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Relationship between Values of Business Processes
and Need for Supervisory Control and Data
Acquisition (SCADA) Systems in Oil Refineries.
By
VINEETH KURUCHETI
With the assistance of
Nary Subramanian, Ph.D., Committee Chair
A research project submitted in partial fulfillment
Of the requirements for the degree of
Master of Science in the
Department of Computer Science
(CSE)
The University of Texas at Tyler
Tyler, Texas
May 2010
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The University of Texas at Tyler
Tyler, Texas
This is to certify that the Master’s Project of
VINEETH KURUCHETI
Has been approved for the research project requirement on 05/03/2010
For the Master of Computer Science degree
Approvals:
Dr. Narayanan Subramanian, Ph.D:______________________________
(Project Chair)
Dr. George M. Whitson, Ph.D: _________________________________
(Committee Member)
Dr. Kazem Mahdavi, Ph.D: ____________________________________
(Committee Member)
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Acknowledgement
I would like to thank my family and all my friends who have been a
constant source of encouragement and inspiration in my life. Their
support has helped me to courageously face the challenges that I
encountered in the process of pursuing my educational career.
I would like to thank the faculty of the Department of Computer
Science at The University of Texas at Tyler for providing me an
excellent platform to hone my Computer skills and achieve my Master’s
degree.
Special Thanks to my advisor, Dr. Narayanan Subramanian for his
constant encouragement and taking a lot of effort in completing this
project and being available at all the times that I needed him.
Thanks to my Committee members, Dr. George M. Whitson and Dr.
Kazem Mahdavi who spent their valuable time in looking into my
report.
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Contents
Abstract ………………………………………………………………………...…7
Chapter 1
Introduction...................................................................................................... 8
Chapter 2
2.1 Importance of a Business Process Methods & Control……………………… 10
2.2 Business Process Management Lifecycle (BPM)……………………………. 11
2.3 The Importance of Business Process Improvement…………………………. 12
a How Can Business Process Improvement Aid Company Performance?...... 13
Chapter 3
SCADA system….………….…..…………………………….…….…………… 14
3.1 What is a SCADA system ……………………….…….……………………. 14
3.2 Layers of SCADA system...….………….…………………………….…….. 15
Chapter 4
Oil Refinery Business Processes….………………………...……………….…. 18
4.1 Business Processes in an Oil Refinery……………………………………… 18
a Crude selection…………………………………………………………….. 18
b Crude transportation………………………………………………………. 19
c Crude processing ………………………………………………………….. 19
d Product demands …………………………………………………………. 20
4.2 Barrel of Crude Oil………………………………………………………..… 21
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Chapter 5
Simulation……………………………………………………………………….. 22
5.1 Oil Refinery Business Processes…………………………………………..... 22
5.2 Oil Refinery Business Processes Simulation………………………………. 23
5.3 Phases in Oil Refinery Business Processes………………………………… 24
5.4 What Is The Profit-Margin For Refining Crude Oil Into Gasoline………… 37
5.5 Cost Estimation for processing 2 million barrels of crude Oil………………. 37
Chapter 6
SCADA Requirements…………………………………………………………. 41
6.1 The 2 Basic Components of SCADA……………………………………….. 41
6.2 Where SCADA can be used…………………………………………………. 42
6.3 SCADA System Operation………………………………………………….. 42
6.4 Parts enable a SCADA system to perform four types of tasks……………. 43
6.5 SCADA Requirement in Business Processes of an oil refinery…………… 45
a SCADA system for Oil Pipelines………………………………………….. 45
b SCADA system for storage tanks and reactors……………………………. 46
Chapter 7
Relationship between Business values and SCADA Requirements…………. 48
7.1 SCADA Technology evolves to create new market dynamics……………. 48
7.2 Determining the phase in the business processes of an oil refinery where
SCADA system is much needed to increase the profit-margins…………. 49
7.3 Phases in oil refinery where RTU’s and Master Units are must need…….. 50
SCADA need in oil refinery…………………………………………………….. 52
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Chapter 8
Conclusions and future work ……………………………………….….……… 53
Chapter 9
References…………………………….……………………….…….…………... 54
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Abstract
The SCADA (Supervisory Control and Data Acquisition) system consists of a Master
system that communicates with the Remote Terminal Units (RTU) to gather data and check the
values for the optimum functioning of the oil refinery. The SCADA system checks various
parameters like the pressure, temperature, density of the oil inside the pipeline’s and storage
tanks in the oil refinery. In this project we first find the business processes that are involved in
the oil refinery and estimate the total cost and profits made on refining crude oil by simulating
using AccuProcess Simulator (APS). Secondly, we use the business processes values to find out
what phases in oil refinery require SCADA system for monitoring. We find that, higher the value
of business process the more SCADA equipment is needed.
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Chapter 1
Introduction
As the price of crude oil continues to remain high, refineries across the globe are
increasingly focused on initiatives to protect their margins. Flexibility in changing the processes
to get aligned to the dynamic business scenario is being aimed by the refiners. Refinery
executives are keenly examining on probable effective ways of managing & motivation their
people, managing their business process and changing technology accordingly, to get tune their
operations with dynamic supply chain in the business. [1]
Modern crude optimization techniques have challenged organizations to rethink the way
they conduct business both internally and externally, i.e. how efficiently and effectively their
entire supply chain is managed. Supply Chain Management (SCM) is one such business
function that has benefited substantially from optimization software advances and solutions.
The primary goal of SCM is to maximize profit by integrated management of material and
transactional flows within a business and to customer and partner companies.
The petroleum refining industry has effectively embraced the software solutions (e.g.
SCADA systems) to optimize the business supply chain to maximize the profit margins and
create order in the chaos of numerous opportunities and challenges. The supply chain of a
typical petroleum refining company involves a wide spectrum of activities, starting from crude
purchase and crude transportation to refineries, refining operations, product transportation and
finally delivering the product to the end user. The nature of the value chain is such that its
economics are extremely complex and heavily linked. For example, the process of selecting the
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right crude is linked not only to the transportation costs involved in delivering it to the refinery,
but it must take into consideration the refinery configuration, capabilities and constraints in
converting the crude into products, as well as the product volume and price fluctuations.
In this project we will discuss about business values and SCADA system, later we
simulate the business processes of an oil refinery in order to calculate the cost involved in the oil
refinery. After that, we will discuss about the SCADA requirements in the oil refinery, from the
values produced by the simulation we determining the phase in the business processes of an oil
refinery where SCADA system is much needed to increase the profit-margins.
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Chapter 2
This chapter briefly describes the Business Process Management Lifecycle (BPM) and its
importance in oil refinery.
2.1 Importance of a Business Process Methods & Control
A business process or business method is a collection of related, structured activities or
tasks that produce a specific service or product (serve a particular goal) for a particular customer
or customers. It often can be visualized with a flowchart as a sequence of activities.
There are three types of business processes: [2]
1. Management processes, the processes that govern the operation of a system. Typical
management processes include "Corporate Governance" and "Strategic Management".
2. Operational processes, processes that constitute the core business and create the primary
value stream. Typical operational processes are purchasing, manufacturing, marketing
and sales.
3. Supporting processes, which support the core processes. Examples include accounting,
recruitment, and technical support.
A business process begins with a customer’s need and ends with a customer’s need
fulfillment. Process oriented organizations break down the barriers of structural departments and
try to avoid functional silos.
A business process can be decomposed into several sub-processes, which have their own
attributes, but also contribute to achieving the goal of the super-process. The analysis of business
processes typically includes the mapping of processes and sub-processes down to activity level.
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Business Processes are designed to add value for the customer and should not include
unnecessary activities. The outcome of a well designed business process is increased
effectiveness (value for the customer) and increased efficiency (less costs for the company).
Business Processes can be modeled through a large number of methods and techniques. For
instance, the business process modeling notation is a business process modeling technique that
can be used for drawing business processes in a workflow.
2.2 Business Process Management Lifecycle (BPM)
The business process lifecycle consists of the steps shown in Figure 1. [3]
Figure 1: Business process lifecycle

