Chemical & Petroleum Engineering

School of Engineering and Physical Sciences

PROCESS INDUSTRIES A
SITE VISIT REPORT
COVER SHEET
Name: Mammad Aliyev H00177649
Date of Visit: 15 February 2014
Special Topic: Economics
Report Marker: Dr. Goodwin
Date of Submission: 31 March 2014

Contents
Introduction................................................................................3
Site Background.........................................................................3
Technical Content......................................................................4
Distillation Columns............................................................4
Separators..........................................................................4
Compressors......................................................................4
Control Rooms....................................................................5
Economics..................................................................................5
Conclusion.................................................................................7
Personal Impressions................................................................8
References.................................................................................9

Introduction
The purpose of this report is to demonstrate some information about background of the
Azerneftyagh Oil Refinery, the specific types of operation such as distillation, separation,
compression and control systems. There will be also included some information about
economics and and similarities between Azerneftyagh Oil Refinery and Heydar Aliyev
Baku Oil Refinery that was visited in the last semester .

Site Background
Azerneftyagh Oil Refinery was established in 1879 as a result of combining of several oil
refineries operating in the past in the region called Black City in Baku. The oil refinery
complex was the leading organization in the oil industry during 135 years of its existence.
During 1941-1945 world war period the refinery was rewarded with Lenin Order and by
Challenge Red Banner from State Defence Committee many times for supplying battlefront with the combustive-lubricating materials. In 1981 the unit of preliminary oil refining
ELOUAVT- 6 which annually refines 6 million tons of oil was put into commission. In 19941995, two new ELOU-AVT-2 processing units were established with the cooperation with
the American "Petrofac" Company and Korean "Lucky Engineering" Company. In 2000,
Bitumen production unit Biturox producing power of which is 250.000 tons, was launched
to assist implementation of large-scale road constructions and renovation works in the
republic1.
The refinery produces gasoline, kerosene, and diesel distillates and motor, industrial,
transformer, and other oils and asphalt. For the last 2 years, all fuel distillates produced
there have been sent to the Heydar Aliyev Oil Refinery in Baku for redistillation. In 2010,
the refinery produced 215,200 tons of straight run gasoline, 174,900 tons of kerosene,
599,800 tons of diesel distillates, 1,300 tons of motor oil, 27,600 tons of industrial oil, 7,900
tons of turbine oil, 14,100 tons of transformer oil, 36,200 tons of other oils, and 241,400
tons of asphalt2.
1 http://www.azerbaijan.az/_Economy/_Industry/industry_06_e.html
2 http://new.socar.az/socar/en/info/printable/activities/refining/azerneftyagh-oil-refinery

Technical Content
Distillation Columns
There are two types of distillation columns in Azerneftyagh Oil Refinery;
ELOU-AVT-2 and ELOU-AVT-6. These distillation columns have also desalting
function. The production rates of these two units are respectively 2 million tons and 6
million tons per year. The distillation columns are in cylindrical form, with 80 m height
and 6 m diameter. Crude oil which is demodulated in oil platform is raw material for
the distillation column. Demodulation can be defined as desalting process. Oil
comes from the tanks and passes to heat exchanger in 360 oC temperature and 12
atm pressure. After that, desalted crude oil passes to initial production unit and to
Baku Oil Refinery by pipes.

Separators
Separators in the oil industry are extensively used for separating oil and gas mixtures into
their constituent elements. Currently, there is no any operating separators in Azerneftyagh
Oil Refinery .

Compressors
The compressors of the Azerneftyagh Oil Refinery are similar to the compressors of the
Heydar Aliyev Baku Oil Refinery. We were informed about the Hydrogen Compressor
Station with the capacity of 80 m3. It is 11 meter height and 3 meter diameter. Compressors
work with electrical energy, and the voltage o this energy is controlled by the redactor.
These compressors work in maximum 170C and above this temperature compressors are
automatically switched off. Compressors are placed on the ground for safety purposes.

