July 2021
In the coming decades, the shifting demand for fossil-based transportation fuels will be the defining factor that will transform existing oil refining capacity. Future refineries will be equipped with flexible technology solutions that can enable them to make a wide variety of chemicals and intermediates.

Currently, most refineries are focused on the production of gasoline and distillate transportation fuels. However, energy analysts predict that mandated fuel economy standards, as well as growth in alternative drivetrains and shared mobility services will impact the overall global demand for transportation fuels over the coming decades.  As a result, more refineries are considering diversifying their offerings to a variety of petrochemicals.  

An oil refinery or petroleum refinery is an industrial process plant where crude oil is transformed and refined into useful products such as petroleum naphtha, gasoline, diesel fuel, asphalt base, heating oil, kerosene, liquefied petroleum gas, jet fuel and fuel oils. 

Petrochemicals feed stock like ethylene and propylene can also be produced directly by cracking crude oil without the need of using refined products of crude oil such as naphtha. The crude oil feedstock has typically been processed by an oil production plant. There is usually an oil depot at or near an oil refinery for the storage of incoming crude oil feedstock as well as bulk liquid products.

Oil refineries are typically large, sprawling industrial complexes with extensive piping running throughout, carrying streams of fluids between large chemical processing units, such as distillation columns. In many ways, oil refineries use much of the technology and can be thought of, as types of chemical plants.  The Reliance Industries owned Jamnagar refinery is part of the world’s largest oil refining complex, with a processing capacity of 1.2Mbpd. Some modern petroleum refineries process as much as 0.9Mbpd.


Raw or unprocessed crude oil is not generally useful in industrial applications, although "light, sweet" (low viscosity, low sulphur) crude oil has been used directly as a burner fuel to produce steam for the propulsion of seagoing vessels. The lighter elements, however, form explosive vapours in the fuel tanks and are therefore hazardous. Instead, the hundreds of different hydrocarbon molecules in crude oil are separated in a refinery into components that can be used as fuels, lubricants, and feedstocks in petrochemical processes that manufacture such products as plastics, detergents, solvents, elastomers, and fibres such as nylon and polyesters.

Different boiling points allow the hydrocarbons to be separated by distillation. Since the lighter liquid products are in great demand for use in internal combustion engines, a modern refinery will convert heavy hydrocarbons and lighter gaseous elements into these higher-value products.

Oil refineries operations will typically process about a hundred thousand to several hundred thousand barrels of crude oil a day. Because of the high capacity, many of the units operate continuously, as opposed to processing in batches, at steady state or nearly steady state for months to years. The high capacity also makes process optimisation and advanced process control very desirable.


The majority of the feed crude oil is converted to petroleum products, which includes several classes of fuels. Oil refineries also produce various intermediate products such as hydrogen, light hydrocarbons, reformate and pyrolysis gasoline. These are not usually transported but instead are blended or processed further on-site. Chemical plants are thus often adjacent to oil refineries or a number of further chemical processes are integrated into it. Technical reasons and environment protection demand a very low sulphur content in all but the heaviest products, so it is transformed to hydrogen sulphide via catalytic hydrodesulphurisation and removed from the product stream via amine gas treating. Using the Claus process, hydrogen sulphide is afterward transformed to elementary sulphur to be sold to the chemical industry.

According to the composition of the crude oil feed and depending on the demands of the market, refineries can produce different shares of petroleum products. The largest share of oil products is used as "energy carriers", i.e. various grades of fuel oil and gasoline. These fuels include or can be blended to give gasoline, jet fuel, diesel fuel, heating oil, and heavier fuel oils. Heavier (less volatile) fractions can also be used to produce asphalt, tar, paraffin wax, lubricating and other heavy oils. Refineries also produce other chemicals, some of which are used in chemical processes to produce plastics and other useful materials.

First Stage Processing

The crude oil distillation unit (CDU) is the first processing unit in virtually all petroleum refineries. The CDU distils the incoming crude oil into various fractions of different boiling ranges, each of which is then processed further in the other refinery processing units. The CDU is often referred to as the atmospheric distillation unit because it operates at slightly above atmospheric pressure.



In a typical crude oil distillation unit the incoming crude oil is preheated by exchanging heat with some of the hot, distilled fractions and other streams. It is then desalted to remove inorganic salts (primarily sodium chloride).

Following the desalter, the crude oil is further heated by exchanging heat with some of the hot, distilled fractions and other streams. It is then heated in a fuel-fired furnace (fired heater) to a temperature of about 398 °C and routed into the bottom of the distillation unit.

The cooling and condensing of the distillation tower overhead is provided partially by exchanging heat with the incoming crude oil and partially by either an air-cooled or water-cooled condenser. Additional heat is removed from the distillation column by a pump around system.

The overhead distillate fraction from the distillation column is naphtha. The fractions removed from the side of the distillation column at various points between the column top and bottom. Each of the side-cuts (i.e., the kerosene, light gas oil, and heavy gas oil) is cooled by exchanging heat with the incoming crude oil.

All of the fractions (i.e., the overhead naphtha, the side-cuts, and the bottom residue) are sent to intermediate storage tanks before being processed further.

Shift Towards Integration

In the medium term AME anticipate a shift towards integrated refinery models, where refining and petrochemical units are interconnected, is an approach designed to make refinery operations more sustainable.

The conventional model, where refiners generate revenue primarily by processing crude oil to produce transportation fuels, is increasingly under threat from falling fuels demand, particularly in Europe.

Shell refineries for example have in recent years shifted towards a crude-to-chemicals mode providing site flexibility in producing fuels, lubricants, and chemical products as market demands shift.