Catalyst engineering technical services refers to a set of services related to the analysis, optimization and monitoring and control of catalysts. Process catalysts sometimes impose huge costs on consumer companies due to the presence of valuable metals in their structure as well as complex technologies in production, so to ensure that they have been able to create enough added value during their useful life. In the process, they need separate analyzes and real time monitoring, and these services must be provided by a group that, in addition to mastering refining processes, also has sufficient mastery over how catalysts work in different operating conditions.
In May of this year, on the sidelines of the 27th oil exhibition, we had an opportunity to have a conversation with Amirhossein Alavifar, the CEO of Artin Azmahar. In this short conversation, Alavi Far said: Since 2018, after obtaining a license, we have built a production unit in Bushehr economic zone with the participation of Russia and localized one of the catalysts for mercaptan removal. We also equip the laboratories of oil and petrochemical centers. This issue became the basis for us to have a detailed conversation with this expert in the field of oil and gas. He has a master’s degree in industrial engineering, systems analysis and operational and financial risk assessment, as well as a doctorate in oil and gas economics with a specialization in oil and gas infrastructure and risk assessment from Russia. He has offices in Dubai, Tehran and Bushehr Technology Park. Last month, he had the opportunity to have a longer interview, which follows:
The war between Russia and Ukraine created a situation in terms of balancing the price of oil products and affected the product market in Iran. Considering your familiarity with the Russian economy, what investments or mediation in the oil field or swaps could you create?
Maybe we could, but the oil space and the trade of oil products were unknown to our company and our Russian partners, and we did not have much relative and competitive advantage in it, and in general, this trade in Russia is dominated by oligarchs and large oil companies. Instead, we did another thing, and that was the policy of entering the oil product production value chain and creating commercial-production activity in this area, in other words, instead of trading oil products, investing in its added value chain. Such as fuel supplements, octane boosters, antioxidants, gasoline color, CFPP improvers for diesel or capital goods such as laboratory equipment have been in this chain. The oil and gas field in Russia has the advantage over our country that most of the consumer, intermediate and capital goods have been developed in this country, which is the result of long-term investment of oil revenues in the development of indigenous oil technologies, and It can be said that technologically in this field, they beat western technologies, so we defined our playground from the beginning in the technology transfer of this chain so that our business complements the business of large and small refineries in the country.In fact, our competitive advantage is that the hydrocarbon product that is produced, we can help in the discussion of its process to increase the added value of that product. For example, now we can sell our mercaptanization catalysts to hydrocarbon units for nearly 50 dollars per ton, and it also reduces production costs. We provide them with the catalyst, and the knowledge of how to apply it to their processes. In addition, other services such as decolorization of petroleum products, increasing the octane number, other fuel additives such as antioxidants, antifoam, gasoline color, etc., all of which require the use of engineering processes that ultimately increase the quality of fuel and the added value of goods. In providing to the market, it is included in the services of our company.
Fortunately, this development has been realized in line with trust in the country’s young and elite force, and the process engineering department, which is responsible for providing technical engineering services for process catalysts, has been established for the first time in Iran. Catalyst engineering technical services are a set of services related to analysis, optimization, monitoring, control and improvement of the use of catalysts, and finally recovery and replacement of catalysts in refining and petrochemical processes. In the world, well-known catalyst companies such as Axens of France or UOP of the United States have been providing these services regarding their catalytic products for many years.
Perhaps one of the reasons for companies’ neglect of technical engineering services was the raw sales approach?
Yes, that’s right, technical engineering services means optimizing and analyzing how many units of profit are sent to your company for each unit of cost you spend. When you sell a lot of raw materials, you focus less on improving the quality of the products, and these issues become serious when the consumer market becomes more competitive and considerations such as environmental considerations are also involved in consumer decisions.
In other words, technical analysis and engineering services become relevant when the economy becomes relevant, and when the economy becomes relevant when resource limitations become relevant. To have a correct understanding that our resources are very limited and to produce and distribute products with high added value with these limited resources, this process will not be completed unless the real meaning of privatization happens.
With this situation, how has mini-refinery and petrochemical units received your services?
It is more or less good because they faced this limitation. There was a time when those who sold diesel or gasoline paid no attention to its quality conditions and the products could only be supplied with a physical cut, but in today’s competitive markets, quality is the main issue.
