Octane Report

OCTANE ENHANCING PETROL ADDITIVES/PRODUCTS
LITERATURE REVIEW AND ANALYSIS
September 2000
DUNCAN SEDDON & ASSOCIATES PTY LTD. 116 KOORNALLA CRESCENT MOUNT ELIZA VICTORIA 3930 TEL 03 9787 4793
FAX 03 9770 1699
E-mail: seddon@ozemail.com.au
Duncan Seddon & Associates has been retained by Environment Australia to provide a literature survey and analysis of octane enhancers that may be used in Australia and help the nation to implement better fuel quality standards. The report has been prepared for the sole benefit of Environment Australia. Any third party in the possession of the report may not rely upon its conclusions without the written consent of Duncan Seddon & Associates. Duncan Seddon & Associates conducted this analysis and prepared this report utilising reasonable care and skill in applying methods of analysis consistent with normal industry practice. All results are based on information available at the time of the study. Changes in factors upon which the study is based could affect the results. There is no implied warranty or merchantability or fitness for a particular purpose shall apply.
Acknowledgment Duncan Seddon & Associates expresses its sincere thanks to contributions from Dr. John Harris of RMIT for his assistance and analysis of the blending of oxygenate additives and gasoline. I would also like to thank Professor Jorma Ahokas and Peter Jackson of RMIT for useful commentary on the toxicity of additives and for providing a reference to NOHSC data.
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EXECUTIVE SUMMARY Overview The move to harmonise Australian fuel standards with those of Europe will have a profound effect on the manufacture and supply of petrol. Amongst other factors, harmonisation requires an increase in motor octane. This is the subject of this Review. As well as increasing octane, harmonisation will require limits to be placed on the levels of aromatics and olefines in the petrol. These components have a naturally high octane and the new limits will make the manufacture of highoctane petrol more difficult. Whilst this can be achieved, it will only be done so at an increased cost to the motorist and an increased cost to the environment. In order to ameliorate these costs, octane-enhancing additives may prove useful to Australian refiners and importers. The availability, cost and environmental impact of these additives are reviewed. We are concerned with the production of petrol, which has no other use than as a fuel for transport. Petrol comprises a mixture of many thousands of different hydrocarbon compounds plus additives that may contain other elements. Very few are non-toxic or unhazardous in some way or other. Although used in large quantities by the motorist, the general public rarely comes into contact with petrol. It is always confined to sealed vessels, and modern-filling techniques minimises fugitive emissions and splashes. Like the components of petrol, each of the octane-enhancing additives present environmental and health issues. All of the problems are solvable within the boundaries of fuel production, storage, transport and distribution. Fuel harmonisation is occurring across the world. Whilst the primary aim is to facilitate the introduction of better emission standards for vehicles, there will be another effect, namely an increase in trade of fuels as opposed to basestocks and refinery intermediates. Because fuels will be produced to similar standards across a range of countries (eg South Asia), there will be an opportunity for refiners to benefit from economies of scale and supply several markets with petrol. This will serve to benefit the motorist by holding down price rises that would otherwise occur as a result of the increased costs of production of the better quality fuel.
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Although there will be opportunities for the larger and more modern Australian refineries, the increased cost of producing the higher quality fuels may create difficulties for the smaller and older refineries. Market share currently supplied by the latter refineries may be lost to interstate refineries and imports. Because of the large volume use of petrol, and to minimise shipping costs, it is shipped in relatively large vessels. To permit effective trade and prevent shortages, we have to guard against using Australian fuel standards as a means of unfairly discriminating against imported product. The danger is the tendency to ban specific petrol components as a reaction to adverse media coverage or to pacify local political pressure. Obviously local bans of specific components is contrary to fuel harmonisation. A specific case in point is the ether additive MTBE. This is the most widely used octane-enhancing additive, but is currently under suspicion in the US as a contaminant of water supplies. Because of the contamination of vessels, banning MTBE (and similar ethers) could effectively present a barrier to importing lower cost petrol. Further, banning ethers (or any other additive) would require extensive testing of product. Because of the scale of import, refusal of entry of a contaminated vessel, would result in disruptions to the local petrol supply chain, inevitably increased prices for the motorist, and potentially shortages and rationing. Taking all of these points into consideration, and aiming to achieve the optimum outcome for the motorist, refiner, importer and the environment, the direction of the recommendations is to facilitate maximum flexibility in the supply of petrol to the proposed new, higher-octane petrol standards. Review Findings It is technically feasible for Australia to adopt Euro-3 petrol standards without resorting to octane enhancers. However, this will constrain the industry to producing petrol high in aromatics. Mass production of high octane 98 RON and Euro-4 fuel will probably require octane enhancers. Suitable octane enhancers are alcohols, ethers and organometallics such as the additive MMT.
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Of the alcohols, methanol is to be avoided. Ethanol is the alcohol of principal interest. It is used in petrol in Australia and elsewhere. Ethanol can be produced from biomass, but to remain competitive would require a subsidy ethanol is currently free of excise. However, there are serious issues with the use of ethanol, which remain to be addressed. These include air toxicity and water contamination. It is highly likely that it will be difficult, if not impossible, for ethanol - petrol blends to meet Euro-3 specifications from the standpoint of summer RVP (60 kPa limit). Waiving this limit for ethanol would undermine the reasoning for a low RVP value in Euro-3 and Euro-4. The use of higher alcohols (propanols, butanols) will be constrained by supply but may be able to make an occasional contribution in selected instances. Of the ethers, MTBE is the preferred oxygenate of world oil industry. It is widely used in Europe, the USA and the Far East. It is not currently used in Australia. The controversy surrounding the use of MTBE is a consequence of the failure to properly control petrol transport and storage. All oxygenates (including ethanol) are likely to suffer a similar level of concern if they were widely used. The MTBE controversy may lead to the phase out of MTBE in the USA. This is likely to severely disrupt world markets for oxygenates and petrol feedstocks. It will cause a major worldwide reappraisal of the approach to octane. It is doubtful if Europe could adopt the new standards (Euro-3 and Euro-4) without the use of MTBE. Other ethers (TAME, ETBE, DIPE) are likely to be useful in occasional circumstances. Their use is likely to be constrained by supply. Their use is likely to be marred by the MTBE controversy. The use of the manganese additive MMT is highly controversial but has growing acceptance in the refining industry. MMT may be useful in producing lead replacement petrol and to achieve the lower Euro-4 aromatics level. Optimum results may be obtained by using a mixture of additives so as to ameliorate the deficiencies of each of the additives.
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RECOMMENDATIONS 1. MTBE is the preferred octane enhancer of the world oil industry and would be suitable for use in Australia. In order to ameliorate concerns with groundwater contamination, a national audit on the status of gasoline transport (pipelines) and storage should be conducted with the object of identifying issues that would lead to pollution of water supplies by any gasoline component. 2. Prima facie the use of ethanol is incompatible with proposed standards with respect to oxygen content and RVP at the commonly used 10% level. Waivers specifically for ethanol in these areas are not in line with the aim of the standards. Nevertheless, we recognise the social desire to see ethanol included in the Australian gasoline pool. The use of ethanol in future Australian gasoline pool should be subject to further analysis, particularly defining how the required RVP from ethanol blends can be met using Australian basestocks. 3. In order to maximise the flexibility for refiners or importers to provide high octane gasoline, it is possible that ETBE and TAME could be used, once these chemicals have been notified by potential manufacturers and importers to NICNAS and assessment certificates have been issued. ETBE and TAME are not currently listed on AICS. 4. The widespread introduction of 98 octane fuel would require a substantial review of octane production in Australia, implying a major overhaul of refinery operations. It is not clear if 98 octane will result in a net global emissions improvement. Until this is clarified by additional work, the widespread introduction of 98 octane gasoline should not be encouraged by automakers and regulatory agencies. 5. There should be no in-principle objections to the use of either MMT or ferrocene. MMT is the best researched and most widely used and would offer the refiners a method of ensuring the final gasoline is of the required octane (trimming). There is increasing interest in ferrocene, however, the depth of analysis is much less that that for MMT. Further there are several alternative suppliers of ferrocene and quality standards of the additive may be a concern.
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6. To facilitate flexibility, the following oxygenates should be permitted in Australian petrol. These oxygenates could be used alone or in combination with other oxygenates or permitted organometallic compounds (MMT, ferrocene). The maximum level should be set by the Euro-3 maximum oxygen content of 2.7%: Oxygenate Ethanol TBA MTBE DIPE ETBE TAME ETAE Isopropanol n-propanol Isobutanol n-Butanol sec-Butanol Chem. Abstract No. 64-17-5 75-65-0 1634-04-4 108-20-3 637-92-3 994-05-8 919-94-8 67-63-0 71-23-8 78-83-1 71-36-3 78-92-2
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CONTENTS
APPROACH ...............................................................................................................1
Objectives ..............................................................................................................................................................1 Nomenclature ........................................................................................................................................................2
IDENTIFICATION OF CHEMICAL ADDITIVES .........................................................5