Model and Simulate: Business process owners create a high-level design of the tasks to
be done and a list of the required resources. This is usually done graphically using a
drawing package such as Microsoft Visio or a proper modeling tool such as Popkin's
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System Architect. The modeling tool may also be used to perform optional simulation
steps during which hypothetical scenarios are run to identify critical paths and
bottlenecks.

Implement and Deploy/Execute: Developers convert the business process definitions
into an executable process model linking systems, APIs, and people through workflows.
The resulting executable process is then deployed to a BPEL or BPM engine for
execution.

Monitor and Optimize: Deployed business processes are monitored to measure key
performance indicators and other metrics. Process throughput and utilization metrics can
be fed into a simulation tool to derive the optimal execution mode by using real data (e.g.
historical).
2.3 The Importance of Business Process Improvement
In order for a business to make money and to remain effective over time, leadership must
continually plan and oversee the organization from the top-down. If businesses have a clear
understanding of their day-to-day operations and processes, they stand a better chance of longterm success. A crucial component in understanding, solidifying and enhancing operations is a
practice known as business process improvement. [4]
Business process improvement is defined as a systematic approach that allows companies
to optimize their core processes in order to obtain the most efficient results. When companies
engage in process improvement, they will start to define:
-
The goals and objectives of the business itself
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-
The purpose of the business
-
Who their customers really are
-
What strategic improvements need to be made?
-
Which processes should be improved or eliminated to ensure maximum efficiency and
profitability
When it comes to business process improvement, the overall goal is to determine which
company processes are the most efficient and what processes are problematic. The company will
then be able to determine the steps it needs to take to reach its’ goals. For example, in cases
where a company has inefficiencies or is spending too much money on resources that it does not
need, it would evaluate how to best improve its process so that it is efficient and able to
maximize its’ performance. Business process mapping is typically used to achieve these goals.
2.3.a How Can Business Process Improvement Aid Company Performance?
In today’s struggling economy, more and more businesses are starting to realize that in
order to survive they must improve their existing processes and address areas of concern. Often
times, businesses struggle in one way or another, whether they have poor customer service or
their sales are simply down. If a business wants to correct problems and optimize its
performance, it will have to take a close look at its existing processes and start making
improvements. Process improvement begins when a company identifies its problem areas. The
company must then document and measure how these problems are adversely impacting business
and revenue. Finally, the company must manage the problem and find effective solutions. By
finding solutions, the company will make necessary improvements and will ultimately perform
better over time. When business process improvements are implemented correctly, the end result
is usually higher performance and increased monetization.
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Chapter 3
SCADA system
This chapter briefly describes the SCADA system and its application in oil refinery.
3.1 What is a SCADA system?
SCADA stands for Supervisory Control and Data Acquisition. It is an industrial control system
used to control and monitor a process. SCADA consists of the following subsystems. [5]

Human machine interface (HMI)

