In the second half of 2016, China’s Ministry of Industry and Information Technology published the five-year plan for intelligent manufacturing(2016-2020) which highlights requirements on traditional sectors, including refining sector, about the “smart factory” transformation. The Plan emphasizes on improving the management of key equipment, enhance the basic support capabilities of software and increase the level of application integration. Based on the statistics, the total output value of China’s intelligent manufacturing is about 1 trillion yuan. But the downstream industry, which is at the core position in transformation, is still at the initial stage.
In recent years, China’s refining and petrochemicals industry deeply suffers from overcapacity and sluggish demand, struggling to seek ways to improve profits and corporate competitiveness. The “smart manufacturing” policy showed the way for the industry. After years of development, the oil enterprises like Sinopec and CNOOC has taken a big step towards the “smart factory”. North Huajin Chemical Industries Group, as a national key refining, petrochemicals, and fine chemicals project development platform, has also made great progress on it.
North Huajin Chemical Industries Co., Ltd is a China-based company principally engaged in the production and sale of petrochemical products and chemical fertilizers. The Company’s main products are categorized into petrochemicals, chemical fertilizers, fine chemicals and plastic products.
As the organizing committee, we are honored to announce that the chief engineer of the North China Huajin Chemical Industry Group and the chief scientist of the China North Industries Group Corporation, Mr. Tang Zhifang will speak at Refining & Petrochemicals World, China 2017, which will be held at 13-14th, November 2017. We have a small talk with him about his view on “smart factory” transformation in china’s refining and petrochemicals industry. Here is the summary of the talk:
Can you specify the topics you will include at the conference?
I will share some experiences and views on “smart factory”. In accordance with the National 13th Five-Year Plan, as well as the China North Industries Group Corporation’s requirements, some of our factories need to achieve “intelligent production” in China’s 13th Five-Year National Development Plan period. Our strategy is “From the Refinery to the Ethylene Plant, Realize the Overall Optimization of the Refining Project”. The works that we’re planning include: ERP and information management; the optimization of equipment operation, which I think is the core of the “smart factory”.
Can you specify how do you optimize the equipment operation?
OK. Such as atmospheric and vacuum distillation unit, to achieve overall optimization we have to change the production process based on the changes of the composition of crude oil. In fact, the optimization of feedstock is the optimization of procurement. We currently use the PIMS which is an entire production optimazition software. It tells you which crude oil to buy and the ratio of it. But it’s not enough. If we want to achieve intelligence, we should monitor the real-time composition of crude oil using NRM to optimize the separation.
The second is the ethylene plant. The crucial part of ethylene production process is cracking furnace technology. The principle of the optimization is same as the atmospheric and vacuum distillation, the different part is that atmospheric and vacuum distillation is a separation process and the cracking is a chemical reaction process. So we can monitor the real-time composition of crude oil to control the composition of pyrolysis gas. About the COT, we can control the dilution ratio to control the reaction process.
To achieve our goals, we are applying for a financial support from the government. So far the possibility has confirmed.
Can you share the updated project information for us?
We’re not only focusing on the current project with a capacity of 6 million tons per year of oil refining and 400,000 tons per year of ethylene, but also working on the new project in Liao Dong, which we plan to invest 70 billion yuan on it and produce 15 million tons refining products and 1 million tons ethylene per year.
The last question, what challenges has Huajin Group faced when you develop the “smart factory”?
The biggest problem is the acceptance of the concept. No matter what, people need time to digest the new thing and figure out how much economic benefits it will generate. In my view, developing “smart factory” is not so-called “following the hot topics of the industry”. We develop it for two purposes. First is to increase the productivity. We can only achieve the high productivity through optimization. The efficiency of workers can not possibly catch up the machine. That’s how things work. The second is that we can solve many of the management problems through the intelligent transformation. Take the truck loading system as an example, we made some efforts on how to prohibit the cheating years ago and developed some ways like arranging supervisors or adding security cameras. But if you apply the ERP systems and some other intelligent systems, the space leaving for cheating will shrink automatically. So the “smart factory” is not just about the efficiency, is also related to many management problems. We need to learn the concept of the “industry 4.0” from Germany. Of course, they go faster and investment more. But we must do what we can do now.