History....................................................................................................................................................................5 MTBE and Water Contamination .......................................................................................................................6 Other Oxygenates and Other Additives ..............................................................................................................7 Octane Boosters to be Studied .............................................................................................................................8 Non Oxygenate Octane Boosters .......................................................................................................................11 High Octane Hydrocarbons ...............................................................................................................................12
EFFECTS ON PETROL CHARACTERISTICS, ENGINE EFFICIENCY, COMPATIBILITY, AND EMISSIONS PROFILE.......................................................15

Background to Octane Boosters ........................................................................................................................15 Fuel Blending Overview .....................................................................................................................................18 Blending Studies..................................................................................................................................................19 Climate .................................................................................................................................................................21 Alcohol and Ethers Emissions profiles ..............................................................................................................22 Greenhouse ..........................................................................................................................................................23 Ferrocene .............................................................................................................................................................25 MMT ....................................................................................................................................................................25 Automotive Finishes and Parts ..........................................................................................................................27 Automotive Industry Views................................................................................................................................29
FINANCIAL COSTS OF THE ADDITIVES ...............................................................31

Background .........................................................................................................................................................31 Methanol ..............................................................................................................................................................32 Ethanol.................................................................................................................................................................33 MTBE...................................................................................................................................................................34 Other Oxygenates................................................................................................................................................35 Implication of Californian and US Ban on MTBE...........................................................................................35 Trade in Gasoline Components (BTX, Alkylate)..............................................................................................37
ENVIRONMENTAL AND HEALTH EFFECTS OF ADDITIVES ...............................39

Background .........................................................................................................................................................39 NICNAS and AICS .............................................................................................................................................40
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Methanol (CAS 67-56-1).....................................................................................................................................40 Ethanol (CAS 64-17-5)........................................................................................................................................42 TBA (CAS 75-65-0) .............................................................................................................................................43 Other Alcohols.....................................................................................................................................................44 MTBE (CAS 1634-04-4) .....................................................................................................................................48 Proposed US MTBE Phase-Out - Blue Ribbon Panel......................................................................................49 TAME and Other Ethers....................................................................................................................................51 Comparison to BTEX and Alkylate...................................................................................................................52 Comparative Data ...............................................................................................................................................52 Ferrocene (CAS 102-54-5) ..................................................................................................................................54 MMT (CAS 12108-13-3).....................................................................................................................................54 Gasoline Components .........................................................................................................................................56
IMPEDIMENTS OF HARMONIZATION WITH EUROPEAN UNION QUALITY STANDARDS ...........................................................................................................59

Overview ..............................................................................................................................................................59 Environmental Impact of Increased Aromatics in Gasoline Pool ...................................................................62 Issues ....................................................................................................................................................................62
STAKEHOLDER INPUTS ........................................................................................67

Motoring Organisations .....................................................................................................................................67 Australian Institute of Petroleum ......................................................................................................................67 Federal Chamber of Automotive Industries .....................................................................................................69
RECOMMENDATIONS ............................................................................................71 REFERENCES .........................................................................................................73 EXHIBITS .................................................................................................................75
APPROACH
Objectives This report is concerned with identifying and describing octane boosting chemicals that might be used in Australia for the production of high octane petrol. The petrol specifications are delineated in the Fuel Quality Report [COFFEY] and are aimed at harmonising Australian fuel quality and standards with European Union standards for petrol, the so-called Euro-3 and Euro-4 fuels. The report conducted by RMIT University [RMIT] of November 1994 detailed the use of octane enhancers to that time. Although this early report was primarily concerned with the elimination of lead additives in petrol, the descriptions and use of alternative octane boosters to lead alkyls is still largely valid. The Study Objectives were: 1. Identify chemical additives/products that may be added to lead replacement petrol and/or unleaded petrol to increase its octane number. 2. Identify the potential: Effects on petrol characteristics, eg RON, MON, volatility etc; Effects on engine efficiency (in terms of fuel consumption) and performance; Effects on compatibility with current and future motor vehicle emission reduction technologies; Effects on other vehicle and engine components, eg spark plugs, fuel systems, exterior paint and ornamentation; and Changes to the vehicle tailpipe and evaporative emissions profile Which may arise from the use of these additives/products in Australian petrol. 3. Compare the financial cost of each of the additives/products to reach the desired octane number. 4. Provide details on, and advise on the significance of, environmental and health effects of the chemical additives/products. 5. Identify impediments to Australias objective to harmonise with European Union petrol quality standards due to the use of these additives/products 6. Provide recommendations on octane enhancement additives/products that could be suitable for use in petrol in Australia, for both unleaded petrol and lead replacement petrol. This should include consideration of the various climatic conditions experienced in Australia.
Page 1 Duncan Seddon & Associates Pty Ltd.
Literature and Information Available Since the earlier RMIT study, there has been a revolution in the availability of information, primarily as a consequence of the explosive growth in the Internet. Three sources of basic information have been used in this Study: Reports from government agencies and industry bodies published on the Internet. Obviously some of this data may in the light of subsequent analysis be proved misleading. Nevertheless, the data pertinent to this Study is substantial, principally from organisations operating in the USA. These reports are presented in EXHIBITS as an annexe to the Study. Articles and reports in academic journals and learned society publications. These are subject to peer review and can be considered to give data to a high level of accuracy with assumptions, etc, delineated in the article. Because of the nature of publication, even with modern electronic publishing methods, there is a considerable time lag between an observation and a publication, often as much as two years. This data was accessed using the Chemical Abstracts database via RMIT University. These data sources are referenced in [SQUARE BRACKETS] and listed at the end of this report. Patents and industrial know-how which may become available to those in the trade. Patents have a similar time lag to academic papers and are not critically reviewed. Pertinent know-how on major issues was also obtained from the major stakeholders. This data is referenced with the data source as necessary.
Nomenclature Gasoline and Petrol In the industry gasoline is the universal term for the liquid fuel used in spark ignition engines. Petrol is a trademark, however, the term petrol is used almost exclusively in Australia and other former British colonies. In this report, generally we adopt the industry term gasoline. Chemicals The several chemical compounds studied are usually known by older (non IUPAC) names. For most compounds there are a variety of synonyms, abbreviations and acronyms1. Since IUPAC nomenclature can be cumbersome and rather esoteric, the most commonly used name abbreviation or acronym is used. To avoid confusion, the Chemical Abstract reference number (CAS) is used to identify the specific chemicals. As well as Chemical Abstracts, many databases and Internet sites can be searched on CAS number. This helps avoid confusion as a consequence of poor nomenclature. The aromatic chemicals benzene, toluene and xylenes are often referred to as BTX. In this usage, the xylenes component is the C8 aromatics fraction made by reforming. The fraction is
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The United States Environment Protection Authority gives a good list of alternative names for alcohol and ether octane boosters at http://www.epa.gov.swerust/oxygenat/oxytable.htm
often referred to as virgin xylenes or mixed xylenes. This fraction also contains significant volumes of ethylbenzene as well as the three isomers of xylene (dimethylbenzene) in a ratio which reflects the relative thermodynamic stability (ie about 50% meta-xylene and about 25% ortho- and para-xylene). In some instances this group of aromatics (benzene, toluene, ethylbenzene and xylenes) is referred to as BTEX. Gasoline Extender In the USA and Brazil, ethanol is used in relatively large volumes in the gasoline, namely more than 10% of the final product. In some parts this use is described as a gasoline extender, because the locally produced ethanol displaces what would be otherwise imported gasoline or crude oil. This term is also used in Australian ethanol blending operations. In other words the term gasoline extender is used to describe the use of an additive which displaces refinery produced gasoline from the market and is done irrespective of considerations of the octane requirements and air quality requirements.
IDENTIFICATION OF CHEMICAL ADDITIVES