Supervisory control system

Communication infrastructure

Remote terminal units(RTUs)
 A Human-Machine Interface or HMI is the apparatus which presents process data to a
human operator, and through this, the human operator, monitors and controls the process.
 A supervisory control system collects data on the process and sends commands
(control) to the process.
 The Remote Terminal Units (RTUs) are small computerized units deployed in the field
at specific locations to gather reports from sensors within the process.
 Communication infrastructure connects the supervisory system to the Remote
Terminal Units.
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3.2 Layers of SCADA system
Generally, a SCADA system has three layers, SCADA master, communication media, and local
control system shown in Figure 2. [6]
SCADA
Figure 2: Example of a SCADA system
 SCADA is an acronym for "Supervisory Control and Data Acquisition", meant to explain the
very essence of the system.
 SCADA is a technology permitting to collect and process data received from the remote (in
terms of distance from the control center) objects, and transmit commands via cable or radio
communication systems.
 SCADA may either eliminate the necessity of the on-going technological process personnel's
presence, or drastically reduce the number of inspection visits to the system's objects.
 SCADA is a technological control and management system providing for highly efficient
cost effective production.
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 SCADA enables a technological process operator to monitor and control equipment status, to
open and shut valves or motors, to view each of the technological process parameters all
from a single Central Control Room.
 SCADA systems are based on modern microprocessor and networking technologies enabling
the system designer to implement a scalable application that can grow with expanding needs.
3.2.a SCADA master
The SCADA master is set up at central locations (multiple masters can be established) of
your operational organization. SCADA master consists of three main parts, SCADA console,
SCADA server, and MTU (Master Terminal Unit). The console is HMI (Human Machine
Interface) for your operation. The server contains database(s) for historical trend of relevant data.
MTU is a terminal that communicates with RTUs (Remote Terminal Unit). Each piece of
SCADA master equipment is a node in SCADA master LAN (Local Area Network). The number
and locations of SCADA master are determined for each application, depending on operation
plan, total system reliability and other design terms.
3.2.b Communication media
For the data communication between MTU and RTU, communication media will be
chosen from leased line, microwave radio, UHF/VHF radio, fiber optic transmission, or satellite
communication. If you need to own new communications by yourself, installation cost of
communication media tends to have a large impact on your total investment. Before you choose
the best one for communication, it is important to consider your requirements, local installation
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constraints, communication service availability, and total system reliability. Back up circuits
using different communication media from the main circuits are sometime provided to increase
the strength of communication circuits.
3.2.c Local control system
The local control system includes all necessary control functions required for a local
station and communication capability with SCADA masters. For a relatively small station such
as a block valve station, a small RTU is suitable. On the other hand, a DCS (distributed control
system) is often adapted to a terminal or booster station. It is crucial to design a local control
system to safely continue controls in case of communication circuits failure with SCADA
master(s). If incase oil pipeline is running cross-country, the power supply for stations often
poses a problem. In such case, solar cells or a small power station is built to a local station.
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Chapter 4
Oil Refinery Business Processes
This chapter briefly describes the Business Processes involved in the oil refinery.
4.1 Business Processes in an Oil Refinery
Modern optimization techniques have challenged organizations to rethink the way they
conduct business both internally and externally, i.e. how efficiently and effectively their entire
supply chain is managed. Supply Chain Management (SCM) (Refer to Figure 3) is one such
business function that has benefited substantially from optimization software advances and
solutions. The primary goal of SCM is to maximize profit by integrated management of material
and transactional flows within a business and to customer and partner companies.
4.1.a Crude selection
Modern petroleum refineries are designed to process a variety of indigenous and
imported crudes. As the crude cost is about 90% of the refinery input cost, the selection of
optimum crude mix is extremely important to achieve higher margins. However, the number of
options for buying the crudes under a fluctuating price scenario and transporting them to
refineries are so enormous that it is very difficult to evaluate all the crudes and decide on the
optimum crude mix for the refinery. Refineries buy crudes both on term contracts with leading
suppliers and also by spot purchases from the market. The optimum selection of term and spot
crudes is extremely difficult when multiple refineries are involved and work in an integrated
scenario. [8]
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4.1.b Crude transportation
Once the crudes are selected and purchased, the focus is to optimize the transportation
cost from the crude suppliers to refineries. The transportation cost can be minimized by
considering the multiple options available for cargo sizes, sea routes, loading and unloading
infrastructure facilities, taxes and duties, etc.
4.1.c Crude processing
The crudes often land at refinery sites as a mix of various crudes and various options of
crude blending are evaluated before it is processed. The ultimate challenge a refinery faces is
processing the crudes in the best possible manner and maximize the $/bbl (dollars per barrel) for
the crude input. Determining the “best possible” option is a very difficult task, as modern day
refineries are built with complex processing schemes, having a combination of various
technologies for heavy ends upgrading, product quality improvement, efficient fuel usage and
controlling refinery emissions. The most common configuration includes catalytic cracking,
hydro cracking and thermal cracking to maximize the bottom of the barrel. The other process
technologies like catalytic reforming, hydro treating and sulfur recovery are a must to comply
with stringent environment and product quality regulations.
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Figure 3: Typical Supply chain of Petroleum business
4.1.d Product demands
The product demands, quality and prices drive the entire crude processing and secondary
unit operations. Multiple streams with multiple blending options to make different grades of a
product further make the task of refinery planning cumbersome and demanding.
Moreover, the future promises to add even more complexity through additional product
specifications, environmental norms, changing feedstock, product prices, mergers and
acquisitions.
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4.2 Barrel of Crude Oil
A Barrel (Shown in Figure 4) of crude oil
contains
50% of Gasoline
40% Diesel Fuel, Jet Fuel, Kerosene
10% Residual Fuel
Figure 4: A barrel crude oil contain
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Chapter 5
Simulation
This chapter briefly describes the simulation of Business Processes in an oil refinery.
5.1 Oil Refinery Business Processes
An oil refinery or petroleum refinery is an industrial process plant where crude oil is
processed and refined into more useful petroleum products, such as gasoline, diesel fuel, asphalt
base, heating oil, kerosene, and liquefied petroleum gas. Oil refineries (Referred in Figure 5) are
typically large sprawling industrial complexes with extensive piping running throughout,
