Defining the most cost effective and reliable production and distribution system for nitrogen, oxygen, argon and other industrial gas products requires optimizing a number of supply system characteristics.  

A truly optimal installation not only achieves a low unit cost for gas production, but also provides a high degree of production rate flexibility and high reliability.   

The basic technology choice between cryogenic or non-cryogenic technology, is largely determined by the number of products that must be supplied (e.g. nitrogen or oxygen or both), the required production rates for each gas and/or liquid product, and required product purities. 

The need to accommodate user demand patterns (flow rate fluctuations) leads to additional system optimizations. 

Demand for nitrogen or oxygen will always have some degree of fluctuation.  Instantaneous demand rates are typically met by a combination of potential product sources: 

• Base load demand and a portion of spikes in demand are met by moderate changes in on-site plant gas production rate and previously made gas present in the distribution lines at slightly elevated pressure.

• Additional gas, previously put into elevated pressure gas storage (buffer) vessels may be withdrawn as necessary, A classic buffer tank system maintains "on demand" storage by compressing a portion of the product  to significantly higher pressure than the nominal distribution line pressure, and storing that high pressure gas is in a dedicated pressure vessel.  Elevated pressure buffer tank systems are commonly used to supply end users which have predictable surges in demand on a regular basis - as in steel mills.

• Freshly-vaporized stored liquid nitrogen or oxygen from the plant backup system.  Liquid storage and vaporization systems serve a dual purpose in many installations.  They store liquid - typically enough to site operations for several days  - to maintain continuity of supply if the on-site production plant is not operating - and they also provide supplemental gas when demand rises sharply. 

Cryogenic distillation is necessary for producing significant amounts of oxygen at greater than about 96% purity.  Argon boils at a temperature very close to oxygen. Separating oxygen plus argon from nitrogen is relatively easy, but that results in 95 to 96% purity oxygen.  To make higher purity oxygen requires removing the argon, and the only commercially viable technology for making this separation is distillation.

Cryogenic distillation is also necessary to produce argon. Argon is only 1% of air, so it can only be produced economically as a co-product: usually from of a high purity oxygen plant, but sometimes from an ammonia plant.  

Cryogenic separations are most cost effective at higher production rates.  Cryogenic processes are often preferred above about 50 tons per day.  They are used almost exclusively when gaseous product requirements exceed about 100 tons per day.  

The lowest unit cost for products is typically attained when a "piggyback" plant can be installed to meet the needs of a users having upwards of 50 tons per day of nitrogen or oxygen demand, and the user is located in an area which does not have adequate local production of bulk liquid products. "Piggyback" plants serve one or more onsite gas customers while co-producing bulk liquid products which are then delivered to remote liquid nitrogen and/ or liquid oxygen users.  These plants offer economies of scale and provide excellent production backup to the onsite user due to the large amount of liquid that will be stored on site to support merchant liquid deliveries. 

When merchant liquid production is desirable, several factors often argue in favor of installing liquefiers that have more than the minimum required capacity. On a per-unit-of-production basis, larger plants are more capital efficient and often more energy efficient as well. If power costs in a particular area are lower than those in surrounding areas, supplying customers in outlying areas can sometimes be done more economically with product made in the low-cost area; as the production cost savings can more than offset increased transportation costs. 

LIN-assist plants (also known as LIN-injection plants) are a special type of cryogenic nitrogen plant that uses "imported" refrigeration derived by vaporization of a small amount of purchased LIN to drive the cryogenic separation process.  Because this type of plant has no mechanical refrigeration components, their capital cost is reduced versus a "complete" cryogenic plant.  They are particularly cost effective for applications where users require high-purity nitrogen but have relatively low usage rates (less than about 30 tpd).  They are most likely to have favorable economics when demand is relatively steady and close to the plant's maximum design capacity. 