PRODUCTS THAT MAY BE ADDED TO LEAD REPLACEMENT AND/OR UNLEADED PETROL TO INCREASE OCTANE NUMBER History This Study concerns the identification of additives, which may be used as octane boosters to gasoline. Since the mass production of the automobile in the early 1920s, octane boosters have been part of the fuel supply chain. The efficacy of lead additives was identified early in the industry and lead based additives became the universal octane booster. The first drive for the elimination of lead based octane boosters came during the 1970s. It was realised that air pollution in many of the cities of the USA was a consequence of vehicle emissions. The prime technology for ameliorating these emissions was catalytic converters and lead is inimical to catalysts. In order to use catalytic converters, but maintain the level of octane in the gasoline (important for maintaining efficiency - miles per gallon), new octane boosters were required. Consequently, there was a large research effort into octane boosters, which could be compatible with catalytic converters. Concomitant with this was the realisation of the problem with lead in the urban environment, particularly in large cities where the distribution of lead correlated with traffic densities. There was then a movement, which became worldwide, for the elimination of lead in gasoline on health grounds. Again this forced a search, particularly by European based organisations, for additives which could assist lead replacement by boosting octane. The 1970s period saw the identification of alcohols, ethers and the manganese additive MMT and the iron additive ferrocene as possible alternatives to lead. The era also saw the identification of MTBE as being the most widely acceptable alternative. From this time MTBE started to be used as a gasoline additive in many parts of the world at typically 1 ~ 2% level. In the early 1980s, it became evident that catalytic converters were not controlling the level of air pollution in certain cities in the USA. These cities suffered from photochemical smog, the main contributors to this was carbon monoxide, unburnt hydrocarbons, nitrogen oxides and fugitive emissions of certain gasoline components, referred to as volatile organic compound (VOCs). The city with most problems was the Los Angeles area of California and California became a pioneering state in terms of analysis, promotion and legislation of alternative (clean burning fuels such as methanol) and reformulated gasoline. The US Clean Air Act Amendments (CAAA 1990) attempted to solve the air pollution problem by mandating formulae for the component mix of gasoline, so called reformulated gasoline (RFG). Of particular interest was the mandated introduction of certain levels of
oxygen in the gasoline. This could be supplied by the octane booster MTBE at about the 10 ~ 15% level. This caused an enormous increase in demand for MTBE and plants were built in many parts of the world (eg Middle East) to supply the US and particularly the Californian demand. California is the worlds largest single market for gasoline and the demand for MTBE caused a massive expansion in plants producing MTBE to supply this market. Because of costs and possible shortages of MTBE oxygenate, opportunities for other alternatives were considered. Ethanol has a long history for use as both a gasoline extender, octane booster and as an alternative fuel. The momentum for using ethanol was helped by its ease of production from a wide variety of agricultural sources, hence can be considered a sustainable fuel. The worlds largest use of ethanol is in Brazil, where ethanol is used as an indigenous fuel supply following the oil shocks of the early 1970s. There has been extensive research on the use of ethanol as a fuel in the USA and Europe. The largest promotion for ethanol use is by the socalled corn states of the USA (centred on Nebraska). Their powerful industry lobby has successfully secured tax-breaks for the use of ethanol produced from corn, allowing it to compete with MTBE in the US market. Ethanol is widely used as an additive in the corn-belt states. To help promote the use of ethanol in gasoline, the ether derivative ETBE can be produced in MTBE plants. One of the problems with production of MTBE is the supply of the C4 olefine isobutene feedstock. In order to supplement supplies, C5 olefines (pentenes, old name amylenes) can be used, this produces TAME. Where refinery operations have an excess of propylene, the ether DIPE can be produced in place of MTBE. Parallel to the use of alcohols and ethers was the progressive development of MMT as a replacement for lead and its use in a small number but widespread locations. The additive ferrocene has received spasmodic interest. MTBE and Water Contamination After about five years of use in reformulated gasoline in the USA, MTBE was detected in ground water in several states (eg California and Maine). The primary source of contamination was from leaks or illegal drainage from underground gasoline storage tanks. A second source was from leaking pipeline systems, which supply the very large Californian market with gasoline. A third source was from older recreational watercraft operating on lakes and waterways. In California there are a large number of private wells and other schemes, which use the ground water as potable water. The MTBE contaminant tainted the water (it can be detected by taste at the parts per billion levels).
In May 1997 the California Legislature considered discontinuing the use of MTBE in the State. This has generated a substantial level of activity on how best this might be achieved and what are the alternatives to MTBE as both the provider of oxygen and as an octane booster. Much of the reported work is available on the Internet [EXHIBIT 26]. Momentum continued to build up national for action and the US Environment protection Authority (EPA) set up the Blue Ribbon Panel to consider the issue of MTBE contamination of water supply on a national basis. This activity is continuing with the US Executive promoting bills in Congress that would lead to MTBE being phased out. Other Oxygenates and Other Additives The emphasis of this Study is on materials which might be added to gasoline in order to boost octane. It should be realised that there is a large range of materials added to gasoline before use in a vehicle. These additives are added to the basestock within the refinery, at the rack by the fuel-distributor or on the forecourt by the motorist. These additives contain detergents and other compounds containing elements in addition to carbon and hydrogen. Such additive packages claim to improve gasoline and offer product differentiation in the market from the same refinery source. The role, impact and environmental fate of such additives are beyond the scope of this Study. As well as boosting octane, alcohols and ethers also add oxygen to the gasoline. There may be a need to add materials, which add oxygen but not necessarily improve octane. There may be a group of materials, which have not been studied in this report, which may be effective for this duty and not harm the final product. There are several possible additives. For example, one of these products, marketed as Fuel Effect, contains fatty acid esters. This product is primarily marketed as a combustion improvement aid, particularly for diesel engines. In addition, when used in spark ignition engines, Fuel Effect is claimed to lower the carbon monoxide emission - one of the principal reasons for incorporating oxygen in fuel [data provided by GRAF ENTERPRISES PTY LTD - EXHIBIT 14]. As witnessed by a visit to a typical auto-shop there are many additives that can be added to fuel which are claimed to improve engine performance. It would seem churlish to proscribe their use in gasoline provided that the gasoline met the appropriate standard and no adverse effects to the longevity of the engine and ancillary parts resulted. Because these materials, in general, do not cause a significant lift in octane they are not studied further.
Octane Boosters to be Studied The octane boosters and a brief history of their use as fuels are: ALCOHOLS Methanol: CAS 67-56-1 Methanol is a major commodity chemical with some 25 million tonnes produced annually (Mt/a). Its main use (ca. 50%) is in the production of formaldehyde, which is used with urea for the production of adhesive, which is used to make particleboard. The remaining 50% is spread across a wide variety of industries of which the production of MTBE is prominent. The main driver for the use of methanol is that it is made from natural gas and is easily transported as a liquid. It can potentially be made in very large volumes and delivered at broadly similar costs to conventional fuels. Methanol can be used as a fuel in its own right. Its very high octane makes it attractive for specialist auto sports enthusiasts (drag racing). It has occasionally been used with ethanol in Brazil when that country has failed to produce sufficient agricultural ethanol for its own needs. Methanol is a clean burning fuel and there have been extensive trials in California and elsewhere on the use of methanol fuels. These uses are not subject to this Review. Methanol can also be used as an octane booster in commercial gasoline. However, it is not very fungible (stable) because traces of water cause it to separate. However, this problem can be ameliorated by the addition of higher alcohols such as TBA. Again there have been extensive trials, particularly in California. Methanol addition is permitted under the US EPA rules for the production of reformulated gasoline2. In Australia3, methanol is produced in a small research plant at Laverton in Victoria; there are several proposals for major facilities to be established in WA and NT. Ethanol: CAS 64-17-5 The use of ethanol as a fuel for spark-ignition engines dates from the advent of the motor vehicle industry. The more widely available and cheaper petroleum products displaced ethanol. Interest in ethanol fuels was rekindled after the 1970s oil price shocks and the growing interest in renewable fuels. World production capacity is 24 Mt/a (560,000 bbl/d) with a further 0.8 Mt/a (17,700 bbl/d) planned. Most fuel grade ethanol is produced in Brazil (45%) and the USA (20%) with these