carrying streams of fluids between large chemical processing units. In many ways, oil refineries
use much of the technology. [9]
Figure 5: Oil refinery plant
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5.2 Oil Refinery Business Processes Simulation
Accuprocess simulator was used to simulate the business processes of an oil refinery.
Figure 6: Oil Refinery Business Processes Simulation
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5.3 Phases in Oil Refinery Business Processes
Business processes of an oil refinery were divided in to 8 phases.
5.3.a Pumping Crude Oil
In this activity a supertanker containing crude oil is considered. The oil from the tanker is
pumped into oil pipelines in order to transport the crude to the refinery.
Figure 7: Pumping Crude Oil (refer to Figure 6)
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5.3.b Crude Transportation
Crude oil that is pumped out from the supertanker is transported to the oil refinery
through pipelines.
Figure 8: Crude Oil Transportation (refer to Figure 6)
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5.3.c Crude Storage
In this activity the crude that was traveled through the pipelines are stored in the storage
tanks as shown in Figure 6.
Figure 9: Crude Storage (refer to Figure 6)
5.3.d Oil Refinery Initial Phase
This is the initial phase of the oil refinery technical process, in this phase the crude that
was stored in the storage tanks was subjected to Crude Distillation and Vacuum Distillation.
i) Crude Distillation
• Process Objective:
– To distill and separate valuable distillates (naphtha, kerosene, diesel) and atmospheric gas oil
(AGO) from the crude feedstock. [10]
• Primary Process Technique:
– Complex distillation
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ii) Vacuum Distillation
• Process Objective:
– To recover valuable gas oils from reduced crude via vacuum distillation.
• Primary Process Technique:
– Reduce the hydrocarbon partial pressure via vacuum and stripping steam.
Figure 10: Oil refinery Initial phase (refer to Figure 6)
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5.3.e Oil Refinery Intermediate Phase
In this phase the distilled crude oil is subjected to Hydro treating, Coking, Fluidic
Catalytic Cracking and Hydro cracking in order to separate, purify as well as to upgrade variety
of feeds from the distilled crude.
i) Hydro treating Process
• Process Objective:
– To remove contaminants (sulfur, nitrogen, metals) and saturate olefins and aromatics to
produce a clean product for further processing or finished product sales.
• Primary Process Technique:
– Hydrogenation occurs in a fixed catalyst bed to improve H/C ratios and to remove sulfur,
nitrogen, and metals.
Figure 11: Oil Refinery Intermediate Phase (Hydro treating) (refer to Figure 6)
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ii) Coking Process
• Process Objective:
– To convert low value resides to valuable products (naphtha and diesel) and Coker gas oil.
• Primary Process Technique:
– Thermo cracking increases H/C ratio by carbon rejection in a semi-batch process.
Figure 12: Oil Refinery Intermediate Phase (Coking) (refer to Figure 6)
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iii) Fluidic Catalytic Cracking
• Process Objective:
– To convert low value gas oils to valuable products (naphtha and diesel) and slurry oil.
• Primary Process Technique:
– Catalytic cracking increases H/C ratio by carbon rejection in a continuous process
Figure 13: Oil Refinery Intermediate Phase (Fluidic Catalytic Cracking) (refer to Figure 6)
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iv) Hydro cracking Process
• Process Objective:
– To remove feed contaminants (nitrogen, sulfur, metals) and to convert low value gas oils to
valuable products (naphtha, middle distillates, and ultra-clean lube base stocks).
• Primary Process Technique:
– Hydrogenation occurs in fixed hydro treating catalyst beds to improve H/C ratios and to
remove sulfur, nitrogen, and metals. This is followed by one or more reactors with fixed
hydro cracking catalyst beds to dealkylate aromatic rings, open naphthene rings, and
hydrocrack paraffin chains.
Figure 14: Oil Refinery Intermediate Phase (Hydro Cracking) (refer to Figure 6)
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5.3.f Oil Refinery Final Phase
In this final phase the separated mixture will undergo Isomerization, Catalytic Reforming
and Alkylation in order to produce the end products like Gasoline, Hydrogen, and Aromatics.
i) Isomerization Process
• Process Objective:
– To convert low-octane n-paraffins to high-octane iso-paraffins.
• Primary Process Technique:
– Isomerization occurs in a chloride promoted fixed bed reactor where n-paraffins are converted
to iso-paraffins. The catalyst is sensitive to incoming contaminants (sulfur and water).
Figure 15: Oil Refinery Final Phase (Isomerization) (refer to Figure 6)
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ii) Alkylation Process
• Process Objective:
– To combine light olefins (propylene and butylene) with isobutane to form a high octane
gasoline (alkylate).
• Primary Process Technique:
– Alkylation occurs in the presence of a highly acidic catalyst (hydrofluoric acid or sulfuric
acid).
Figure 16: Oil Refinery Final Phase (Alkylation) (refer to Figure 6)
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iii) Catalytic Reforming Process
• Process Objective:
– To convert low-octane naphtha into a high-octane reformate for gasoline blending and/or to
provide aromatics (benzene, toluene, and xylene) for petrochemical plants. Reforming also
produces high purity hydrogen for hydro treating processes.
• Primary Process Technique:
– Reforming reactions occur in chloride promoted fixed catalyst beds; or continuous catalyst
regeneration (CCR) beds where the catalyst is transferred from one stage to another, through a
catalyst regenerator and back again. Desired reactions include: dehydrogenation of naphthenes
to form aromatics; isomerization of naphthenes; dehydrocyclization of paraffins to form
aromatics; and isomerization of paraffins. Hydro cracking of paraffins is undesirable due to
increased light-ends make.
Figure 17: Oil Refinery Final Phase (Catalytic Reforming) (refer to Figure 6)
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5.3.g Product Storage
All the Refined Products are collected and stored. Storage is an important phase in the oil
refinery in order to increase the price of the final product.
"You may only pay $40 a barrel, but you could sell it today, lock in a future price much,
much higher, just a few months down the road and take advantage of that. You could lock in, per
barrel, a $3 or a $5 or, if you could hold the oil long enough, maybe even a $10 profit.” [11]
Figure 18: Refined product storage (refer to Figure 6)
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5.3.h Marketing & Supply
Marketing and Distribution of petroleum products takes place on a vast, global scale.
Every day, hundreds of millions of companies and individuals buy these products at wholesale or
directly from retail outlets as shown in Figure 6.
Figure 19: Marketing & Supply (refer to Figure 6)
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5.4 What Is The Profit-Margin For Refining Crude Oil Into Gasoline?
As of 1999, for every gallon of gasoline refined from crude oil, U.S. oil refiners made an
average profit of 22.8 cents. By 2004, the profits jumped to 40.8 cents per gallon of gasoline
refined. In the specialized California market where the gasoline must conform to the
requirements of the California Air Resources Board, refinery margins were even higher. In fact,
this helped Exxon, the largest company, report a profit (as of February 2008) of $40.6 billion.
Nevertheless, one financial tracking institution reported that the profit-margins have now
dropped to about 29.6 cents a gallon or around 60 percent lower than a year ago.
Generally speaking, since there are so many variables to consider, precise cost breakdowns
are difficult to ascertain. According to the Energy Information Administration (EIA), however,
which issues the “Official Energy Statistics from the U.S. Government” the average cost at the
pump for a gallon of gasoline is broken down as follows:

74% - Cost of the crude oil

11% - Taxes

10% - Refining costs

5% - Distribution and marketing
5.5 Cost Estimation for processing 2 million barrels of crude Oil
In this cost estimation we estimate the total cost of 2 million barrels of crude oil to refine
(including man power) and determine the profit for one gallon of refined oil by comparing with
the current oil prices in the market.
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5.5.a Cost for buying crude oil
A supertanker holds roughly 2 million barrels or 84 million gallons of crude oil.
1 barrel contain 42 gallons
Crude-oil futures rose above $82 a barrel
Ship cost of a crude oil 2000000 * 82 = 164,000,000 $
Shipping crew wages = 22,000 $
5.5.b Cost for transporting crude oil to the refinery
Here there are different types for transporting crude to refinery (e.g. Road transportation,
Pipelines, etc.)
We are considering pipelines because it was the cheapest of all.
Pipeline with a capacity of 600 million barrels per day (mb/d) costs nearly 2.52 cents per barrel.
So for transporting 2 million barrels is 2000000 * 2.52 cents = 5040000 cents = 50,400 $ (shown
in Figure 20)
5.5c Cost for refining crude oil
Total cost of the technical processes in the refinery.
Figure 20: Simulated values for total cost of each activity
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Technical processes
Cost (Process cost including man power)
Crude Distillation/Vacuum Distillation
3,970,432
Hydro treating
2,942,950
Coking
2,711,620
Fluidic Catalytic Cracking
2,902,320
Hydro cracking
2,803,030
Isomerization
2,842,800
Alkylation
2,514,940
Catalytic Reforming
2,651,730
Total
23,339,822 $
5.5.d Cost for Storing refined oil
"You may only pay $40 a barrel, but you could sell it today, lock in a future price much,
much higher, just a few months down the road and take advantage of that. You could lock in, per
barrel, a $3 or a $5 or, if you could hold the oil long enough, maybe even a $10 profit." Storage
cost per year 5, 54,439 $ (shown in Figure 20)
5.5.e Cost for Marketing and Distribution of refined oil
Every day, critical business outcomes depend on seamless supply and trading around the
globe. Marketing and Distribution of petroleum products takes place on a vast, global scale.
Every day, hundreds of millions of companies and individuals buy these products at wholesale or
directly from retail outlets.
Trading & Supply cost 5,230,000
Marketing & Distribution cost 5,230,000
Total cost 10,460,000 $
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Overall Estimation
Overall Cost 164,000,000 (crude oil) + 22,000 (shipping crew wages) + 50,400 (transporting
crude) + 23,339,822 (process cost including man power) + 5, 54,439 (storage cost) + 10,460,000
(marketing and distribution)
 198,096,661
Tax’s on each gallon of refined oil 23cents according to the
California Energy Commission [14]
So for 84 million gallons of refined oil => 84000000 * .23 = 19,320,000 $
Total refinery cost with Tax’s = 198096661 + 19320000 = 217,416,661
Today each gallon of refined oil cost 3.00 $ (retail price)
So for 84,000,000 gallons of refined oil cost => 84000000 * 3 = 252,000,000 $
Profit made on 84 million gallons of refined oil => 252000000 -217416661 = 34,583,339
Profit on 1 gallon of refined oil 34,583,339 / 84,000,000 = 41.1 cents
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Chapter 6
SCADA Requirements
This chapter briefly describes the requirements for SCADA in an oil refinery.
6.1 The 2 Basic Components of SCADA
Any SCADA scenario involves 2 basic components [7]
1. Things you want to monitor and control
2. Devices you will use to perform monitoring and controlling functions
As stated above, SCADA systems are used to collect data and control processes at the
supervisory level. Therefore, one of the major components of a SCADA system is having
something that you want to control. This could be a system or process, or even specific
machinery. These SCADA-monitored elements could be just about anything, from an oil refinery
plant, a power-generation system, an organization’s communication network, or even a simple
switch.
To monitor and control these elements using a SCADA system, you will need devices to
collect data from them and issue commands. This network of monitoring and control devices
makes up your SCADA system. Using sensors (discrete or analog) and control relays, the system
can collect information about processes and control individual pieces of equipment. The system
is governed by a SCADA master, that collects data from monitoring devices and issues controls
in response (either automatically or at the request of human operators).
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6.2 Where SCADA can be used
While SCADA can be used to manage any kind of equipment, SCADA systems are
typically for the automation of industrial processes where humans are unable to manage complex
or rapid operations. These are often fast-paced processes dealing with extremely delicate and tiny
parts and equipment that are simply too difficult for human operators to monitor with any
consistent level of accuracy.
6.3 SCADA System Operation
There are four parts common to every SCADA system:
1. Sensors (either digital or analog) and control relays - These are input/output devices
that monitor and control the managed processes and equipment.
2. Remote Terminal units (RTU’s) - These are devices deployed in the field at specific
sites and locations. RTU’s gather information locally from the sensors to report back to
the SCADA master unit.
3. SCADA master units- SCADA master units are the main, user-end component of the
entire SCADA monitoring system. They are also sometimes referred to as the SCADA
HMI (Human-Machine Interface). The master provides the central processing capability
for the SCADA system. Master units connect the human operators to the system with a
browser interface that allows the system operator to respond to data gathered from all
parts of the network.
4. The communications network- The communication network provides the connection
between the SCADA master unit and the RTU’s in the field. It is the all-important link
between the far-flung elements of a geo-diverse operation.
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6.4 Parts enable a SCADA system to perform four types of tasks:
1. Data collection- A SCADA system is composed of large numbers of sensors that collect
inputs into a system, or measure the output levels of a system or process. The information
collected by these sensors is collected by the RTU’s locally, and then forwarded to the
SCADA master, where reports and alarms are presented to the network operator.
Sensors can be classified as two types, either discrete or analog. Discrete sensors collect
information about simple events, whereas analog sensors can provide more detailed
information that can fall within a range of values, rather than a present/not present type of
situation. Analog sensors are particularly useful in measuring environmental factors, such
as temperature and humidity, battery levels, fuel levels, and more.
2. Communication of data across the network- To monitor geo-diverse operational
systems from a centralized location, you need a communications network. This network
provides you with a means to transport all information collected across the system.
SCADA communications generally take place on Ethernet and IP over SONET. To
alleviate security concerns when transporting sensitive data, communication of data
should be done over internal LAN/WANs, not the public Internet.
SCADA uses protocol communication methods, so input and output devices cannot
interpret or create SCADA communications on their own. RTU’s interpret information
from attached sensors and transmit it to the SCADA master (HMI). In turn, the RTU
receives control commands in protocol format from the SCADA master, and forwards
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these commands to the appropriate control relays. This allows the SCADA master to
control individual operational processes throughout the network from a single location
3. Information reporting- A SCADA system presents data to operators via the SCADA
HMI (Human-Machine Interface). Along with presenting this data, the SCADA master
station also performs many other tasks for network operators. The master continuously
monitors all sensors and alerts the operator when there is a Change-of-State (COS) event
within the managed system.
The master presents a comprehensive view of the entire network of devices, and presents
more specific information about the managed equipment and processes when the system
operator requests it. The master also presents reports and summarizes historical trends of
data gathered by the system.
4. System control functions- A SCADA solution with control functions can respond to
COS events anywhere in the system by automatically issuing related, user-specified
commands. If you have an advanced SCADA master, this can be done without any
human intervention at all, resulting in instantaneous response to dynamic problems and
threats. Advanced systems also allow overriding of automatic controls as the need occurs.
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6.5 SCADA Requirement in Business Processes of an oil refinery
SCADA is required in different phases of an oil refinery, in order to manage complex or
rapid operations which are difficult for human to operate and monitor. Oil refinery needs
SCADA for different purposes like, to manage the temperature and pressure in the reactors, to
control the flow of fluids in the pipelines, to collect the data and values for testing the purity of
the refined products and also need sensors to detect the tank levels.
6.5.a SCADA system for Oil Pipelines
Oil is transported from the oil wells or oil containers to the refineries and refineries to
various places through the pipelines. Since the oil pipelines travel through hundreds of miles, a
single system cannot monitor the entire pipeline. Hence many devices like field instruments,
programmable logic units and RTU’s are placed at different places throughout the pipeline.
These field instruments and the programmable logic units are connected to RTU’s and the
SCADA system is used to monitor all these RTU’s. Various parameters are being sensed by
these devices namely pressure, temperature of the oil flowing inside the pipeline, density of the
liquid flowing etc.
Since there are many RTU’s located at different places throughout the pipeline and since
all these RTU’s communicate with the SCADA master system (as shown in Figure 22), rapid
exchange of data takes place. The RTU’s sends the data to the SCADA master system and the
SCADA master system checks if everything is working well or if there are any changes to be
made. If there are any changes to be made, the SCADA master sends a message to the respective
RTU and it performs the required action.
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Any minor change in the pipeline can be detected by the SCADA master system and the
required action can be taken. The application of SCADA has reduced huge amount man power
requirements in the field which in turn has reduced the expenditure
Figure 22: Oil pipeline SCADA System Architecture
6.5.b SCADA system for storage tanks and reactors
SCADA Systems are often used to maintain oil storage tank and reactor levels with
offsite pump stations. The SCADA system monitors and controls the oil level in the storage
tanks and reactors, provides tank level control from several offsite pump stations, allows
operators to specify set-points, displays graphical representations of the tank and the system,
provides alarm features, and generates trending and historical data. [12]
The systems are programmed to start and stop pumps based on operator-adjustable tank
level set-points. The pressure transmitter continuously measures a tank level variable and
transmits signal representing the level to the local RTU. (As shown in Figure 23)
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RTUs were installed at each offsite location. For each given pump, there is a start and
stop command based on tank level and an alternation scheme. The system monitors the tank level
and controls pumps according to the set-points. If the tank level drops, the system activates a
pump, monitors the levels, and stops the pump. It also monitors for potential pump failures or
failure conditions, and keeps track of the pump usage for allotment purposes. Operator override
pump control and pump disable is permitted.
Different operation performed by SCADA system in storage tanks and reactors