Non-cryogenic processes are capable of producing relatively high purity nitrogen (up to 99.9%) but capital and operating costs go up with purity, and climb rapidly above 99.5%.  In some cases it can be cost effective to make 99.9% or higher purity nitrogen by first making 99.5% purity nitrogen in a PSA and then using a de-oxo unit to eliminate the residual oxygen. 

Non-cryogenic oxygen purity is generally produced at less than 95%, with 90 - 93% the most common purity target. 

Non-cryogenic separation systems are generally most cost-effective at relatively low production rates.  Individual non-cryogenic units rarely produce much more than 60 tons per day. Some locations use multiple non-cryogenic units to attain higher total production rates (e.g. 120 tons per day).  This can be an attractive production strategy when demand varies widely, but in discrete steps, as in a facility with multiple oxygen-enriched furnaces.

Different process cycles can produce gaseous oxygen or nitrogen at quite different pressures - from just above atmospheric pressure to about 100 psig (9 barg) - without a product compressor. It is worth investigating the  trade-offs among capital cost, process simplicity and operating cost for various configurations. 

Oxygen compression equipment can be expensive.  Plants using cycles that produce product at the required delivery pressure (e.g. an oxygen PSA or pumped LOX cycle vs. a VSA or conventional low product pressure processes) may be a better choice than those that require a product compressor. 

• Conclusions regarding the most cost effective application range for various types of air separation plants apply to comparisons between new plants installed at the same site.

• Conclusions reflect typical capital cost, financing cost and power costs over a ten to fifteen year period.

• The capital cost savings associated with used equipment affect economic comparisons.  Refurbished plants will have wider ranges of applicability than new.

• Local power cost (current and anticipated) has a large influence on optimal plant selection and system design.  The cost of electric power is a very high portion of operating costs.  When products are delivered as liquids it takes more than twice as much power to produce them than if they were supplied as on-site-produced gases.  Operators of plants in low power cost areas will have a greater number of viable plant cycle and configuration choices than those in high power cost areas.

• In general, economies of scale result in capital cost declining as a percentage of total unit cost of production as plant sizes increase. 

• Power consumption per unit of production tends to decrease with size as well, but more slowly. 

• Non-cryogenic plants have capital cost advantages at low production rates.  Cryogenic plants offer the best combination of specific power / unit cost of power and specific capital cost / unit financing cost at higher production rates.

• All other factors being equal, projects expected to have shorter economic lives will favor alternatives with lower capital cost over those with lower operating cost.

Moderate demand fluctuations may be handled with "line packing" and/ or a gas receiver (a.k.a. an accumulator or buffer vessel) that allows accumulation of temporarily excess product at somewhat elevated pressure and its subsequent release when demand increases.  Accumulators can be simple in-line devices, but are more often coupled with a throttling (and venting) or on/off control scheme that keeps the receiver vessel and the distribution pipeline pressures within predetermined ranges. The more severe the expected demand swings, the more useable storage capacity must be provided in the accumulator.  Higher storage capacity is achieved by using a larger vessel or increasing the peak storage pressure (or both).

Demand fluctuations that cannot be handled with production rate load following and accumulator action are usually accommodated by adding vaporized liquid product to the distribution system when demand increases quickly or significantly and by  venting temporarily excess production when demand drops rapidly or severely.

Some plants have usage patterns that exhibit a relatively constant base load with severe intermittent demand peaks. The most cost effective approach with this type of load is to use vaporized liquid (usually from an outside source) to meet the peaks while the base load is supplied by an onsite production plant. This allows the local production facility to operate at an efficient, trouble-free, close-to-constant rate while minimizing the use of relatively expensive liquid.

Customers in remote locations may need to install redundant production components (e.g. dual air compressors) and more liquid storage (larger storage tanks and/ or multiple storage tanks).  These customers will often prefer an onsite plant that is capable of producing 2 to 10% of its separation capacity as liquid to allow maintenance and rebuilding of backup storage levels with local liquid production.

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