OIL SHALE AS A RAW MATERIAL FOR CHEMICALS

OIL SHALE AS A RAW MATERIAL FOR CHEMICALS: CHALLENGE IMPLEMENTING CIRCULAR ECONOMY Marti Viirmäe Viru Keemia Grupp AS CONCEPT Head of Technical and Development Dept

CO-AUTHORS Diana Berseneva, MSc Kitty Teimann Sales Manager VKG Oil AS Chemicals Safety Project Manager Viru Keemia Grupp AS

Väiksem pealkiri Proudly working for the past 93 years and are still inspired by local oil shale

GEOGRAPHICAL SALES DISTRIBUTION OF THE PRODUCTS AND SERVICES

CIRCULAR ECONOMY • Brussels, 2. 12. 2015 COM(2015) 614 final • Value of products, materials and resources is maintained in the economy for as long as possible • Generation of waste minimised • Aims to generate new and sustainable competitive advantages for Europe • Production processes: promoting best practices through BREF documents • Management of Tailings and Waste-Rock in Mining Activities BREF (2009). • Estonian Shale Oil Production Best Available Technique reference document: waste generation and waste management, wastewater also included

OIL SHALE • The virtues and challenges of our „brown gold“ imbedded in its composition: • Organic part 10 -65% (kerogen ~25 -35% in oil shale used as raw material) • Including ~2% S; ~0, 5% N • Mineral part 15 -70% (calcite, dolomite) • Sand-clay part 15 -40% • Including ~0, 5% SO 3 and ~12, 3% Fe. S 2 1. http: //www. ttu. ee/public/m/Mehaanikateaduskond/Instituudid/soojustehnika-instituut/oppematerjalid/kyteventilatsioon/5. _Polevkivi. pdf 2. https: //dspace. utlib. ee/dspace/bitstream/handle/10062/27643/plevkivi_keemiline_koostis. html 3. I. Rooks, 1987

MOLECULAR MODEL OF ESTONIAN KEROGEN Lille, Ü. , Heinmaa, I. , Pehk, T. Molecular model of Estonian kukersite kerogen evaluated by 13 C MAS NMR spectra. Fuel, 2003, Vol 82, I 7, pp 799 -804

VKG VALUE CHAIN

SANKEY 2016 SEMI-COKE GAS OIL SHALE PROCESSING AT PETROTER PLANT MARKETABLE SHALE OILS STEAM AND DISTRICT HEATING TO EXPORT COKE AND BITUMEN

CIRCULAR ECONOMY: opportunities in the value chain • Energy/energy efficiency of Petroter plants ~87% • Focus on statistics: focus on mineral matter. Ash defined as hazardous waste? ! • Focus on economic value: focus on chemicals & “molecule management”

FOCUS ON ECONOMIC VALUE LOG 10(sales price) LOG 10(amount) le Sha oil R 2 -M 5 -M ate R on dr ohy 5 m -MR ol ey Hon A scenario of shale oil and fine chemicals production at VKG

MAIN COMPONENTS OF TOTAL OIL SHALE ALKYLRESORCINOLS • 5 -methylresorcinol (orcinol) • 4, 5 -dimethylresorcinol • Resorcinol • 2 -methylresorcinol • 5 -ethylresorcinol • 2, 5 -dimethylresorcinol

ALKYLRESORCINOLIC PRODUCTS (1) We developed different fractions of alkylresorcinols depending on content of 5 -methylresorcinol and boiling temperatures: Boiling temperature, 0 C Trade name Content of 5 methylresorcinol, wt. , % 80 -90 Honeyol 80 270 -320 with subsequent crystallization Honeyol 270 -320 min. 48 Rezol >270 min. 40

ALKYLRESORCINOLIC PRODUCTS (2) We produce pure chemicals with concentration of main component at 99, 99 wt. %: • 2 -methylresorcinol • 5 -methylresorcinol monohydrate • 5 -methylresorcinol anhydrous • 2, 4 -dimethylresorcinol

APPLICATION Honeyol™, Rezol™ - substitute for phenol, bisphenol A and resorcinol in adhesive resins Honeyol™ 80, Honeyol™ - substitute for resorcinol in wood and rubber adhesives, flame retardants, UV-stabilizers 5 -methylresorcinol (monohydrate and anhydrous) – raw material for organic synthesis of pharmaceuticals, pigments, cosmetics 2 -methylresorcinol - component of hair dyes, raw material for organic synthesis of liquid crystals 2, 4 -dimethylresorcinol - raw synthesis of pharmaceuticals material for organic

ADVANTAGES OF ALKYLRESORCINOLS (Rezol, Honeyol, Honeyol 80) CHARACHTERIS TIC RESORCINOL PHENOL ALKYLRESORCINOL S 12, 2 1 18, 6 5000 -6500 EUR/t 600 -900 EUR/t 2000 -3500 EUR/t Molecule structure Reactivity with formaldehyde* Price *Resorcinol: Chemistry, Technology and Applications R. Durairaj, 2010

ADVANTAGES OF ALKYLRESORCINOLS (Honeyol, Honeyol 80) Alkyl substituent in molecular structure of alkylresorcinol gives to end-products an additional properties. Higher, compared with resorcinol: • water resistance; • UV-resistance; • heat resistance;

