Status Update

Status Update
Whiting Refinery Modernization Project

February 2008

BP continues to progress with detailed engineering and design for the planned $3.8 billion investment to upgrade and modernize the Whiting refinery in northwest Indiana.  

This project will enable the facility to refine more crude oil from Canada, increase motor fuels production by about 1.7 million gallons each day, and sustain its positive contribution to the economy of the Midwest US, including jobs for thousands of BP employees and contractors in northwest Indiana. The project will also provide a significant increase to the tax base of northwest Indiana. Additionally, this project benefits US energy security and fuel supply reliability for the Midwest by tapping into growing oil sands production in the Alberta province of Canada.  

An important aspect of the current phase of the project is to design and integrate improvements that will protect the environment.  A significant portion of the BP Whiting refinery modernization budget – more than $1.4 billion – is allocated for environmental improvements.  For example, BP will invest about $150 million in upgrading existing water treatment facilities and refinery processes to ensure that water discharges from the plant continue to be well within state and federal limits that are established to protect human health, aquatic life and Lake Michigan’s water quality.  

In order to progress to the construction phase of the project, BP is working with state and federal regulators on necessary permits.  

Air Permits

On February 5th the Indiana Department of Environmental Management (IDEM) issued for public review and comment the draft construction and operations air permits that BP needs to proceed with its planned Whiting refinery investment.  

BP submitted an air permit application to IDEM at the end of October 2007.  IDEM conducted a comprehensive technical regulatory review, including consultation with the US Environmental Protection Agency (EPA). The draft permits propose to regulate air emissions at the refinery to more stringent limits than currently allowed.  

The proposed stricter air permit limits follow a five-year trend of measurable decreases in air emissions from the Whiting Refinery. Criteria pollutants in 2006 were 68 percent lower than those in 2001 and these emissions will decrease an additional seven percent by 2011.

As depicted in the graph below, once the project is completed the Whiting refinery will be able to process more Canadian crude oil and produce more gasoline and diesel, while still reducing overall regulated air emissions.  Although two constituents are expected to rise -- particulate matter (PM10) and sulfur dioxide -- both will remain below currently authorized limits. The refinery modernization will result in an overall reduction of regulated air emissions of 620 tons per year.

Click on chart to expand view

The overall reductions will be achieved by investment in state-of-the-art pollution control devices that include technology to produce lower-sulfur fuels, specialized burners and controls to reduce nitrogen oxide emissions from heaters and boilers, sealing sources of particulate and volatile organic compound emissions and improved automated controls that optimize process units for lower emissions. Removing older, less efficient equipment will also contribute to lower regulated air emissions.

Copies of the draft air permits will be available for public review at various IDEM offices, the Whiting Public Library and online at the agency’s website (www.idem.in.gov ).  IDEM plans to conduct the public comment period through Friday, March 21, 2008, and will hold a public meeting and a public hearing the evening of Friday, March 14, 2008, at the Hammond Civic Center.

Water Discharge Permit

In summer 2007 the Indiana Department of Environmental Management (IDEM) issued a renewed water discharge permit for the Whiting refinery.  Although the new permit includes increased limits for total suspended solids (TSS) and ammonia, it is protective of human health, aquatic life and Lake Michigan’s water quality.  This was confirmed in an independent review conducted by Professor James Barnes and detailed in the report he issued in December 2007.

However, BP committed to meet lower limits for TSS and ammonia contained in the refinery’s previous permit. BP will not proceed with the refinery modernization plan unless there is confidence the refinery can operate at these lower limits.  The company is pursuing four parallel tracks to investigate options for meeting this commitment:

• BP and consultants with global refinery and other industry experience are evaluating and designing source control and water treatment options;
• BP is working with CH2MHill, a global engineering and environmental consultant, to conduct detailed analysis of ideas presented by others to determine whether they may be applicable to the Whiting refinery;   
• Science and engineering experts from the Purdue Calumet University Water Institute and Argonne National Laboratory are studying emerging technologies and approaches to minimize discharges into Lake Michigan; and
• BP is participating with the Petroleum Environmental Research Forum (PERF), an industry consortium that is researching and developing environmental technologies for the industry.

Greenhouse Gas Emissions

The Whiting modernization is expected to increase carbon dioxide (CO2) emissions about 30-40 percent – currently projected to be in the range of 1.5 to 2 million tons per year.  The project is working to minimize GHG emissions by replacing older equipment with new, state of the art, high energy efficiency process units. The Whiting Refinery will also be using lower carbon fuels for its energy source.

BP is advocating for a single, mandatory US greenhouse gas emissions registry and a national greenhouse gas emissions cap and trade program.  BP also supports the development of policies to promote technological innovation and the growth of low-carbon businesses. Examples include carbon capture projects and increased investments in alternative energy.  BP has a long history of global leadership on the issue of managing and reducing greenhouse gases and will continue efforts in this area.

Path Forward

Additional construction-related permits and key milestones are ahead of BP in the coming months.  The company is engaging directly with stakeholders to provide updates and address questions and concerns. BP is committed to finding ways to achieve the important objectives of U.S. energy security, increased gasoline supply, economic development and environmental stewardship. BP has thousands of employees who live, work and raise their families in the US Midwest.  BP believes it is possible to protect the environment and meet energy needs, which are fundamental for a sustainable quality of life in the region.   For more information about BP’s Whiting refinery modernization project, visit http://whiting.bp.com .