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Federal Register Vol. 62. No. 133, 37388, July 1997 re proposed Rules for Gasoline. The National Energy Research Development and Demonstration Program (NERDDP) supported work on the production and use of fuel methanol in Australia. Seven technical reports and consultancy reports are listed as available in the March 1990.
countries dominating world usage. There is also some production in France and Canada, India and China and small amounts in Australia. Brazil requires that all gasoline sold contains 24% ethanol and approximately 4 million cars are designed to operate on 100% hydrous ethanol (95% ethanol, 5% water). This creates a demand of 220,000 bbl/d. The US consumption of ethanol is dominated by the corn producing states of the mid-west where it is used as a component of Federal reformulated gasoline and as a gasoline extender4. The current demand is about 80,000 bbl/d In Australia there have been extensive trials of ethanol in gasoline5. There are several producing facilities for ethanol. TBA (Tertiary Butyl Alcohol; 2-Methyl-2-Propanol): CAS 75-65-0 Work during the 1970s indicated the superior properties of TBA to other alcohols from the standpoint of gasoline compatibility. TBA is produced within the petrochemical industry as an intermediate and for specific uses. The production is small, mainly in the US Gulf Coast and Europe. Total annual production is about 2.6 Mt/a (60,000 bbl/d). TBA can be produced in the same plant as MTBE and can often be a contaminant of commercial MTBE. The small amount of TBA in the MTBE has little effect on the latter additive's efficacy. IPA (Iso Propyl Alcohol, 2-Propanol) CAS 67-63-0 This is listed as an acceptable additive for Euro-3 and Euro-4 fuels6. Over 2 million tonnes of IPA are produced annually, mainly in USA, Europe and Japan. It is used as a solvent and to produce other chemicals. At present a major portion of IPA is produced from acetone (which in turn is produced as a byproduct from the manufacture of phenol). A small amount of acetone (hence potentially IPA) is produced in Melbourne. Refineries can produce considerable quantities of propylene and this can be the immediate precursor to the production of IPA. This would be an attractive route to refiners with no alternative use for propylene.
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Marketed as gasohol, 10% ethanol in gasoline. The National Energy Research Development and Demonstration Program (NERDDP) supported a considerable amount of work on the production and use of fuel ethanol in Australia. 35 technical reports, workshop reports and consultancy reports are listed as available in the March 1990. 6 Environment Australia Setting National Fuel Quality Standards - Paper 2, Proposed Standards for Fuel Parameters (Petrol and Diesel) April 2000, p. 56 (Table 6.4)
Other Alcohols: The following alcohols are used within the petrochemical industry. The main interest in these materials is that they can be produced from synthesis-gas (carbon monoxide and hydrogen). This in turn can be produced from any carbon source such as natural gas or even municipal and agricultural waste. The process is a variant on the Fischer-Tropsch process for the production of synthetic fuels. It was practiced during the early 1950s to produce iso-butanol7. During the 1980s, especially in Europe, there was considerable research into improving the process and a modern plant would probably produce a range of lower alcohols centred on butanol. Some of these alcohols can be produced by fermentation processes and can be classified as sustainable fuels. Nowadays these materials are produced by a variety of different petrochemical processes. n-Propanol (1-Propanol): CAS 71-23-8 This is listed as an acceptable oxygenate for reformulated gasoline in the USA8. The alcohol is produced by OXO process from ethylene or by direct oxidation of propane. It can be produced as a byproduct of fermentation processes. n-Butanol (normal butyl alcohol, 1-Butanol): CAS 71-36-3 Produced by the OXO process from propylene and several other routes. sec-Butanol (secondary butyl alcohol, 2-Butanol): CAS 78-92-2 Produced by hydration of butenes (byproducts in production of ethylene). This alcohol is produced in large quantities for the production of the solvent MEK (methyl ethyl ketone). iso-Butanol (isobutyl alcohol, 2-Methyl-1-Propanol) CAS 78-83-1 This is listed as an acceptable additive for Euro-3 and Euro-4 fuels. Nowadays made by the Reppe process from propylene but would be the principal product of modern Isosynthesis plants. ETHERS MTBE (Methyl-Tertiary-Butyl Ether): CAS 1634-04-4 MTBE is the principal oxygenate and octane boosting additive with worldwide use. Manufactured by the addition of methanol to the olefin isobutene (2-methylpropene). The latter is produced as a byproduct to refinery and petrochemical operations and can be made from the butane component of LPG.
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Known as Isosynthesis. Federal Register Vol. 62. No. 133, 37388, July 1997 re proposed Rules for Gasoline.
World production capacity of MTBE is 21 Mt/a (522,141 bbl/d) with a further 7 Mt/a of capacity in construction or planning. MTBE has no other significant use other than as a fuel additive. TAME (Tertiary-Amyl-Methyl-Ether): CAS 994-05-8 TAME is used extensively as a supplement to MTBE in the USA for reformulated gasoline and as an octane booster in Europe. World production capacity is 2 Mt/a (46,819 bbl/d) of which 50% is in the USA, with a further 0.7 Mt/a (6,364 bbl/d) planned. ETBE (Ethyl-Tertiary-Butyl-Ether): CAS 637-92-3 ETBE is widely used as an additive in the USA and Europe (France, Russia). The principal driver is to produce an ethanol derived additive that is better suited to gasoline blending than ethanol. World production capacity is 3.7 Mt/a (91,000 bbl/d) with an additional 0.8 Mt/a (20,800 bbl/d) under construction. Most capacity is in the USA and (except European plants) are flexible operations, which can switch between MTBE and ETBE. DIPE (Di-Iso-Propyl-Ether): CAS 108-20-3 DIPE is a permitted additive under US Federal reformulated gasoline regulations and the proposed Euro-3 and Euro-4 rules. It is made from propylene and water. Isopropanol is a byproduct. The world capacity is unknown but probably small. DIPE production and blending properties have been described [McNally]. ETAE (Ethyl-Tertiary-Amyl Ether): CAS 919-94-8 This is the ethanol variant of TAME, permitted under US Federal reformulated gasoline rules. There is a paucity of data on this additive. Non Oxygenate Octane Boosters Organometallic compounds boost octane but contribute negligible oxygen content (if any) to the finished gasoline. Until now, lead alkyls have been dominant. Many other organometallic compounds have been tried, but only two have emerged with potential. An iron based additive, ferrocene, and a manganese additive, MMT. Ferrocene (dicyclopentadienyl iron): CAS 102-54-5 Ferrocene is a dark orange coloured powder, freely soluble in hydrocarbons. It is available from Associated Octel as the additive PLUTOcen(R). To date, ferrocene additive has
struggled to gain industry acceptance. The basic problem appears to be the erosive nature of the combustion products. Several companies in China also sell the product.9. MMT (Methylcyclopentadienyl Manganese Tricarbonyl): CAS 12108-13-3 MMT is a liquid octane enhancer for unleaded and lead replacement petrol. It is a pure compound of low vapour pressure (0.05 mmHg @ 20C), high flash point (96C) and thermally stable to its boiling point (232C). MMT has extremely low solubility in water, but is freely soluble in gasoline. MMT is the principal metal-based octane booster considered in this Study. This has been extensively research from the 1950s and is in widespread use in several countries. All of the oil majors have had some experience in using MMT overseas. High Octane Hydrocarbons There are several components of gasoline of high octane which a widely traded. These could be used as octane boosters and blendstocks and are considered in this Study where appropriate for comparative purposes. These materials are: Butane: CAS 106-97-8: This is one of the two principal components of LPG, also produced in refineries as byproduct in various unit operations. Many millions of tonnes are traded annually. Benzene: CAS 71-43-2: This is a major commodity chemical (world annual trade about 15 Mt/a). Benzene is the basic building block for the manufacture of styrene and nylon. Toluene: CAS 108-88-3: This is a major intermediate with principal use the production of benzene. Often used to boost octane in gasoline for the premium unleaded grades. Xylenes (mixed): CAS 1330-20-7: This is traded to produce ethyl benzene (for production of styrene) and ortho- and particularly para-xylene. The latter isomer is used for the production of polyester. Isooctane (traded as alkylate): CAS 540-84-1: This is not widely traded but central to the production of high octane, low benzene, low sulphur gasoline and jet-fuel. The additives subject to this review are summarised in Table 1.
The recent use of the additive in China is reported by industry sources to have resulted in the widespread damage to the cylinder and valves of vehicles. This is speculated to have been the result of too much additive (many times the recommended dosage) being used.
TABLE 1 SUMMARY TABLE COMPOUND CAS No Mentioned in Legislative Rules as Gasoline Additive US Europe yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes yes
Methanol Ethanol
TBA MTBE DIPE ETBE TAME ETAE
Isopropanol n-propanol Isobutanol sec-Butanol n-Butanol

