Second Birth of Shymkent Oil Refinery


Second Birth of Shymkent Oil Refinery

Shymkent oil refinery is experiencing a rebirth the year of its 30th anniversary. After completion of the ongoing work on modernization and reconstruction of the refinery, the depth of processing will increase and the production rate will reach 6 million tons of oil per year, and the refinery will produce the motor fuels of the ecological classes K4 and K5, in accordance with the requirements of the technical regulations of the Customs Union.

Construction of a new refinery in southern Kazakhstan began in 1972, with the installation of LK-6U, which is still the core of the refinery. During that year, the non-standard equipment shop was built, followed by an idle period, since the construction works began simultaneously at several refineries: in Ukraine, Russia and Belarus. Works at the site near Shymkent resumed in 1976, with the construction of auxiliary shops. In 1978, two new facilities were put into operation: shop for water supply, sewerage and treatment facilities for the existing thermal power plant (TPP)-3, which provides the thermal energy for the industrial zone of the city, as well as transportation artery of the refinery-its commodity shop.

Finally, by 1983 the first batch of oil was received for refining from Western Siberia via “Omsk-Pavlodar-Shymkent” pipeline. On April 11, the first train was loaded with”black gold”, which went for processing to the Fergana refinery. In mid-1984, a number of facilities, including the steam-water-air supply shop with subdivision of nitrogen-oxygen station, central condensate station, air compressor unit and the central laboratory. These are the facilities, needed for  launching LK-6U. The first Shymkent gasoline was produced here on January 28, 1985!

This day was a real celebration, crowning the work of thousands of people, who designed and  launched the refinery. High-class specialists, who subsequently became the founders of worker dynasties, were invited to ensure the smooth operation of the equipment from different refining regions of the Soviet Union – Guryev, Pavlodar, Fergana, Ufa.

In August 1985 two more sections were commissioned: sections 200 and 300, and in January 1986, they were followed by the gas fractioning unit-section 400. In the spring of 1986, the refinery started its operations in full, with planned production rates, achieving the capacity up to 6 million tons of oil annually.

On February 12, 1996, the South-Kazakhstan Territorial Committee on State property established a joint-stock company ShymkentNefteOrgsyntez (ShNOS) on the basis of the Shymkent oil refinery. After the collapse of economic connections within the Soviet Union, the refinery faced the acute problems with crude oil supply. Instead of the West Siberian oil, which is relatively heavy one, with low paraffin content and medium sulfur content (refinery was designed for such specifications), the oil refinery started receiving the oil from Kumkol field, located in Kyzylorda region. Kumkol crude oil  has low sulphur and high-paraffin content, and in the beginning there were the difficulties, related to production of diesel fuel and kerosene. The diesel hydrotreating unit was reconstructed in 1998, and in year 2001 a new technology was introduced for jet fuel production.

Since 2000 the refinery is owned by Petrokazakhstan company (former Hurricane Hydrocarbons Ltd.), and in 2005 PetroKazakhstan was acquired by CNPCI, a subsidiary of China National Petroleum Corporation. In 2007, Shymkent refinery got  another shareholder, represented by the  National Company KazMunayGas with 50% ownership. Thus, ShNOS was first transformed into Hurricane Oil Products LLP, and later  to  Petrokazakhstan Oil Products LLP (PKOP). Since then, the success of the refinery guaranteed by its two strong shareholders, represented by the relevant national companies from two states: Kazakhstan and China.

After a quarter of century it became apparent that the refinery became outdated. Level of oil processing and output of light oil products did not meet the requirements for the modern refineries and the environmental quality specifications for gasoline were strengthened in the country. Moreover, the same situation existed in another two refineries: in Atyrau and in Pavlodar. In this connection, the Government has developed a program of the oil refining industry upgrade in Kazakhstan. In October 2010, the Government approved the  programme for the Oil& Gas Development in the Republic of Kazakhstan for 2010-2014, which included the reconstruction and upgrading of Shymkent oil refinery.

The upgrade project has also been included in the State program of Industrial &Innovative Development of the Republic of Kazakhstan for 2010-2014 and 2015-2019, approved by Decree of the President of Kazakhstan and it was listed among the strategic investment objects of the Republic of Kazakhstan, approved by decision of the Government of the RoK.

The project of reconstruction and upgrading the Shymkent oil refinery is implemented in 2 phases. During the first phase, the project stipulates construction of new and reconstruction of existing technological facilities and plants to ensure the release of motor fuels of environmental grades K4, K5, in accordance with the requirements of the technical rules of the Customs Union. It is similar to European standards Euro-4 and Euro-5, adopted in the countries of the Customs Union. The first phase projects: construction of the isomerization unit; construction of sulfur production facility with capacity of 4 000 tons per year; reconstruction of diesel hydrotreatment unit – section 300.

The second phase includes construction of new and upgrading the existing technological units and facilities to restore production capacity up to 6 million tons annually and to increase the processing level:

  • catalytic cracking RFCC;
  • hydrotreament of gasoline “Prime G +”;
  • gas demercaptanization “Merox”;
  • production of ETBE additives;
  • production of sulfur, hydrogen purification, etc.

Currently, the feasibility studies, design and estimate documentation are ready. The first phase is under implementation now-  reconstruction of diesel fuel hydrotreatment (section 300) is partially completed; K5 diesel was obtained for use in summer mode; construction of sulfur production reached its final stage, the commissioning works are ensured; development of working documentation, placing orders for equipment and construction-assembly works on isomerization unit. On January 16, 2015, the EPC contract was signed with the general contractor –  Kazakhstan Branch CPECC (Kazakh branch of China Petroleum Engineering and Construction Corporation, subsidiary company of CNPC Corporation (China) for implementation of the second phase; currently, the working documentation is being drafted and the orders for equipment are in process. In accordance with the schedule, the Project completion is planned for 4 quarter of 2016.

After completing the Project of reconstruction and upgrading the Shymkent oil refinery, the production of oil products will increase:

  • high-octane gasolines-from 735 to 2 162 thousand tons per year;
  • diesel fuel- from  1 346  to 2 013 thousand tons per year;
  • jet fuel-from 280 to 400 thousand tons per year.

In addition to increasing the light crudes yield (share of high-octane gasoline in total gasoline pool will amount to 100%), the Project of reconstruction and upgrading the Shymkent oil refinery will also resolve some important social issues in the region, including creation of new jobs in Shymkent and improvement of ecological  safety in the southern region of Kazakhstan. 

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