Monitor high and low levels in the tanks.

Fill them when a certain level is reached.

Calculated and store the volume used.

Monitor the level in the main feed tank.

Alarm when a certain level is reached to notify purchasing.

Plot the usage of chemicals vs. time, process, or any other parameter.

Turn pumps, valve, switches on and off. [13]
Figure 23: Storage tank SCADA System Architecture
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Chapter 7
Relationship between Business values and
SCADA Requirements
In this chapter we discuss and determine the phase in the business processes of an oil
refinery where SCADA system is more needed to increase the profit-margins.
7.1 SCADA Technology evolves to create new market dynamics
The role of SCADA (Supervisory Control and Data Acquisition) systems continues to
grow with requirements for more quality monitoring, efficiency monitoring, real-time OEE
(Overall Equipment Effectiveness), sub metering and alarm monitoring. Remote Terminal Units
(RTU) technology provides monitoring for remote locations operating wirelessly. [15]
The worldwide SCADA market reflects the impact of new technology on SCADA
components and cost effective communications for knowledge transfer. SCADA components are
easier to integrate and provide vastly improved capabilities and functionalities. Communication
limitations have been eliminated. Consequently, SCADA systems are being used for a range of
operational improvement applications and linking these to business processes for a variety of
purposes both internal and external to the enterprise.
Supported by intelligent field devices, expanded communication networks, and improved
compatibility with IT, SCADA can now provide a wealth of information and knowledge to help
users modify their business processes. The effective use of today's SCADA systems requires
their usage be leveraged to encompass both robust control and automation functionalities and,
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more importantly, the capability to support higher-level systems that overlap into enterprise
optimization for utility and energy companies.
7.2 Determining the phase in the business processes of an oil refinery where
SCADA system is much needed to increase the profit-margins
The four major SCADA system components include the Master Terminal Unit (MTU),
the Remote Terminal Unit (RTU), Communication Equipment and SCADA Software
Setting a SCADA system involves placing sensors at right places and connecting those
sensors to a Remote Terminal Unit (RTU) which are placed at the specified sites and locations.
They gather information locally from the sensors to report back to the SCADA master unit.
Master units are larger computer consoles that serve as the central processor for the SCADA
system.
Cost to setup a true SCADA system is approximately $30,000, SmartSCADA provides a
complete packaged solution, with all of the components necessary for a successful system: [16]
--SCADA Master Station
--Key Applications
--SOFTWARE
--Substation Controller (RTU’s)
--Training
--Project Management
--Service and Support
--Optional Communications
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7.3 Phases in oil refinery where RTU’s and Master Units are must needed
SCADA system is much needed where there is a huge amount of money invested in the
refinery, because SCADA is a technological control and management system which provides
highly efficient cost effective production.
Since 75% of the total investment goes for the purchase of crude oil. Only 25 % of the
amount was invested in different phase of an oil refinery.
7.3.a Pumping crude oil
In this phase a single sensor and a single RTU is sufficient, in order to acquire the data
like rate at which the system is pumping crude oil and to calculate the amount of crude oil
pumped. In this phase there is no need of a Master Unit.
7.3.b Transporting crude oil
Cost estimation in this phase for transporting 2 million barrels of crude oil = 50,400 $
Transporting crude trough pipelines, in this phase 4 -5 RTU’s are sufficient to record the
flow of crude in the pipeline, and to detect the leakage in the pipeline. This phase need a Master
Unit to monitor and control the flow as well as to control the valves.
7.3.c Crude and final products storage tanks
Estimated cost in this phase for storing 2 million barrels of crude oil = 5, 54,439 $
This phase need only sensors to detect the temperature and pressure in the oil tanks,
sensors also detect the oil levels in the tanks and activate alarm in case oil level increase beyond
certain values. There is no need of a Master Unit or an RTU in this phase.
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7.3.d Technical processes in the oil refinery
Estimated cost in this phase for processing 2 million barrels of crude oil = 23,339,822 $
This is most important phase in the oil refinery where there is a much need of RTU’s and
the Master Unit. Each technical process needs at least 5 – 6 sensors in order to record the levels
in the reactors (as shown in Figure 24) and also for record the rate at which liquid flow in the
pipes between the reactors, each technical process needs at least one RTU in order to transmit the