MMT
Ferrocene Benzene Toluene Butane Isooctane Xylenes (mixed)
67-56-1 64-17-5 75-65-0 1634-04-4 108-20-3 637-92-3 994-05-8 919-94-8 67-63-0 71-23-8 78-83-1 78-92-2 71-36-3 12108-05-8 102-54-5 71-43-2 108-88-3 106-97-8 540-84-1 1330-20-7
EFFECTS ON PETROL CHARACTERISTICS, ENGINE EFFICIENCY, COMPATIBILITY, AND EMISSIONS PROFILE

Background to Octane Boosters Octane is a measure of a fuels tendency to knock in a test engine when compared to other fuels [MAPLES, p.25]. Knocking occurs when the fuel/air mixture explodes on the compression stroke of the engine cycle, ie before the application of the spark. This creates a loud knocking noise within the engine and can lead to engine damage. For ranking fuels, the fuels are compared to certain standards in a special test engine (CFR test-engine). Isooctane (2,2,4-trimethylpentane) has a low tendency to knock and is given an octane number value of 100. Normal heptane, on the other hand, has a great tendency to cause knocking and is given an octane number value of zero. The octane number of a fuel is that value which will give the same knocking tendency of a proportional mixture of isooctane and n-heptane. Research Octane Number (RON) is determined in the test engine at a relatively low speed (600 rpm). This is to simulate city driving at low speed with frequent acceleration. Motor Octane Number (MON) is measured at higher speed (900 rpm) which simulates highway driving. For most fuel components RON is greater than MON. Whereas RON and MON are determined in a laboratory test engine, road octane is properly determined by road tests of vehicles or dynamometer testing of vehicles. Road octane is not the same as the average of RON and MON with which it is sometimes confused. The relationship between the road octane and RON and MON is dependent upon the vehicle being tested. In other words, vehicles with the same nominal compression ratio may require different levels of octane for optimum performance. To avoid the issue of vehicle variability it is usual practice to produce (ie. sell) a gasoline octane slightly higher than that required from a consideration of vehicle compression ratios (often referred to as octane premium or octane give-away) There have been several attempts to solve the problem of relating RON and MON to road octane [MAPLES 1993, page 26]. As well as RON and MON the difference between them is used to judge fuel quality. This is known as the sensitivity of the fuel and a maximum value is specified for the gasoline; typically the sensitivity should be less than 10. In the USA the average of RON and MON (referred to as (R + M)/2 or blending octane BON) is often quoted.
Chemistry From the standpoint of fundamental chemistry we are concerned with the propensity of an explosive mixture of air and fuel to detonate. The chemistry of flames is well known [SEMENOV]. Flames and explosions have three phases - initiation, propagation and termination. The chemistry is dominated by free radical reactions in all stages. In considering octane, we are concerned about the suppression of the initiation of the process until application of the spark. An obvious method is to provide a fuel with an innately high resistance to the formation of free radicals (eg aromatics) or a component, which acts as a free radical trap or quench. It is in this latter role that organometallic compounds act. These compounds are relatively thermally unstable and easily produce low energy free radicals with a low propensity to form free radical chains but will act as free radical scavengers. Thus if chain forming free radicals are formed, these are quenched by the low energy free radicals formed from the additive. Quenching continues until the application of the spark, which produces a massive wave of high-energy free radicals, which initiates the explosion. Free radical quenches and traps are very efficacious and are used in very small amounts, typically in the parts per million range. The most widely used octane booster has been an alkyl lead compound. Many other organometallic compounds have been studied of which one, MMT has emerged as a realistic alternative. Other organometallic compounds based on iron have been used. As might be expected from the above discussion, the effectiveness of the octane booster is dependent on the nature of the hydrocarbon components in the fuel. This is well known for lead alkyl compounds which have been extensively studied [GARY 1984, page 199]. The adverse influence of aromatics on the effectiveness of MMT has also been reported [RMIT 1994]; high aromatics lowers the effectiveness of MMT. By contrast, alcohols and ethers primary role is to provide high-octane blendstock. Alcohols and ethers have octane values typically greater than 110 RON. Thus when blended into a basestock of octane value about 90, in volumes of several percent (ie many orders of magnitude higher than used for the organometallic compounds) an octane boost occurs. Although these oxygenates are not primarily radical quenches, they may serve a role in this action (especially given the high concentration at which they are used). This is evidenced by the higher blending octane values of oxygenates than the natural octane when used as a fuel in their own right [RMIT 1994]. Octane Values of Oxygenates Again there is some variation in the efficacy of the oxygenate with the composition of the fuel. This was demonstrated in the Australian context by research in 1982 [BRAUN]. This work determined the blending octane for various octane boosters with three different basestocks.
The salient data from this work is given in Table 2. TABLE 2 EFFICACY OF OXYGENATES ON PETROL OF DIFFERENT COMPOSITION Petrol A B C RON 89.2 88.4 86.1 MON 80.0 82.3 78.3 Saturates (%) 57.3 68.4 50.7 Olefins (%) 7.3 0.6 28.3 Aromatics (%) 35.5 31.0 21.0 Blending RON MTBE 121 120 120 Methanol 135 140 135 Ethanol 132 138 135 TBA 107 107 114 Toluene 115 113 114 Blending MON MTBE 103 109 102 Methanol 100 111 98 Ethanol 105 115 102 TBA 91 88 93 Toluene 92 96 94 These results clearly demonstrate that the alcohol additives are sensitive to the composition of the gasoline. Particularly note the Sensitivity (RON - MON) for ethanol which is much larger than the sensitivity for MTBE. This underlies refiners concerns that ethanol may be inadequate for lifting MON values and maintaining final gasoline sensitivity within specification. Inspection of the literature indicates a wide variation of octane values for the additives of interest. This is presumed mainly due to the variation in the chemical composition of the base stocks used in the determination (often not given). In this Study we have used data presented in the RMIT report for blending calculations: Table 3. TABLE 3 Methanol Ethanol
IPA TBA MTBE ETBE TAME
EFFECTIVE BLENDING VALUES RON sg (kg/L) % O2 (wt.) MON 0.796 49.9 130 100 0.794 34.7 115 100 0.789 26.6 117 100 0.791 21.6 100 90 0.744 18.2 110 100 0.770 15.7 112 100 0.770 15.7 105 100
RVP (kPa) 250 130 70 65 55 28 7
Fuel Blending Overview In refineries, gasoline is made from several refinery streams. Traditionally these were mixed in a tank. The modern practice is to use in-line blending (ie mixing in a pipeline), which eliminates costly storage and tankage. To the final gasoline is added butane. This raises the RVP level to the limit of the fuel specification. MTBE and other ethers (TAME, ETBE, DIPE) are compatible with the gasoline blend streams and can be blended along with the other streams within the refinery. Water is a common contaminant of streams within refineries and tanks. As well as process contamination it enters the system by condensation of water vapour in the storage tanks and tanker trucks. Because water is heavier than and substantially insoluble in gasoline, the water separates at the bottom of the tank. The water can be drained off and properly sent to a water treatment unit. A fully anhydrous blending and distribution system is technically feasible but is very expensive and is only used in the transport of chemicals where water contamination is a serious problem or hazard. Unlike ethers and the hydrocarbon components of gasoline, alcohols are very soluble or miscible with water. Traces of water in a gasoline will cause substantially all of any methanol present to separate. This is often referred to as the fungibility problem of methanol. Ethanol is somewhat better, but the presence of water at the bottom of a tank results in a large portion of the ethanol separating from the gasoline. Propanols (IPA and n-propanol) are better, and separation of the butanols is slow and can be handled like ethers. Because of the problems with ethanol, it is not added within the bounds of the refinery, rather it is added at the distribution centre, which would supply individual retail outlets. This minimises water contamination in the distribution train. This method is often referred to as splash blending and is often performed in a storage tank or a road tanker. In some cases mixing within lines feeding a tank controls the mixing more precisely. Non-Ideal Behaviour: Because gasoline hydrocarbons and the lower alcohols (methanol and ethanol) are dissimilar, their mixtures show non-ideal behaviour as far as vapour pressure is concerned. This nonideal behaviour is well known. Its main consequence is the vapour pressure above an ethanol-gasoline blend is higher than would be expected (given a consideration of the pure liquid vapour pressures and the relative concentrations in the mixture). The consequence is that it is very difficult for ethanol-gasoline mixtures to achieve the sought after vapour pressure limits of the proposed gasoline standards, namely 60 kPa maximum in the summer period for Euro-3 and 55 kPa for Euro-4.
Blending Studies In order to illustrate the main issues, we have conducted some simple blending estimates for the oxygenate additives [EXHIBIT 19]. In the first simulation (Table 4) we estimate the properties of a final gasoline resulting from the addition of oxygenates. The oxygenates were added in the volumes that have typically been used in Europe and the USA. The base gasoline had properties similar to the composition of the present Australian pool average. This shows how oxygenates might be used to lift the present gasoline to the 95 RON octane requirement. TABLE 4 SIMULATION 1 Adding Lower Alcohols to Australian 1998 Pool Gasoline10 Petrol Methanol Ethanol Ethanol Volume % 100 3 5 10 LHV (MJ/L) 32.68 32.55 33.30 32.63 Oxygen (%wt.) ~0 1.57 1.81 3.61 RON 91.6 92.8 92.8 93.9 MON 82.5 83.0 83.4 84.3 RVP 60.0 78.2 67.8 74.6 Adding TBA and Ethers to Australian 1998 Pool Gasoline TBA Petrol MTBE ETBE Volume % 100 7 15 15 LHV11 (MJ/L) 32.68 32.23 31.55 32.0 Oxygen (%wt.) ~0 1.57 2.68 2.38 RON 91.6 92.2 94.4 94.7 MON 82.5 83.0 85.1 85.1 RVP (kPa) 60.0 60.5 59.1 55.0
