Tuesday, January 27, 2015

Critical Comments on the Phillips 66 Rodeo and Santa Maria Refineries Expansion of Combined Production Capacity

Charles Davidson of Hercules (2015-01-27) at [https://archive.today/nEP9d]:
Please read my submitted brief critique of the Phillips 66 EIRs for the “piece-mealed” Rodeo and Santa Maria combined Tar Sands project. The comment is based on my reading of the recirculated draft EIRs for both the Phillips 66 Rodeo Refinery’s Propane Recovery Project and the Santa Maria Refinery’s interrelated Rail Spur Expansion Project and Throughput expansion Projects.
My short comment letter, with slight variation, was sent to both (the Contra Costa and San Lois Obispo) County Planning Commissions and was also based on the great detailed analysis of both Greg Karras (of Communities for a Better Environment) and Dr. Phyllis Fox (of Shute, Mahely and Weinberg). I tried to make my 2-page letter (below) as short and non-technical as possible.

The analysis was made easier in the recirculated EIR compared to the draft EIR, because they finally stated outright that the crude by rail would absolutely not be the highly volatile Bakken North Dakota light shale oil, leaving Canadian Tar Sands bitumen (extra heavy crude) as the only possibility.
Tar Sands and Bakken crude are both land-locked and can only get to CA by rail or barge from up north, but the key P66 project in Santa Maria is a Tar Sands rail expansion project.
The reason that Canadian Tar Sands ends up in Rodeo, is that CA crude from down south would not arrive in 100 car trains and the crude that is pre-processed in Santa Maria goes directly, via their 200-mile pipeline, into P66’s Rodeo coker unit, that only processes heavy crude.

Note: The Tar Sands bitumen is so dense and heavy that it must be diluted with 30% light weight petroleum solvents to liquify it and it is then called DilBit.
Per Greg Karras: DilBit takes 2-3 times the energy to refine as typical or traditional crude, it has unusually high amounts of heavy metals (like nickel and vanadium), it produces more Petroleum Coke (PetCoke) and coking it violently (at 900 degrees Fehrenheit) for a day or so produces lots more propane than would the refining go traditional crude oil, hence part of the reason for the propane recovery project to recover the extra propane. P66 has a nearly one billion dollar contract deal with the Chinese company SinoPec for propane delivery ($850 million).

P66 in Rodeo, at least according to a recent EPA document, is the most polluting refinery in California. The brief, unreferenced document did not break down particular pollutants or whether the pollutants are airborne or water born.
Not stated in my EIR comment letter: It should be noted that P66 in Rodeo has a “Nelson Complexity Index” of 13.6, one of the highest in the world and the highest in the U.S., indicating that the refinery is unusually complex and capable of refining the heaviest crude in order to produce the highest valued products, such as gasoline.

Phillips 66 Rodeo and Santa Maria Refineries Expansion of Combined Production Capacity, Tar Sands Refining Capability and Propane Production

The first major problem with Phillips 66’s Santa Maria Railroad Spur Extension Project Recirculated Draft Environmental Impact Report (RDEIR; 1), is that it is a piecemealed project since the Santa Maria Refinery is connected by a 200-mile pipeline to the San Francisco Refinery in Rodeo. In turn, the Rodeo Refinery accepts heavy gas oil derived from semi-refined Santa Maria heavy crude feedstock and then completes the refining processes in order to make higher-valued products, such as gasoline, diesel and jet fuel. Concurrently, a Rodeo Refinery RDEIR is proposing the Propane Recovery Project (1). Multi-project EIR piecemealing is illegal in California under CEQA.

