Air Products’ strategic focus and market demands leads to R100m upgrade

Air Products was well-poised to respond when the market demanded an increase in the supply of carbon dioxide (CO2)
and they took action by investing R100million in a significant CO2 expansion and refurbishment project at the Newcastle Facility in
KwaZulu-Natal and an upgrade at the National Petroleum Refiners of South Africa (Natref) Facility in Sasolburg. The growing food and
beverage industry, which is the largest consumer of CO2, has been identified as a target market in line with the long-term strategic vision
for the CO2 business at Air Products. P Air Products’ gaseous CO2 facility in Newcastle has the capacity to produce and recover large quantities of carbon dioxide from blast
furnace off-gas; however, the facility’s capacity to liquefy gas was extremely limited. Following Air Products’ bulk business being awarded
a large tender to supply one of South Africa’s largest beverage manufacturers, there was a need to invest in a new liquefier to complement
the existing liquefaction plant and utilise the excess gaseous CO2 production capacity available at the Newcastle Facility.

Charles Dos Santos, General Manager – On-Sites explains what the project entailed: “The scope of the CO2 expansion and refurbishment project
which started early in 2017 was quite extensive. The project was executed in three parallel streams, which required the installation of a new
liquefier, the addition of two liquid storages on the facility as well as the refurbishment of the existing gaseous CO2 production facility.”

“The refurbishment part of the project was extremely challenging as the work had to be done on a facility that was operational, thereby
only allowing the refurbishment team limited opportunities to undertake the necessary refurbishment, upgrades and tie-ins as the operations allowed.
As the existing plant was completed in 1998, and its full capacity had not been used since 2013, the condition of the equipment and scope of
work could not be assessed until the equipment could be dismantled and inspected internally”, Dos Santos explained. Dos Santos further mentions
that the project also included improvements with regards to water utilisation and energy efficiency. Even though there was an extremely tight deadline,
the project was completed on time and exceeded its design performance.


Air Products Bulk Tanker and new CO2 storage tanks

The project was approved in March 2017 and the plant was brought on-stream in phases.
– The new liquefier and refurbished gas production plant was brought on stream in November 2017
– The first of the two storage tanks was brought into operation in December 2017
– The second storage tank was brought into operation in April 2018

Dos Santos highlights that Air Products is fortunate to have highly skilled employees with various skills sets required to execute a project of
this complexity. “The key role players in the project consisted of a multi-disciplinary On-Sites projects team based at the Vanderbijlpark and
Newcastle Facilities. As with most projects of this nature, you do encounter challenges, but I am pleased to say that the team adapted and managed
the challenges exceptionally well. We are extremely focused on maintaining high safety standards, and this remained a key priority. Besides the
On-Sites teams, the Supply Chain and Quality teams were also instrumental in the process.”

Quality is an important aspect of Air Products’ operations and depending on the application there are varying specifications required by our customers.
CO2 is produced for Air Products from two different sources – the Newcastle Facility and the Natref refinery in Sasolburg. CO2 is produced at
these sources according to the International Society of Beverage Technologists (ISBT) specifications as a minimum quality specification and
is used for food and beverage applications. The CO2 used for the food and beverage customer applications is required to be tested and supplied with a
certificate of analysis (COA). The COA is issued to the customer upon delivery of the product.

Abdul Shaik, Operational Risk Manager, explains: “Prior to the upgrade project, the CO2 produced at the Natref Facility had to be transported by tanker
to the Air Products Vanderbijlpark Facility where it was tested and a COA was issued by the Vanderbijlpark Quality Control (QC) Laboratory. This caused
inefficiencies in our road tanker fleet and unnecessary time delays, ultimately impacting on the overall service delivery to the customer. With the upgrade,
a laboratory and analyser was installed at the Natref Facility enabling on-site testing at the facility. The laboratories located at both the Natref and
Newcastle Facilities ensure that the quality is verified at source and as a result this leads to an improvement in customer service.”

The overall investment in the project has enabled Air Products to cost-effectively and optimally utilise its assets to expand rapidly to meet the market’s
increased CO2 requirements. The upgrade project resulted in a substantial increase in the liquid CO2 production capacity as well as the diversity of
supply to customers.

The upgrade project had a huge impact on Air Products’ supply chain business – it is fully geared to confidently offer a secure supply of CO2 to
support the market growth and growing its footprint in the food and beverage market. According to Seelan Gounden, General Manager – Supply Chain,
supplying larger volumes of CO2 is perceived as challenging to most companies. “Air Products has been extremely cautious and we did all the
necessary forecasts and projections to ensure that our decision is responsible and will benefit the organisation in the long term.”

Dos Santos and Gounden are in agreement that the completion of this project is a noteworthy achievement for Air Products in many ways. Utilising
existing assets and improved efficiencies both address the continuous strive towards improvement and innovation. Gounden concludes: “Air Products’
entire value chain has been impacted by this upgrade and we are pleased with the increased diversity of production sites and storage capacity. We are
also ensuring that we optimise our modern fleet by doing less trips and reducing our carbon footprint. We are looking forward to provide a secure
supply of CO2 to our existing customers as well as to grow the CO2 market.”

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