TUCKED away on the outer perimeter of the Jebel Ali free zone lies the Middle East's newest and most innovative refining unit. It may not win many prizes for size, but the 2,500 barrel a day (b/d) facility can claim full credit for technological innovation. It boasts one of the most important breakthroughs in the recent history of refining: a revolutionary process technology, known as Gadgil Interline, which converts low value fuel oils into the more highly prized middle distillates.

The Gadgil Interline process, developed by India's Gadgil Western Corporation, aims to cure one of the biggest headaches facing refiners. Conventional refining leaves 10-14 per cent at the bottom of the barrel for every barrel of crude processed. To crack it further, the residue needs to be heated above 600 C. However, in older refineries, charring and burning occur before such temperatures are reached. The result is that the bottoms are sold on as fuel oil at prices which are often lower than the cost of the original feedstock.

'The problem was how to get rid of the contaminants, which prevent the bottoms from heating up,' says Gadgil Western Corporation chairman, Nandan Gadgil, who worked with the US' Interline to find a way of getting better value from the bottom of the barrel. 'What the process does is to effectively split the product into two streams. The first, representing 84 per cent of the volume, contains no contaminates and allows the product to be heated up to produce middle distillates. The remaining 16 per cent becomes the bottom, which is then sold on as fuel oil.'

The technology uses fuel oil with a viscosity of 180-380 CST as the basic feedstock. The middle distillates produced include gasoline, automotive and marine diesel, lube oil base stock and bunker fuel oil. An added advantage of the technology is that it produces no emissions. 'One hundred per cent of what goes in, comes out,' Gadgil says. He is so confident about the new technology that the company is building four plants around the world. The Jebel Ali facility is the first and took only three months to plan and six to build. The recently-commissioned phase one development is primarily a demonstration unit. 'We have had to prove to the banks and the industry that the idea works,' says Gadgil.

A second phase expansion is already underway. It will boost capacity to 7,500 b/d and lift total investment at the site to $38 million, when it is completed next March. The company is also pressing ahead with a 7,500-10,000 b/d unit at Hidd in Bahrain (Bahrain, MEED 23:6:95).

Gadgil's development strategy in the region is straightforward. 'Our overriding aim is to be complementary to the local environment,' the chairman says. 'What we are looking to do is to establish units next to existing refineries. This will allow us to use existing tank farms and to have a plentiful supply of feedstock.' This approach also enables Gadgil to return the processed fuel oil to the refinery, which can then market the product through its established marketing channels.

Joint venture partnerships are also being assessed, although each will have one important proviso. 'We don't mind a joint venture. But one of our basic terms is that the technology process will remain outside any agreement,' Gadgil says. This is what happened in Bahrain, where the company entered into a joint venture with Mannai Corporation just for the plant's infrastructure.

Angus Hindley