It is better to say that this necessity should be understood and emphasized from two sides, first from the side of small and medium private units, the principle of competition in the market and providing quality products is always a main incentive to ensure the long-term presence of these units in the regional markets. Second, from the government’s side, it should be understood that, like many countries in the world, paying attention to mini-refinery units can increase domestic energy security, as well as increase economic prosperity and create employment. For example, Russia, which is an oil-rich country, in addition to its large and well-known refineries, also has about 50 mini-refineries in its Far East regions, and in these regions, where Gazprom Neft can distribute oil products. (Due to the distance and high transportation costs), the products of these mini-refineries are used. In America, there are a total of 140 mini-refinery units and they play a very important role in supplying fuel and petroleum products to local markets and areas where access to large refineries is expensive.
In this regard, the government of Iran should help the development of this industry in Iran by using support policies such as providing development facilities, tax discounts, commitment to purchase products for the local market, removing some internal laws and restrictions. These industrial units, by investing a part of their profit in making the production processes more complicated, must commit to producing higher quality products that can compete with the products of the refineries.
A big challenge in companies is that they are interested in creating and managing all matters within the organization, and consulting services are no exception to this rule.
The concept of division of labor and subsequent specialization of work was first proposed by Adam Smith about 250 years ago, and in short, the division of labor not only among people within a company but also among companies within an industry or even countries on the scale of the global economy. It creates focus and deepens the results, with this introduction, it should be accepted that technical engineering services are also a specialized activity in the field of chemical engineering processes, and even if companies have process research and development units, so that the main focus is It is based on production, so they do not need these services.
By defining joint research projects with Persian Gulf University Bushehr in this field, Artin Azma company, in addition to benefiting from its research and development forces, also benefits from the university’s scientific capacity and looks at more detailed and deeper issues to achieve industrial solutions.
Currently, 85% of our oil economy is in the hands of private and government companies, what challenges did you face in this area?
State and semi-state companies are far ahead of the private sector in order to obtain financial resources and import the full production line and technology at a time when there was less problem of economic sanctions. But in this sector, the main challenge is the management of change and the slowness of the trends. However, for any reason, including sanctions, there is a need to change resources such as consumer or capital goods and intermediaries. Unfortunately, large state-owned companies are not agile enough in analyzing and changing resources, which can damage the production process of those companies and increase the cost of production, so the relevance of outsourcing the development of processes and technical engineering services in these companies The importance is doubled.
Is the presence of catalytic engineering technical services effective in the development of petrochemical processes?
It is definitely effective, as I said before, catalyst engineering technical services refer to a set of services related to the analysis, optimization and monitoring and control of catalysts. Process catalysts sometimes impose huge costs on consumer companies due to the presence of valuable metals in their structure as well as complex technologies in production, so to ensure that they have been able to create enough added value during their useful life. In the process, they need separate analyzes and real-time monitoring, and these services must be provided by a group that, in addition to mastering refining processes, also has sufficient mastery over how catalysts work in different operating conditions.
At the beginning of the conversation, you mentioned that we will face a shortage of gasoline, do you have a solution for this issue?
My suggestion is to use the capacity of the private sector, because it is more agile and because it does not have permanent job security and the opportunity to repeat mistakes, economic decisions are much stronger for it. To compensate for the imbalance, we need to strengthen the mini-refinery units, part of this is the strengthening of knowledge and the lesser part is the capital. Unfortunately, it is said that mini-refineries only sell crude oil, that private sector crude oil sales will become a long-term investment, much more likely than government crude oil sales, but the main issue in this regard is economic instability and people’s decisions. The fact that the production units may not have any certainty about their operating conditions and the amount of specific feed for the next year weakens the possibility of long-term investments for them.
Don’t you recommend importing to compensate for dissatisfaction?
Importing is a short-term solution, even when you are an oil country and your production capacity was once up to six million barrels. However, before the revolution, the target was to produce 8 million barrels per day, of which 7 million are from onshore crude oil and one million from oil. The continental shelf and the sea, of course, after the revolution, when issues such as protectionist production and the impact of long-term sanctions were raised, this amount decreased dramatically, and now we have half of that production, and of this amount, it is close to less than two million barrels in the country. becomes intermediate products and final products, it is clear that the economic decision is not to export everything that is produced from crude oil and allocate it to domestic refining units to create the value chain. The long-term economic decision is to bring whatever you sell raw in this way, this work requires a quick decision and implementation.