IPA
10 31.86 2.75 94.1 84.3 61.7 TAME 15 32.0 2.38 93.6 85.6 51.8
Our results show that starting from a typical ULP gasoline with a 92 RON, 95 RON is effectively achieved using ethers at about 15% by weight. The final gasoline sensitivity (RON - MON) is <10 and the target MON > 85 is achieved. Ethers do not compromise the proposed specification concerning oxygen content (2.7% max.) or RVP (target 60 kPa). In respect of RVP, the data illustrate that it may be possible to add additional butane to the final mixture. None of the alcohols achieve the target specification. Ethanol and IPA at 10% are the best at approaching the 95 RON target. However, for ethanol at 10%, the RVP value is well over the 60 kPa target and even exceeds 60 kPa at 5%. At 10% ethanol, oxygen is well over the 2.7% limit but the heating value of the fuel is only marginally less than the basestock. Using alcohols, sensitivity declines slightly and none of the alcohols achieve the 85 MON target.
10
RON and MON data for Regular Unleaded Petrol as detailed in Setting National Fuel Quality Standard Paper 2, page 51; base gasoline assumed available at RVP 60 kPa. 11 Lower heating value or net heating value expressed on an energy per unit volume basis. Page 19 Duncan Seddon & Associates Pty Ltd.
In a second simulation, we start with the target petrol with 95 RON, a sensitivity of 10, and an RVP of 60 kPa (as required using the Euro-3 standard) and containing the above volumes of additive. We then estimate the properties of the basestock when the oxygenate is backed out of the gasoline. This gives a view of the quality of the basestocks required when using the various oxygenates. The results are given in Table 5. TABLE 5 SIMULATION 2 Subtracting Alcohols from Euro-3 Gasoline Petrol Methanol Ethanol Ethanol 100 3 5 10 Basestock required 95 93.9 93.9 92.8 85 85.9 85.9 84.8 60 39.8 51.2 41.5 Subtracting Ethers from 95 Euro-3 Gasoline TBA Petrol MTBE ETBE 100 7 15 15 Basestock Required 95 94.6 92.4 92.0 85 86.6 84.4 84.0 60 59.5 61.0 65.9
IPA
Volume %
RON MON RVP
10 92.6 84.6 58.0 TAME 7 93.2 85.2 69.7
Volume %
RON MON RVP (kPa)
This illustrates the superior value of the ethers because the blendstock that is required is generally inferior to that required when blending with alcohols. Excepting ethanol and IPA at 10% level, the alcohols require a basestock not too different from the Euro-3 target. Ethanol at the 10% level contains oxygen in excess of the Euro-3 target level. Ethanol Blending The blending of ethanol has received a considerable amount of attention with respect to the influence of the ethanol concentration on the finished gasoline RVP and the distillation curve. Mathematical simulation is difficult because of the non-ideal behaviour of ethanol/gasoline mixtures and complicated interactions with the various components of the gasoline. Extensive modelling work has been conducted for the Californian Energy Commission by Math Pro. Inc. [EXHIBIT 18]. The work presented data for RVP and distillation curve for Californian gasoline. Note this gasoline would have considerably lower aromatics than those proposed for Australia under the Euro-3 standards. The Math Pro Inc. work shows that the actual RVP is dependent on the nature of the gasoline and that the increase in RVP is higher at lower concentrations of ethanol. This confirms earlier work [EXHIBIT 22, figure 9] that shows a major rise in RVP when up to 5% ethanol is added.
To get a better understanding of this issue we have produced estimates for the RVP at various levels of ethanol addition using blendstock of varying RVP; Table 6. TABLE 6 SIMULATION 6
RVP at 5% (vol.) Ethanol into Gasoline (kPa) RVP of base stock gasoline (kPa) 40.0 45.0 50.0 55.0 RVP of final blend (kPa) 50.0 54.5 58.9 63.4 Delta RVP (kPa) 10.0 9.5 8.9 8.4
60.0 67.8 7.8
Our results indicate that splash blending ethanol causes a bigger increase in RVP the lower the RVP of the base stock gasoline. The above table indicates that if we target 60 kPa in the final gasoline (Euro-3) then using 5% ethanol we need gasoline basestocks with an RVP of 50 kPa or less. Selecting base gasoline for this duty is a complex procedure but we get some idea of the issues by considering the RVP of some of the streams that might contribute to gasoline. Selected properties of typical refinery streams are given in Table 7. TABLE 7 TYPICAL PROPERTIES OF REFINERY STREAMS Refinery Stream Butane Light Straight Run Isomerate FCC gasoline Alkylate Reformate
RVP
(kPa) 358 88.2 108.2 48.9 53.8 31.7
Olefins (% Vol.) 0 1.0 0.4 29.4 0.5 0.7
Aromatics (% Vol.) 0 3.9 0.9 29.3 0.4 66.2
RON
94 75 83 92 93 99
The table illustrates that to achieve a base gasoline of RVP of 50 kPa or less would require the use of major volumes of Reformate and FCC gasoline, both of which are high in aromatics and have a naturally high octane. A preliminary conclusion is that ethanol may not contribute to octane if an RVP cap of 60 kPa applies, because the base gasoline would have very high octane as a consequence of a high aromatic and olefin content. Climate Australia does not suffer the cold weather drive-ability problems of parts of Europe and USA. The drive-ability issues (volatility) concern hot weather drive-ability and the specifications for volatility in hot climatic conditions (summer and northern Australia).
The main problem is with carburettor fitted vehicles. The issue has been extensively researched in Europe [CONCAWE 99/51; EXHIBIT 21]. The report sets out a detailed analysis of RVP versus the E70 value for the individual countries. In simple terms, the drive-ability can be classified in terms of Vapour Lock Index (VLI) Where: VLI = 10 x RVP (kPa) + 7 x E70 RVP is the Reed Vapour Pressure E70 is % of fuel distilled at 70C The VLI should be less than 900 for hot climates. From the standpoint of oxygenates, the main issue is raising the RVP and minimising the volume distilled below 70C. Further analysis of this issue relies on a detailed knowledge of the basestock and is beyond the scope of this work. Alcohol and Ethers Emissions profiles The improvement in emission profile when oxygenates are used in gasoline is well known and the basis for the US RFG Program. Data is substantial on the use of the additives in a wide range of vehicles and conditions. These were reviewed in the earlier study [RMIT]. One of the issues that has arisen in the recent controversy on the use of MTBE is analysis by University of California workers who have suggested that gasoline can be formulated to give the required air quality benefits without using MTBE (or other oxygenates) [EXHIBIT 24]. This view is disputed by several other groups; this will be discussed in more detail when the environmental impact of the additives is considered. Of pertinent interest is the Australian situation with a relatively large number of carburettor fitted vehicles which would use lead replacement petrol. Braun has presented extensive data on CFR test engines. Full vehicle tests have been performed by Repco [BRAUN]. The salient feature of the data is shown in the attached data; Table 8. This shows the emissions profile produced by using various additives on the three petrol formulations given above in Table 2. Tests were performed at 600 rpm (typical for determining RON) and 900 rpm (typical for determining MON) at fuel rich (air/fuel ratio = 13.5) and a fuel lean (air/fuel ratio = 16). The three petrol types without additive did not differ markedly from each other. Data is given relative to the emission without additive.
The general observations were: Additive reduced CO emissions and hydrocarbon emissions under lean burning conditions Under lean burning conditions, hydrocarbon emission depended on the petrol composition. High aromatics being associated with an increase in the amount of hydrocarbon emission. Nitrogen oxides increase under fuel rich conditions but fall under fuel lean conditions. A similar observation is made for aldehydes.
The data reveals there are differences in emissions between the additives. However, the additives were all used at the same level (10%) and after correcting for oxygen content, there does not appear to be much difference between MTBE and ethanol. This work was extended to include engine tests on multi-cylinder engines. This showed little difference in the torque developed. One engine showed problems with MTBE additive which was judged to be due to an unusual carburettor geometry, this being affected by the lower viscosity of the fuel containing MTBE (resulting in a richer mixture). In other respects the full engine tests confirmed the CFR test engine results. Modern engines fitted with lean burn systems and catalytic converters would substantially reduce the noxious gases (unburnt hydrocarbons, nitrogen oxides and carbon monoxide) from the tailpipe. Greenhouse Focusing on the vehicle greenhouse benefits arise by improving fuel octane and thereby allowing the use of higher compression, more fuel efficient vehicles. The downside is that higher octane, inevitably requires higher greenhouse emissions in the refinery. This is discussed elsewhere. From the standpoint of the additives themselves ethers and alcohols, other than ethanol, are produced by energy intensive processes and result in considerable greenhouse emissions. As a very rough guide, based on process thermal efficiencies, each tonne of additive produced will cause a tonne of carbon dioxide emission. From the standpoint of Australia (and Europe) most of the additives will be produced in countries that are not signatories to the main Kyoto protocols (eg Saudi Arabia) and so these emissions would not count to the overall emission levels. Thus boosting octane by using imported additives may help Australia (and Europe) achieve its Kyoto commitments because this action will require less intensive operations within the nations refineries. Ethanol can be produced by petrochemical processes or from biomass. For the most part we are concerned with biomass produced ethanol. Proponents claim the use of bio-ethanol produces significant greenhouse savings because the resource is renewable.
TABLE 8
CHANGES IN EXHAUST EMISSIONS AT 10% ADDITION RELATIVE TO PETROL WITHOUT ADDITIVE [BRAUN]
%CO %O2 %CO2 %CO2 HCppm HCppm NOx ppm Aldehyde(ppm)
A/F ratio 600 RPM MTBE Methanol Ethanol