ADHESIVE RESINS We developed adhesive resins for tyre and rubber industry: Trade name International equivalent Application SF-281 Pre-condensed non-styrenated Alkylresorcinol POWERPLAST PP-1861 T, Resin PENACOLITE-B-19 S, TECHNIC Can be used as resorcinol component of the Dry B 19 S Bonding system for adhesion of synthetic tyre cord and brass plated tyre cord to rubber. SF-282* TECHNIC R 75, TECHNIC R 50, PENACOLITE® R-2170, PENACOLITE® R-50 SF-284 Pre-condensed Styrenated Resorcinol Resin POWERPLAST PP-1863, Can be used as resorcinol component of the Dry PENACOLITE-B-20 S, TECHNIC Bonding system for adhesion of synthetic tyre B 20 S cord and brass plated tyre cord to rubber. Alkylresorcinol mixture based liquid dipping resin for polyester chords * SF-282 have different resin solids level, which is 60%

OIL SHALE AS RAW MATERIAL: CHEMICALS PRODUCTION HISTORICALLY • Sodium thiosulfate • Ligno, Ligno Extra preservative • Rubber softener used in tyre recycling • EPO glue • Sulphur technical • «Нэрозин» - stabilisation of sand against wind erosion • HPM-3 - hydrophobic plugging material for oil wells • Bitumen mastic • Corrosion inhibitor • Benzene • Toluene • Benzoic acid • Lacquer solvent • Linoleum glue • Phenolin- phenolics for skin treatment (veterinarian)

OIL SHALE AS RAW MATERIAL: SOME POSSIBLE CHEMICALS PRODUCTION • Aerogels • Methanol • LPG • S 2 • Resins • Alkylresorcinols • . . .

CHALLENGE: R&D COSTS CAPEX: 10 MEUR CAPEX: 5 MEUR CAPEX total: 20 MEUR CAPEX: 5 MEUR

CHALLENGE: R&D COSTS Decay of new product ideas Cumulative time, (%) Number of ideas https: //www. slideshare. net/anicalena/strategic-management-business-presentation-slides Original: Booz, Allen, & Hamilton. (1968) Management of new products. New York

Final substance CHALLENGE: REACH registration date >1 t/year Final substance registration • VKG has registered 11 substances which are date >100 t/year produced in quantities over 100 t/y: Final registration date: substances > 1000 t/year Total shale Oil Phenols Calcium oxide substances R 50/R 53>100 t/year Shale Oils, light fraction Rezolyn CMR substances cat. 1 and 2 > 1 Shale Oils, middle fraction t/year Shale oil Bitumen Publication of Shale oils, heavy fraction Shale oil Pitch substances Oil shale, thermal processing waste (ash) Resin SF-281 pre-registered by ECHA, Honeyol Initial registration beginning of registration • Two substances are also registered under REACH but are not produced anymore: Resin Esmol, Epoxy ART 1. 06. 2007 1. 06. -30. 11. 2008 1. 01. 2009 1. 12. 2010 1. 06. 2013 Reach is implemented 1. 06. 2018

CHALLENGE: REACH DEADLINE 31. 05. 2018 VKG needs to register 3 more substances produced in quantities 1 -100 t/year: • 2 -methyresorcinol 5 -methylresorcinol monohydrate pre-registered by 5 -methylresorcinol - -34 pre-registrants, currently • 2 -methyresorcinol registered by some VKG only. Registration in tonnage band 1 -10 t/y: produced and used in EU. If VKG would go to companies: Letter of Access to the registration • 5 -methylresorcinol • physical-chemical testing 30 000 EUR registration at 10 -100 t/y tonnage band alone: data and dossier ~35 000 EUR • physical-chemical testing 30 000 EUR toxicological testing 20 000 EUR • 5 -methylresorcinol monohydrate • • toxicological testing 235 000 EUR ecotoxicological testing 15 000 EUR • ecotoxicological testing 35 000 EUR

CHALLENGE: MARKETING OUTSIDE EU • US Toxic Substances Control Act Anyone who plans to manufacture a new chemical substance to submit a Premanufacture Notice (PMN) at least 90 days before initiating the activity. Honeyol- review period of 1, 5 years-> new chronic ecotoxic test required by EPA, will take 8 months and 100 000 EUR to be completed. • „China REACH“ Companies shall submit new chemical substance notification to the Chemical Registration Centre of the Ministry of Environmental Protection for the new chemicals irrespective of annual tonnage • „Korea REACH“ In force since 01. 2015. All new substances and existing

CHALLENGE: MARKETING • High barriers for entry: • Supplier as a scientific partner in R&D • Need for high flexibility and security of supply • . . . resulting prolonged commercialization phase and possibly miserable market performance for years from the launch

CONCLUSIONS • There is unused potential for the application of Circular Economy concepts in oil shale industry even if focusing on statistics only • The energetic efficiency of Petroter plants ~87% • There could be further economic potential in kerogen to be discovered • Potential for “molecule management” • R&D, scientific contribution necessary in order to: • Improve marketing performance of chemicals • Improve the yield of high-valued chemicals in oil shale processing

Thank you! Q&A