Is the development of sweetening and laboratory units in manufacturing companies an optimal solution and what will be the long-term results?
These measures can help to create more complexity and complete the value chain in smaller industrial units, but the main issue is that if the units operate independently, to what extent is it possible to waste costs? It can be seen that expensive laboratory equipments are left unused in industrial units due to the lack of proper analysis in their purchase, as well as process units and the use of catalytic technologies. It is clear that these issues require extensive cost-benefit analysis. It is implemented by specialist companies.
Regarding the unit you established in Bushehr, please explain more and what services it provides?
In Bushehr, with the investment of the private sector of Iran and Russia, we jointly produce products that lead to an increase in the quality of the products of refining units, among which we can mention demercaptanization catalysts, in addition to that, the company’s process engineering team located in the park Bushehr Persian Gulf Technology undertakes technical engineering services for the use of process catalysts or the design of industrial laboratories, for example, in your process and with your operating conditions, specifically for deodorization and sulfur reduction, as well as reducing costs. What amount of catalyst dose and when to be injected into the process is analyzed and checked by our team. These services are performed at the level of desulfurization catalysts, hydrotreating, isomerization, as well as all kinds of absorbents and molecular resins, active carbon and fuel additives such as Octane , Cetane , CFPP improver, as well as laboratory design, consulting in all kinds of devices and their supply. to be
What shortcomings can this service cover in this area?
In general, these services help industrial units in two ways, firstly by reducing production costs and secondly by increasing the quality of products. Specifically, we provide economic feasibility tables to increase the income of the units resulting from sweetening with the catalysts of this company, which shows with what initial investment and how much the income generation of the units has increased, in terms of laboratory equipment, the goal is to reduce Costs and product offerings are more durable.
You mentioned the unpleasant smell of mercaptan, how was it done traditionally in the past?
Using the mercaptanization process of gas condensates or oil derivatives is not a new process, the history of this method and the Merox method in general goes back to 1954 in America, which was developed by the UOP company, but mainly this process is used in gas refineries in the process Gas sweetening was done along with processes such as the absorption of acid gases by amine. In recent years, after the strengthening of oil sanctions against Iran, the unpleasant smell of mercaptan, in addition to the environmental problems it causes, indicates the origin of these condensates from Iran. Therefore, sweetened gas condensates can be bought and sold more easily in the world markets.
How do you evaluate the future of mini-refinery units with regard to the emergence of renewable energies? Considering the development plans of your company, do you have a glimpse of these trends?
This issue that you mentioned is a very important category that may become important for our country in the future. In the world, fossil fuels are shifting towards renewable energies with a slope, which is referred to as Energy Transition. The prediction is that this cost will decrease so much that it basically overshadows the use of fossil energy, in my opinion, such a possibility is not envisaged in the short term. None of the energy economy analysts have the analysis that we will not need fossil energies, even coal, in the short term, because in the energy economy there are concepts called Energy Density and Energy Cost, in other words, the amount of energy released per volume unit and also The cost of each megajoule of energy produced, for example, the energy intensity of coal is about 24 to 35 million BTU, while its cost is about 2 to 6 dollars per megajoule, this amount of course varies in geographical conditions and the amount of available technologies, but generally For example, in our country, these parameters are still in favor of hydrocarbon resources by a large difference. So, it is obvious that the priority for the countries that have rich hydrocarbon resources is to generate wealth from these resources and to use the resulting wealth for the development of modern technologies in order to improve renewable energy.
What kind of business do you have with the neighboring countries, whether Iraq, Pakistan, or the UAE?
So far, we have entered and exported in the two markets of Iraq and Pakistan. In Iraq, especially in the Kurdistan region, there are many industrial units for producing low-quality gasoline and diesel, among the challenges of these units are increasing the octane number, increasing the flash point, and reducing the smell. It is unpleasant and discolored from diesel. In addition to exporting catalyst, we have also exported technical engineering services and laboratory equipment to this region.
Which countries are the major producers of catalysts in the world?
America ranks first, followed by European countries such as France and Germany, followed by Russia and China, who are the main producers of catalysts in the world.