A second major problem with Phillips 66’s Santa Maria Refinery Railroad Spur Extension Project RDEIR is that it fails to disclose the fact that the refineries’ most likely source of crude oil would be a type of high-sulfur, extra heavy crude oil derived from Canadian Tar Sands, called bitumen. Specifically, Phillips’ RDEIR states that light, low-sulfur “sweet” Bakken North Dakota crude oil would be an “excluded” type of refinery feedstock carried by rail into Santa Maria, leaving Tar Sands bitumen as the only other “crude-by-rail” available in large enough amounts. (2) The combined Santa Maria-Rodeo Refinery Projects’ dependence on energy-intensive bitumen refining would make them, cumulatively, high greenhouse gas-producing projects that are capable of emitting increased amounts of toxic pollutants and a large excess of highly flammable propane. – Charles Davidson. Dec. 2014


Greg Karras from Communities for a Better Environment (CBE) and Refinery Engineer Phillis Fox, from Shute, Mahaley and Weinberger, have critiqued these disparate Phillips 66 EIRs, authored by Environmental Science Associates, for both their Santa Maria Refinery and Rodeo Refinery. Karras and Fox have established that the separate projects are inherently interrelated and interdependent and they each have done a cumulative analysis for these collective Phillips 66’s projects.

Large amounts of partially refined diluted Tar Sands bitumen, i.e. DilBit, will be sent by a 200-mile pipeline to the Rodeo refinery, that is undergoing the Propane Recovery Project. The Santa Maria Refinery is planning two projects, the Rail Spur Extension (CBR) Project and the Throughput Increase Project.

The Rodeo Refinery will finish off the refining of the heavy gas oils sent from Santa Maria in order to create high valued products such as gasoline, diesel and jet fuel. Aggressive refining of bitumen produces large amounts of propane. DilBit dilutent has a large amount of lightweight hydrocarbons, like propane, as well as butane and pentane, which together are over 7% by weight of DilBit and a much larger percentage by volume.

1) Executive Summary; Phillips SMR Rail Project Recirculated Draft Environmental Impact Report RDEIR. October 2014 ES-5.
2) Phillips 66 Propane Recovery Project RDEIR – SCH# 2012072046 and Phillips 66 Santa Maria Refinery Company Rail Spur Extension Project (RDEIR) – SCH# 2013071028

The Santa Maria and Rodeo EIRs were illegally piecemealed and in their EIRs Phillips tried to obfuscate the real source of the crude, that will be DilBit, like the EIR’s authors imagining a crude influx for some other domestic sources that have dwindle markedly in recent years and decades, like California inland and offshore crudes. Alaska crude has also dwindled in recent decades since its peak, when it was a primary source in-state refinery crude feedstock. These types of domestic crudes are not a practical option in the Santa Maria crude-by-rail expansion project,

The Santa Maria rail spur extension project declares that their will absolutely be no Bakken crude delivered, i.e. that Bakken was explicitly “excluded”, so the only other practical option for delivery by rail is also the most likely rail delivery, being DilBit from Alberta, Canada. To accommodate the fact that DilBit weights much more per barrel and per railroad per tank car than traditional crudes, the RDEIR states that there will be 13 percent less crude within each tanker due to weight limits. The RDER also states that there will be heaters available, that would only be the case should the heavy bitumen in the DilBit separate from the diluent during transportation.

CBE noted that the proposed 10 percent increased processing capacity of the Santa Maria Refinery would indicate real total capacity of about 1 train per day or 344 trains/year, while Phillips’ “RDEIR provides no data supporting its “expected” maximum of 250 trains/year”.

The 200-mile pipeline goes directly into the Rodeo Refinery’s coker, which processes the heaviest portions of crude and heavy gas oils. The coker produces a solid, heavy-metal-laden toxic byproduct, called petroleum coke or PetCoke, that is exported to China and India to burn in place of coal in order to make electricity. High-temperature coking and high-pressure hydro-cracking of the heaviest oils in Rodeo will make a lot of propane and butane, that are sold as Liquified Petrolem Gas or LPG.

The excessive yield of propane recovered will be both from that portion of propane produced by refining extra-heavy DilBit and also by the accumulation of propane-laden DilBit diluent. The Rodeo Refinery currently uses propane and butane to operate their refinery.  Phillip’s plan is to convert the refinery to operating with a large increase in piped-in natural gas, purchased from PG&E.

Phillips has signed a multi-year $850 million dollar contract with the Chinese company, SinoPec, for exporting LPG to China, that would lock Phillips 66 into refining the heaviest crudes. The excess propane generated under this DilBit refining scenario might indicate that the propane must be removed, lest the refinery blow up due to unbalanced thermodynamics. – Charles Davidson. Dec. 2014

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