VIP Shipper Club story – Rewards of Emissions Rally

ISSUE 3 / 2018

THE PUBLICATION FOR THE INDUSTRIAL PROJECT SUPPLY CHAIN INDUSTRY

ISSUE 3 / 2018

REWARDS OF EMISSIONS RALLY Project Cargo Upside from International Sulfur Legislation

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SHELL ...................................................................................................................... page 74

CASE STUDY

Rewards of Emissions Rally Project Cargo Upside From International Sulfur Legislation

BY ANDREW WILLIS

I

nternational Maritime Organization plans to reduce the maximum allowed sulfur content of marine fuel from Jan. 1, 2020 are already having an impact throughout the global oil and transport markets.

While shipping companies prepare for the higher fuel bills that may result from the environmental protection measure, oil refiners are moving to upgrade plants so they can meet

greater demand for cleaner fuels. This shift is offering project cargo movers a steady stream of business in the run-up to the 2020 deadline.

One example is the Pernis refinery in Rotterdam, the largest of its kind in Europe, where Royal Dutch Shell is constructing a new solvent deasphalter. The upgrade will enable the plant to separate heavier fractions from crude oil so that a larger share of the petroleum can be processed into lighter, higher-grade products.

Other refiners have also started or are planning similar solvent deasphalter investments as they bid to keep pace with evolving emission standards across the globe.

“We have a changing fuel oil market,” said Shell’s Rob Snoeren,

project lead for the new development at Pernis. “We, as a refinery, want to be ready for that change and therefore we are developing the solvent deasphalting unit to extract more valuable products like kerosene and gas oil.”

SHIFT TO MODULIZATION

Refineries are typically constructed using a “stick build” method where individual components are added to the main structure, piece by piece.

During the design stage of the Pernis upgrade, however, Shell decided to break with tradition. As a result, about 80 percent of the new refinery unit was built from five modules and five pipe racks that were assembled in China and then shipped to Europe in the second half of last year. This strategy enabled Shell to deliver the project quicker, cutting its overall cost.

“We were able to start the module fabrication almost at the same time that we were putting the first spade in the ground,” Snoeren said. “So we are getting an overlap of construction phases and thereby gaining a lot of time.”

Building the modules in a controlled workshop environment also brought

ABOVE: The Pernis Refinery upgrade project broke with tradition and used modularization in its construction. /

74 BREAKBULK MAGAZINE www.breakbulk.com

CREDIT: SHELL

ISSUE 3 / 2018

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considerable safety advantages to the project, especially when compared with the risks of constructing at an active refinery with large volumes of hydrocarbons close by.

While assembly of the modules took place in China, many of the electrical components, including cables, cable trays and pipes for the project, were shipped from Europe and other regions to the Chinese construction yard. The structural steel for the modules came from China itself.

Shell hired Agility Project Logistics to carry out the logistics management for the multifaceted transport operation. This included sending hundreds of loose items from all over the world to China, shipping the completed solvent deasphalter modules back to Rotterdam, and all the customs formalities that entailed.

PARTNERSHIP SELECTION

This construction strategy did present challenges, however, influencing the unit’s design and Shell’s choice of companies to carry out the complex move of the bulky modules thousands of miles across the globe.

“It starts with selecting the right partner to design the unit modules, and then understanding the limitations of logistics and transportation,” Snoeren said.

Shell’s own internal experts verified the transport plans and stayed 76 BREAKBULK MAGAZINE www.breakbulk.com

limits and the shipment was able to proceed with the original transport plan.

“Because we had to deal with all the changes in weights it was a particularly difficult one,” van Veenendaal said of the project. “We ended up very close to the edge of saying ‘no, this is not possible any more. The modules have become too heavy now.’ ” Had that been the case, the parties involved could have selected different vessels to transport RollDock provided the ships and carried out the the modules. However, sea transportation of the modules from China this would have caused to Europe over three separate voyages. delays and significant CREDIT: ROLLDOCK complications in Rotterdam and at the Pernis refinery site, where parts for the in close contact with all the parties solvent deasphalter needed to arrive in a particular sequence. involved in the move from the COOEC yard in China’s port of Qingdao to the CLOSE CONTACTS KEY Pernis refinery in Rotterdam. The One of Agility’s key roles in the comdimensions of the solvent deasphalter modules – some standing at 30 meters plex project was to stay in contact with all the parties involved and make sure high, 35 meters long and 14 meters everyone’s plans matched. This included wide – meant the job was anything but straightforward. linking the Chinese yard with RollDock for successful loading of the cargo in “It’s not like things that you do every day or every week,” Snoeren said. Qingdao, as well as ensuring that the proper unloading equipment was ready “These are large modules, they are a in Europe when the vessels arrived. particular size and the risk is there.

RollDock, subcontracted by Agility, But we do everything to minimize the provided the ships and carried out the risk to as low as reasonably possible.” sea transportation of the modules from “The challenge we had during the process was that the weight of the China to Europe over three separate voyages in the second half of last year. modules changed considerably,” added The company’s multi-deck vessels Leon van Veenendaal, operations allowed roll-on, roll-off loading for manager with Agility. “They kept the heavier modules, as well as crane adding materials. So we started with loading of the lighter cargo. a weight and ended up with modules which were considerably heavier than expected.”

The additional weight was an issue particularly for the second voyage, where the ship was carrying two large modules. Even before the weight gain the plans were to load the modules on a lower deck because of their weight and size.

