Foster Wheeler to Supply Heat-Recovery Steam Generator for Cogeneration Plant at Repsol's Cartagena Refinery

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Researched by Industrial Info Resources (Sugar Land, Texas)--The Global Power Group of Foster Wheeler Limited (NASDAQ:FWLT) (Clinton, New Jersey) has secured a contract from oil and gas firm Repsol Petroleo SA (Madrid, Spain), a subsidiary of Repsol YPF SA (NYSE:REP) (Madrid), to design, supply and erect a heat-recovery steam generator (HRSG) and auxiliary equipment for the latter's upcoming 40-megawatt (MW) cogeneration plant at the Cartagena refinery in Murcia, Spain. Foster Wheeler will also provide startup supervision services as part of the contract. The firm has received a full notice to proceed on the contract, the financial details of which have not been disclosed. The unit is scheduled to begin commercial operations in the first quarter of 2012.

The HRSG will be coupled with a PG-6581 gas turbine supplied by General Electric Company (NYSE:GE) (Fairfield, Connecticut) to recover heat from the gas-discharge stream and produce medium- and high-pressure steam for use in the refining process and electric power generation at the facility. The HRSG will also be equipped with a bypass stack and diverter, and post-firing and fresh-air capabilities in order to ensure continuous operation, even in the case of a combustion-turbine trip. The contract represents the seventh HRSG order placed with Foster Wheeler by Repsol.

The 40-MW cogeneration plant is being developed as part of a 3.2 billion euro ($4.6 billion) expansion and upgrade initiative that is aimed at doubling the distillation capacity of the refinery to 220,000 barrels per day (BBL/d). Repsol operates five refineries in Spain--in the cities of Cartagena, Petronor, La Coruna, Puertollano and Tarragona--with a combined capacity of 770,000 BBL/d. Of these, the 60-year-old Cartagena refinery is the smallest, with a capacity of 100,000 BBL/d. Commissioned in 1950, the refinery is the oldest refinery on the Iberian Peninsula and produces aromatic oils, asphalts, fuels, lubricant bases, and paraffins.

In January 2008, the company's board approved the expansion. The expanded refinery was scheduled to begin operations in 2011 and reduce Spain's growing dependence on imports for diesel. However, in April 2009, Repsol was forced to shut down the refinery because of the weak demand for middle distillates such as heating oil and jet fuel, which led to poor refining margins while the price of Russian Urals crude was on an upswing. Repsol's other refineries in Spain continued to run at full capacity, as they are capable of producing lighter, more profitable products.

The expansion project at Cartagena will see the addition of 20 new process units and 10 utility units, as well as extensive modifications of the existing units. The expansion will enable the refinery to process heavy/sour crude, and boost its hydrocracking capacity by 50,000 BBL/d, coking capability by 60,000 BBL/d and desulfurization capacity by 60,000 BBL/d. The expanded refinery will have a 76% conversion capacity, one of the largest in the world. More than 50% of the output from the expanded facility will consist of middle distillates, primarily diesels.

Fluor Corporation (NYSE:FLR) (Irving, Texas) is providing project management services for the expansion and upgrade project under a $1.3 billion contract awarded in February 2008. Foster Wheeler is also involved in the expansion of the refinery. In partnership with engineering, procurement and construction services provider Intecsa Industrial Engineering SA (Madrid), Foster Wheeler has been charged with engineering and supervision of the construction of two project segments: Block 1, which includes the vacuum distillation unit, coker, and gas concentration of the coker, merox and butadiene plants; and Block 3A, which includes the amines production, sulfur recovery, and acid water exhaustion units.

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