TBA
13.5 -0.6 -1.8 -1.3 -0.9 -0.3 -0.6 -1.9 -1.2 -0.8 -0.3
16 +0.4 +0.2 +0.7 +0.3 +0.2 +0.3 +0.9 +0.6 +0.3 +0.1
13.5 +0.4 +1.1 +0.8 +0.5 +0.3 +0.3 +1.1 +0.7 +0.4 +0.4
16 13.5 Petrol A -0.4 -0.3 -0.6 -0.3 -0.1 -0.3 -0.7 -0.5 -0.3 -0.1 -169 -410 -278 -133 n -49 -304 -196 -122 -102
16 +165 +148 +100 +845 +238 -48 +125 -20 -28 +25
13.5 +443 +1548 +1048 +707 +161 +1023 +660 +594 +558 +170
16 -277 -73 -573 -229 +50 -180 -771 -566 -246 +49
13.5 0.0 +1.43 +0.93 +0.33 +0.10 +0.65 +2.30 +1.33 n +0.81
16 -0.16 -0.55 -0.25 -0.09 -0.09 +0.03 +0.22 +0.21 +0.35 -0.04
Toluene 900 RPM MTBE Methanol Ethanol

TBA

TBA
Petrol B -0.6 -1.8 -1.1 -0.8 -0.2 -0.6 -1.8 -1.3 -0.7 -0.2 +0.5 +1.0 +0.7 +0.4 +0.2 +0.6 +1.0 +0.6 +0.4 +0.2 +0.28 +1.11 +0.55 +0.42 +0.27 -0.35 -0.65 -0.45 -0.25 -0.15 -0.5 -0.7 -0.5 -0.2 0.0 Petrol C 600 RPM MTBE Methanol Ethanol
TBA

TBA
n -362 -84 n n
+743 +33 -3 -10 +51 +13 +28 +40 +33 +18
+323 +1556 +740 +557 +239 +344 +157 +1128 +298 +106
-291 -742 -561 -234 +37 -315 -544 -364 -134 -3
n +2.4 +1.7 +2.4 +1.9 n +0.8 +1.1 -0.7 n
-0.15 +0.08 +0.13 -0.16 +0.11 -0.10 -0.03 +0.03 -0.03 -0.06
Toluene

