21:17Z

Process Overview

← Older revision		Revision as of 16:21, 13 March 2015
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	Based on our analysis of technology alternatives and research into existing processes, the process was modeled after the following block flow diagram.		Based on our analysis of technology alternatives and research into existing processes, the process was modeled after the following block flow diagram.
	[[File:~~fig1~~.jpg\|700px]]		[[File:capture.jpg\|700px]]

	=Process Simulation=		=Process Simulation=