What is an oil refinery?

A refinery is an industrial complex that manufactures petroleum products, such as gasoline, from crude oil and other feedstocks. Many different types of refineries exist across the country. What differentiates one refinery from another are their capacities and the types of processing units used to produce these petroleum products. This article describes some key refinery processes and provides links to more in-depth articles about the individual processes.1

Refineries have a distillation column and then can have any combination of secondary processing units depending on the type of crude oil they process and the products they want to produce. A refinery's capacity refers to the maximum amount of crude oil designed to flow into the distillation unit of a refinery, also known as the crude unit. The simplest refineries have a distillation column and nothing else. These refineries are often referred to as topping refineries.

Source: U.S. Energy Information Administration, Today in Energy, July 5, 2012.

Crude oil is made up of a mixture of hydrocarbons, and the distillation process aims to separate this crude oil into broad categories of its component hydrocarbons, or "fractions." Crude oil is first heated and then put into a distillation column, also known as a still, where different products boil off and are recovered at different temperatures. Lighter products, such as butane and other liquid petroleum gases (LPG), gasoline blending components, and naphtha, are recovered at the lowest temperatures. Mid-range products include jet fuel, kerosene, and distillates (such as home heating oil and diesel fuel). The heaviest products such as residual fuel oil are recovered at temperatures sometimes over 1,000 degrees Fahrenheit. The diagram above presents a stylized version of the distillation process. The simplest refineries stop at this point.

More sophisticated refining equipment such as catalytic crackers, reformers, and cokers reprocess the heavier fractions into lighter products to maximize the output of the most desirable products.

A distillation column separates crude oil into different petroleum products based on differences in boiling points. By itself the crude distillation column has low yields of high-value transportation fuel products. Many of the other unit operations involve chemical processes that create products by either reshaping hydrocarbons, combining small hydrocarbons into larger hydrocarbons, cracking larger hydrocarbons into smaller higher-value hydrocarbons, or removing impurities such as sulfur. Each secondary processing unit after the distillation column has a specific purpose, whether it is increasing separation; upgrading low-value products, like residual fuel oil, to high value products, like distillate; increasing octane; or enhancing environmental compliance by removing sulfur and other pollutants.

See the following articles for a more in-depth description of refinery processes:

Catalytic reforming – Today in Energy, April 9, 2013Distillation and refinery capacity – Today in Energy, July 5, 2012Refinery complexity – Today in Energy, October 11, 2012 Vacuum distillation – Today in Energy, December 10, 2012Fluid catalytic cracking – Today in Energy, December 11, 2012Hydrocracking – Today in Energy, January 18, 2013Delayed coking and fluid coking – Today in Energy, January 28, 2013Alkylation – Today in Energy, February 13, 2013

Two key characteristics of crude oil are density and sulfur content. Density ranges from light to heavy, while sulfur content is characterized as sweet or sour. The purchase costs of various crude oils depend mainly on density and sulfur content, and other factors such as location and transportation costs.

Refining capacity in the Gulf Coast has large secondary conversion capacity including hydrocrackers, cokers, and desulfurization units. These units enable the processing of heavy, high sulfur (sour) crude oils like Mexican Maya that typically sell at a discount to light, low sulfur (sweet) crudes like Brent and Louisiana Light Sweet.

Many East Coast refineries have less secondary conversion capacity, and in general they process crude oil with lower sulfur content and a lighter density. This lighter, lower sulfur crude oil commands a premium price on world markets. See related article — Today in Energy, September 26, 2012

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