As the weight increased, stability considerations became more of an issue. However, final calculations showed the modules were still within the ship’s safe stowage and carriage ISSUE 3 / 2018

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The larger modules were loaded onto the ships using self-propelled modular transporters, with the heaviest module weighing about 1,800 tons.

CREDIT: SHELL

Once construction was completed, the smaller cargo pieces were loaded using RollDock cranes. The Chinese yard drove the larger modules onto the ships using self-propelled modular transporters, or SPMTs, with the heaviest module weighing about 1,800 tons.

To counteract the large and awkward size of the modules and the physical forces these created, a grillage was designed to help spread the load across the deck of the ship, increasing the overall stability.

“It presented quite some challenges for the ships,” said Paul Hoogenhout, RollDock’s project manager for the operation. “Because the blocks were heavy, narrow and high, they were unstable and prone to tipping over.”

Given the height of the modules, the grillage had to be low, yet still spread the load efficiently. The grillage 78 BREAKBULK MAGAZINE www.breakbulk.com

also helped to protect the deck of the ship from damage in case the ship met strong winds or large waves during the voyage.

SPECIALIST DESIGN PARAMETERS

With the grillage designed, loading of the tall and narrow modules onto the ships itself was complicated by the large tidal fluctuations in the Qingdao area, which made it harder to keep the ship’s deck level with the quay.

RollDock achieved the loading during narrow windows of opportunity by adjusting the ballast of the ships while members of the Chinese yard drove the pieces onboard using the SPMTs. “We were in very close contact with our clients and the construction yard,” Hoogenhout said. “We determined the days and the tide windows when it was possible to load the cargo in a

safe manner, and then the construction schedule and the delivery schedule for the cargo were fine-tuned together with the delivery of the ship to the yard.”

Once loaded on the grillage, the modules were then securely attached using sea-fastenings that consisted of clips at the base of the columns.

Weather was another key consideration for the three journeys.

The first two ships sailed earlier in the year and their passages were uneventful, while the third ship departed at the beginning of October, just weeks before Typhoon Lan hit Japan.

“It was crossing the area, so we had to complete operations very fast so that the ship could go quickly out of port to be able to avoid the hurricane and go in front of it,” Hoogenhout said.

The ship did successfully avoid ISSUE 3 / 2018

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CASE STUDY

the strong winds and arrived in the Netherlands carrying the final two modules for the solvent deasphalter.

THE LAST MILE

CREDIT: SHELL

BREAKBULK BOON FROM REFINERY SULFUR SWITCH The continued drive towards reducing carbon emissions suggests that transport companies can expect more breakbulk operations supporting the necessary evolution of refineries in the years to come.

Solvent deasphalter units are an increasingly popular option for refiners who are looking to increase their products range, given International Maritime Organization, or IMO, legislation that will cut sulfur limits in marine fuel from 3.5 percent to 0.5 percent from Jan. 1, 2020.

“This will significantly reduce the amount of sulfur oxide emanating from ships and should have major health and environmental benefits for the world, particularly for populations living close to ports and coasts,” the IMO said on its website.

The lead time for a solvent deasphalter is about three years, significantly quicker than building other types of refinery unit that deal with heavier fractions from crude oil. As well as Shell’s project at Pernis, Total has built a solvent deasphalter at its Antwerp refinery,

increasing the plant’s ability to produce higher-value products, while Neste Corp. started up a solvent deasphalter at its Porvoo plant in Finland last year.

The investments show just how much the IMO rule changes are shaking up the downstream oil industry. Although high-sulfur bunker fuel accounts for very small amounts of global oil demand, the marine market has traditionally helped refiners to use up residue from the refining process by turning it into heavier fuel oil.

As well as this, analysts are forecasting further turmoil as the increased demand from the shipping industry for lower sulfur fuels from 2020 onwards exacerbates the limited production capacity, potentially increasing prices of oil products including petrol, diesel and jet fuel.

For breakbulk transporters however, the rule change has produced a number of largescale projects for those willing to take on the complex operations.

And as 2020 approaches, it seems a reasonable assumption to expect several more.

80 BREAKBULK MAGAZINE www.breakbulk.com

Mammoet was hired to carry out the final leg of the journey, transporting the refinery equipment from the docked vessels at the Mammoet quay in Schiedam to the Shell Pernis site, less than a halfhour’s sail away.

The first RollDock vessel had five smaller bits of cargo ranging from 30 to 100 tons, as well one module weighing roughly 600 tons. Once the sea-fastenings were removed, the smaller pieces were lifted off the vessel using a floating crane and then sailed to Shell Pernis with the crane.

For the larger and heavier module, the hull at the back of the semi-submersible RollDock vessel was opened. Mammoet then drove a barge next to the ship where it was connected to the vessel’s ro-ro ramp. After ballasting, the SPMTs were driven from the barge on to the RollDock ship, the modules were then secured on top of the SPMTs and driven off one by one. Once loaded, the barge was pulled by tugboats to Pernis.

A ro-ro ramp was constructed at the Shell Pernis site so that the SPMTs could drive off the barge directly onto the refinery site and then to their final position. Here they had to be jacked down using timber because of the height of the grillage.

The whole process was repeated for the second and third ships that each carried two larger and heavier modules.

The successful operation illustrated the importance of detailed planning right from the start with the modules constructed in such a way that they could be transported from the construction yard in China to a particular quay in Europe, and still be able to successfully carry out their ultimate refinery role. BB Andrew Willis has worked as a journalist for more than a decade in countries including Argentina, Belgium and Colombia.

ISSUE 3 / 2018

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