Control Rooms
4

The room that control systems place is controlled by engineers attentively and
equipped with new and high technological items. The control system consists of two
programs: Experion PKS software and CCS software. . Monitors and control
panels demonstrate the information related to ongoing processes in charts and
tables.The signals from control rooms are send to control valves via special
detectors built on equipment. The control room is situated in 40 meters away main
plant.

Economics
As economy plays a great role in all professions, petroleum sector is also affected by
economic issues. Generally, economics itself is a very complicated subject, and if it is
considered in the aspect of oil industry, lots of new concerns will be appeared such as
refining, governmental policy, geopolitical issues, and transportation and so on. That is why
there are very diverse approaches to petroleum economics. So many experts struggle to
keep balance between demand and supply, check the costs in time and determine the
benefits and losses of the process professionally.
There are two essential factors that need to be considered crucially in refinery: capital
costs and operational costs.

Capital costs - Capital costs are fixed and are therefore independent of the level of output.
Capital costs are fixed, one-time expenses incurred on the purchase of land, buildings,
construction, and equipment used in the production of goods. Simply, it is the total cost
needed to bring a project to a commercially operable status.
Capital costs include the following:

Land - Purchase of the land upon which the plant is built

Building

Construction Costs involving the construction of the plant

Equipment needed to run the plant

However, the cost of the natural gas, fuel oil or coal used once the plant enters
commercial operation or any taxes on the electricity that is produced, is not included.
They also do not include the labour used to run the plant or the labour and supplies
needed for maintenance.

Operational costs - Operational costs are the routine costs of running a business
and they are on a day to day basis. Operating costs include both fixed costs and
variable costs.
Fixed operational costs include:

Rent or mortgage payments

Salaries for non-production personnel

Insurance

Building maintenance.

Variable Costs include:

Wages

Raw materials

Electrical use

Utilities

Waste disposal

Shipping (transportation) costs

Several characteristics should be noted, when considering the economic

performance of a petroleum refinery. Firstly, capital investment for technological
improvements can have significant structural effects on the economics of a refinery.
Secondly, the major variable cost in the production process is the price of crude oil,
which is determined in the world petroleum market. Finally, regulatory cost - capital
and operational, increase as new requirements are phased in for meeting
congressionally mandated environmental standards on both refined products and
refinery sites.

Conclusion
In conclusion, it will be advisable to compare The Azerneftyagh Oil Refinery with
the Baku Oil Refinery (BOR). Both plants are main refineries of Azerbaijan. These
two refineries are operating by SOCAR. Azerneftyagh Oil Refinery is older than the
BOR, and it was established with a capacity of 230000 barrels per day, while BOR
with a capacity of 212000 barrels per day. In 2008, the production of oil was 4.8
million tons and 2.5 million tons in the BOR and Azerneftyagh OR respectively.3

3 https://www.iaee.org/en/publications/newsletterdl.aspx?id=118
7

Both refineries produce initial refining gasoline, diesel fuel, TS-1 reactive fuel,
furnace oil, vacuum gasoil. However, the BOR produces coke, much more black oil,
gasoline than Azerneftyagh OR, and Azerneftyagh produces much more bitumen,
lubricating oil than BOR.
The installation ELOU-AVT-6 is utilised in both refineries which is the unit of
preliminary oil refining and annually refines 6 million tons of oil with high quality.

Personal Impressions
Our university have organized site visit to the Azerneftyagh Oil Refinery in order to
give us opportunity for observing the main stages of refining process. The personnel
of the refinery were also very warm and kind to us. They tried to inform us
comprehensively about everything that we are interested in.

References
http://www.azerbaijan.az/_Economy/_Industry/industry_06_e.html
http://new.socar.az/socar/en/company/organization/azerneftyagh-oil-refinery

http://www.azerbaijan.az/_Economy/_Industry/industry_03_e.html
http://new.socar.az/socar/en/info/printable/activities/refining/azerneftyagh-oilrefinery