Floating downstream

What are your predictions for the market? Where do you see the market growing the most?
India’s oil demand touched 4 million bpd for the first time in 2015. Demand was driven upward by a weak monsoon and strong fuel demand as new private car sales exceeded 2 million units for the first time in history. Steady demand for these key products and surging demand for petrochemicals are set to drive India’s demand to nearly 8 million bpd by 2035 in spite of energy efficiency improvements.
Both olefins and aromatics will be very competitive sectors over the next 5-10 years, with new low-cost supplies emerging from US and Middle Eastern producers who have advantaged access to feedstocks.  The markets will be oversupplied in the near term and marginal growth will be met by this low-cost leading edge.  Both China and India import much of their feedstock and thus have higher input costs, but should also have lower operating costs.  The key will be whether these industries can operate with entrepreneurial flair or are burdened by more bureaucratic practices like centralised planning and bloated headcount.
Over the past 20 years, Indian refiners have invested in capacity at a rate that outpaced oil demand growth. This export hub strategy has left India with a refined product surplus for all products except LPG and some speciality products. Going forward, this gap will close as demand increases faster than planned refining capacity, squeezing export volumes, especially during times of seasonal demand. New capacity plans by both public sector undertakings and private refiners will be needed to keep pace with India’s demand growth. The timing and location of these expansions will be dependent on the pace of economic development, population dynamics and corporate strategy.

So what is your strategy to excel in this price-sensitive market?
Much of our consulting is focused on maximising return from your existing assets with no or minimal investment. We  also focus on improving reliability to enable our customers to take advantage of price and demand volatility. Our experience with our customers using our software and consulting services shows that the benefits gained are significantly more than the cost of the services, with some customers capturing ten times their investment.

How do you think India’s petrochemicals sector compares to other international markets?
In terms of operations there is a divide between the state-owned and private sectors.  The private sectors are very good operators; the state is more encumbered by bureaucracy and thus has less room to manoeuvre.
In terms of the outlook for the industry, the prospects are excellent – much of India’s oil demand is based around transport fuels and petrochemicals feedstocks. You can’t grow a country the size of India through this current stage of growth without creating a lot of demand for both.
There are real opportunities for India’s petrochemical sector but its success will come down to implementation.  I’d wager on a bright future for India’s petrochemical sector if it can adopt good practices like production-centred operations and lean operations.  As the country grows richer, the wage bill for talented employees will rise. There will also be competition for this talent in the Middle East.  It will be essential to use the workforce efficiently, keep the assets running to a high availability and reach the highest energy utilisation practices.

Could you give us some insight into what your company does?
KBC is a leading independent consulting and technology company offering services to simulate the complete hydrocarbon value chain: from reservoir to refinery.
If you are conceiving a large project, say an expansion, KBC can evaluate configuration options and technology choices to make a recommendation tailored to our client’s situation and production objectives. In addition to licensor selection, we also help energy and process integration among licensing units.
For example, if you are looking at fluidised catalytic cracking, hydrocracking or any other technology, there will be two or three different licensors. KBC helps select the right technology for your product out of all the big providers using our software packages: Petro-SIM and SIM Reactor Suite, which can be applied across different technologies, and ranks them based on their particular specifications.
For existing assets, we have consultants that perform data and experience driven analysis to identify opportunities for improvement. We facilitate workshops to prioritise opportunities and develop implementation plans for selected opportunities. We try to challenge the design and operating window to get the maximum value from the equipment and the best results from every capex outlay.

Could you tell us more about your software?
We have Petro-SIM, SIM Reactor Suite and our Energy Suite for refineries with refinery wide flowsheets and our upstream packages, including a compositional package called Multiflash for hydrate, wax, asphaltene and mercury estimates, and an integrated production modelling tool called Maximus for production forecasts and flow assurance studies. Maximus can also provide field development plans which advise clients at what rate a certain investment will meet a certain production rate. Maximus can predict this information for the lifetime of the asset based on the network of producing wells, hydraulics and related factors.

How do you market your services to the larger companies in the hydrocarbons industry?
KBC has a knowledgeable, regionally based sales force who maintain close relationships with our clients. KBC hosts public seminars and training courses to share our expertise as well as hosting software user group meetings for existing customers. We are currently hosting a series of events with themes including operational excellence and production centred operations. We also present papers at industry conferences.

Would you like to boost your presence in the upstream sector?
We are trying to increase our presence in the upstream sector by providing marginal field asset improvement programs using a combination of our software for flow assurance studies and our consulting experience to identify production improvements.