recoded values by the sensors to the Master unit. This phase require a Master unit to control the
flow of liquids and to control the pumps and valves that are in this phase. There are 7 technical
processes in the oil refinery each requires an RTU and at least 5 sensors to monitor. Sensors and
RTU’s needed in this phase are 60 – 70 sensors, 7 -10 RTU’s and 1 MTU. (Shown in Figure 25)
Since huge amount is invested in this phase, SCADA system is much needed in this phase.
Figure 24: Example to show how many RTU’s and sensors needed for each technical process
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SCADA need in oil refinery
Phases of Oil
refinery Business
processes
1) Pumping Crude Oil
2) Crude
Transportation
3) Crude Storage
4) Oil Refinery Initial
Phase
5) Oil Refinery
Intermediate Phase
6) Oil Refinery Final
Phase
7) Product Storage
8) Marketing & Supply
Sub phases
Crude Distillation /
Vacuum Distillation
Hydro treating
Coking
Fluidic Catalytic
Cracking
Hydro cracking
Isomerization
Catalytic Reforming
Alkylation
supply & Trading
Marketing &
Distribution
Number of
Sensors
needed
Number of
Remote
Terminal
Units (RTUs)
needed
Number of
Master
Terminal Unit
(MTUs) needed
1
20 – 25
0
5–8
0
1
1
0
0
15
2
9
7
3
1
1
1
11
6
8
8
8 – 10
0
0
67
10
1
2
1
1
1
1
0
0
0
0
0
Figure 25: Table showing how many sensors, RTUs and MTUs required for each phase in the
business process of an oil refinery
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Chapter 8
Conclusions and Future work
Before the development of the SCADA systems, we had to send people around the
refinery to close valves and turn on pumps at various times. This requires lot of effort and man
power. The use of SCADA systems became popular in 1960’s as a need to arise to more
efficiently monitor and control the state of remote equipment. A problem with early SCADA
systems is that they required human oversight to make decisions as well as human support to
maintain the information system. With the technology growing rapidly, the human intervention
in the SCADA system is becoming very low. Human Intervention is needed only for some very
rare events.
In this project we discussed about the business values and SCADA system, we also
simulated the business processes of an oil refinery by using Accuprocess simulator and calculate
the cost involved in the oil refinery. After that, we discussed about SCADA requirements in the
oil refinery, from the values produced by the simulation we determined the phase in the business
processes of an oil refinery where SCADA system is much needed to increase the profit-margins.
This system can be further developed to work on some other issues like the security
scenarios, profit-margins, or doing a little deeper research into the system and improving the
business values of the refinery.
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Chapter 9
References
[1] Business Process Improvement in Refinery by Christopher Fonseca - Practice Director,
Seshasai Kandrakota Practice Head – Energy Resource & Utilities for Tata Consultancy
Services,
http://www.tcs.com/SiteCollectionDocuments/White%20Papers/tcs_ERU_whitepaper_BusinessProcess-Improvement-Refinery.pdf
[2] Business process From Wikipedia, the free encyclopedia.
http://en.wikipedia.org/wiki/Business_process
[3] Supporting the Business Process Lifecycle Using Standards-Based Tools by Bhagat Nainani
- product development manager, Oracle Application Server division
http://bhagatnainani.sys-con.com/node/79226/mobile
[4] The Importance of Business Process Improvement by Julia James
http://blog.businessmapping.com/2009/03/30/the-importance-of-business-process-improvement/
[5] SCADA - Wikipedia, the free encyclopedia
http://en.wikipedia.org/wiki/SCADA
[6] What is SCADA system? – VEESTAWORLD
http://www.veesta-world.com/pages/services_scada_page.htm
[7] SCADA Knowledge Base – DPS telecom
http://www.dpstele.com/dpsnews/techinfo/scada/scada_knowledge_base.php
[8] PETROLEUM REFINERY: COMPLEXITY OF OPERATIONS AND THE NEED AND
SCOPE OF OPTIMIZATION – GLOBALSPEC
http://www.cheresources.com/refinery_planning_optimization.shtml
[9] Oil refinery - From Wikipedia, the free encyclopedia
http://en.wikipedia.org/wiki/Oil_refinery
[10] Oil Refinery Processes - A Brief Overview – www.processengr.com
www.processengr.com/ppt_presentations/oil_refinery_processes.pd
[11] Oil Storage at Record Levels as Speculators Await Higher Prices – Voice of America
http://www1.voanews.com/english/news/a-13-2009-01-23-voa61-68809857.html
[12] SCADA Applications – Data Flow Systems
http://www.dataflowsys.com/services/scada-applications.php
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[13] REMCO Engineering's – Water systems and Controls
http://www.remco.com/scada.htm
[14] Estimated 2010 Gasoline Price Breakdown & Margins Details - California Energy
Commission
http://energyalmanac.ca.gov/gasoline/margins/index.html
[15] SCADA Systems for Oil & Gas Industry Worldwide Outlook Study Brochure [PDF] –
SCADA Systems for Oil & Gas Industry.
www.arcweb.com/StudyBrochurePDFs/Study_scadagas_ww.pdf
[16] SmartSCADA Package – Hometown Connections and Survalent Technology
http://www.hometownconnections.com/utility/scada.html
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