TBA
-0.5 -1.9 -1.2 -0.8 -0.2 -0.7 -1.2 -1.3 -0.8 -0.4
+0.3 +1.1 +0.7 +0.4 +0.2 +0.6 +0.9 +0.6 +0.4 +0.2
+0.3 +1.2 +0.6 +0.4 +0.2 +0.4 +1.3 +0.8 +0.4 +0.4
-0.3 -1.0 -0.7 -0.4 -0.1 -0.4 -0.8 -0.4 -0.3 0.0
n n n n n n -201 -211 n -322
-24 -6 -74 -2 +61 -51 -3 -6 -33 +77
+299 +1463 +829 +445 +87 +305 +1567 +838 +500 +260
-295 -246 -762 -442 -66 -201 -304 -233 -208 +70
+0.40 +1.80 +1.70 n n +0.97 +1.06 +1.00 n -0.77
-0.07 +0.10 -0.03 +0.01 +0.04 +0.01 -0.09 -0.01 +0.07 +0.10
Toluene
Ferrocene Ferrocene additive is available as the additive PLUTOcen(R) by Associated Octel. Technical literature provided by Octel [EXHIBIT 27] show the additive at 30 ppm to have a dramatic effect on low octane basestocks. With a base of 80 RON an octane gain of 2 is achieved. There is a slightly less impact on the MON. However, with a base of 90 RON, the octane gain is 1.6, but the MON gain is only about 0.8. Octel present comparative data against MMT. This demonstrates its higher efficacy from the standpoint of metal content, but a lower efficacy towards the MON of the basestock. The impact of gasoline hydrocarbon composition on the efficacy of the additive is not given. Emissions Performance Octel state that field performance trials substantiate all of the marketing claims. This data is available on a confidential basis and has not been pursued at this stage. Impact on Catalysts Octel data indicates that there is no reduction in the efficiency of sensors or catalysts. Catalysts equipped vehicles show catalyst efficiency is maintained (ie protects the catalysts against aging). However, there is a small decrease in the conversion efficiency of nitrogen oxides at low mileage (<60,000 km). Impact on Spark Plug Fouling and On-Board Diagnostics, Octel technical data refutes the belief that this additive is erosive. Extensive tests have shown no detrimental damage to any engine part [EXHIBIT 28]. MMT The use of MMT as an octane booster has been studied extensively for 30 years with about 20 years of on road experience with the additive. MMT is produced by Ethyl Corporation and is available as a proprietary additive HiTEC 3000. Ethyl have provided a substantial amount of documentation to this Study describing many aspects of MMT [EXHIBITS 1,2 AND 25]. Efficacy MMT is used in very low quantities, typically 18 mg Mn/L. Correlation curves for the additive for different fuel blendstocks are known. MMT produces an octane gain according to the following equations [RMIT 1994]: RON Gain = 0.0615(Mn 0.5){42.75 - 0.3868(RON) - 0.02168(A)]
MON Gain = 0.01527(Mn 0.75){43.04 - 0.3868(MON)] 0.003788(Mn)[0.06075(A) + 0.6409(SENS)] Where: RON = Research Octane Number (lead free) MON = Motor Octane Number (lead free) SENS = Sensitivity (RON - MON) A = Volume percent aromatics Mn = Manganese concentration mgMn/L Application of these equations to the average basestock for the Australian gasoline pool (Octane 91.6 RON) shows that MMT at 18 mg Mn/L will lift RON by about 1.5 and MON by about 0.5. Thus, MMT cannot of itself be used to raise the octane to the Euro-3 level (95 RON). However, MMT is not sensitive to the presence of materials other than aromatics (ie. alcohols, ethers) and MMT could find a role in trimming gasoline blends, which may contain oxygenates in order to ensure the minimum value of octane is obtained. Emissions Performance Emissions tests on the use of MMT indicated the following effects on tail pipe emissions [EXHIBIT 1]: A small fall in the amount of carbon monoxide (CO) emitted. A more substantial fall in the level of nitrogen oxides emitted. No evidence for an increase or decrease in the amount of unburnt hydrocarbons emitted. Evidence of a reduction in other toxic gases (formaldehyde, acetaldehyde and benzene) as a consequence of allowing refiners to optimise blending.
MMT has an impact on lowering global carbon dioxide emission by improving refinery efficiency and hence internal fuel use. This could be as much as 3 or 4 %. Further the lower nitrogen oxides of the tail-pipe emissions has an effect on lowering nitrous oxide emissions (a major greenhouse gas). Impact on Catalysts Ethyl Corporation claims [EXHIBITS 1 & 2, supported by Ford SAE 821193 in EXHIBIT 25 item 2] that MMT maintains significantly higher catalyst conversion efficiency over the life of the catalyst converter. The mode of action seems to be by protecting the catalyst against the slow degradation and poisoning by other components such as phosphorus and zinc. This is the complete contrast to lead, which irreversibly poisons catalysts.
Valve Seat Recession Higher than normal use of MMT (>0.018 mg Mn/L) provides protection from wear of soft exhaust valve seats (valve seat recession). This is a particular problem for cars designed to operate with leaded petrol. The UK and French governments have approved MMT for VSR applications. It has been extensively used in California for this use12. From discussions with the industry, MMT is not used in Australia as an additive to produce lead replacement petrol nor is it present in VSR additives currently available here. Impact on Spark Plug Fouling and On-Board Diagnostics Ethyl Corporation disputes early reports that MMT can cause spark plug fouling and interferes with onboard diagnostics [EXHIBITS 1 and 3]. Automotive Finishes and Parts One of the main concern of the auto makers is the impact of gasoline additives on finishes (paint, varnishes, vinyl etc.) and engine parts (rubber hoses, metal components etc.). There is a paucity of information on this problem. A 1988 American Petroleum Institute publication [No. 4261); EXHIBIT 22] reviews the effects of the additives on plastics and rubbers. When blended at the 10% level with gasoline the additives cause elastomers (rubbers) to swell. The salient details are given in Table 9: TABLE 9 IMPACT OF ADDITIVES ON ELASTOMERS Volume % Swell, After 72h Immersion 10% additive in gasoline (30% aromatics) MTBE gasoline methanol ethanol 0 27 3 2 11 42 37 13 14 21 18 34 53 51 34 44 112 136 49 41 56 48 137 109 124 139 169 148 176 -
Elastomer FKM (fluorocarbon) Polyester urethane Fluorosilicone Acrylonitrile/butadiene Polyacrylate Chlorosulphon. polyethylene
EPDM
Natural Rubber
This data illustrates the advantages of MTBE when compared to methanol and ethanol.
12
[EXHIBIT 1; EXHIBIT 25 details the state of regulatory approvals in US, Europe, China, Canada Russia and Argentina].
There is almost universal agreement that methanol is not a favoured additive for the general vehicle fleet13. The main concern is the ability of the additive to act as a solvent. However, irrespective of solvent powers, methanol is known to corrode (ie. react with) certain metals high in the electrochemical series (zinc, aluminium and in particular titanium). Any component containing these elements would be potentially attacked by methanol. There is some concern that ethanol blends may promote rusting of gasoline tanks and antirust additives have been proposed. Gasoline contains hydrocarbons of generally low solvating power. When considering the impact on paints and parts, the question is how far the additives differ from gasoline hydrocarbons. Solvent interactions are complex and a full analysis is beyond the scope of this review. Here we present a simple view using the solubility parameter (SP, which is dependent on fundamental thermodynamic properties of the solvent) and fractional polarity (FP, which is dependent on the ionisation constant, dielectric constant and polarizability). The further the additives depart from the values of hydrocarbons, the more likely a solvent issue is likely to arise; Table 10 TABLE 10
SOLUBILITY PARAMETER AND FRACTIONAL POLARITY OF SOME ADDITIVES
hexane toluene methanol ethanol n-propanol

IPA
butanols ethers Aggressive Solvents acetone nitromethane
SP 7.3 8.9 14.5 13.2 11.9 11.5 ~11 ~10 10 12.6
FP 0 0.001 0.388 0.296 0.152 0.178 ~0.1 ~0.1 0.695 0.780
This table illustrates that the additives would have greater solvating power than hydrocarbons. Of most concern would be methanol and ethanol. It has been suggested that automotive finishes can be affected, especially on older cars with lacquer finishes, with ethanol concentration >20%. This is well out of the range being considered for the new standards. Further, there is long history of use of ethanol at the 10% level in Australia with no apparent problems. Elsewhere there is a long history of use with the other additives under consideration We conclude that there will not be a problem with oxygenates causing problems with automotive finishes and fixtures.
13
Methanol fuel vehicles are specially made for that fuel.

MMT MMT is a hydrocarbon soluble liquid, insoluble in water, and it would be expected to have similar solvating powers to the main gasoline hydrocarbons. Further, it is only used in parts per million amounts. It is generally introduced diluted in hydrocarbons (naphtha). We would conclude that there would be no problems with MMT from the standpoint of attacking automotive finishes. Ferrocene Ferrocene is slightly soluble in water (6.3 mg/L), but used in hydrocarbons in the ppm level. We would not expect any problems with the use of this additive on automotive finishes. Automotive Industry Views The automotive industries views are expressed in the World-Wide Fuels Charter (WWFC) [EXHIBIT 23]. In essence the WWFC expresses the opinion that ash-forming additives, MMT and ferrocene, are to be avoided because of perceived detrimental effects on the engine and ancillary systems. As far as oxygenates are concerned, MTBE and ethanol (with restrictions) are acceptable.
FINANCIAL COSTS OF THE ADDITIVES

Background Gasoline is an important and major traded commodity. There are three principal markets from which all other local markets take their lead - US Gulf, Rotterdam and Singapore. At any instant there are large volumes of gasoline at sea or in storage. Using this fluidity, extensive real-time spot market trading ensures that the price differentials between the major markets are minimised. Thus a sudden demand and price rise in one market is rapidly satisfied by products supplied from another market that in turn results in price rises in the supplying markets. Gasoline is not traded as final product rather as blend stocks. This facilitates the safe handling and transport by having a low vapour pressure. The final blender (gasoline wholesaler) adds butane to boost the vapour pressure (RVP) to the allowable limit14. Blend stocks are supplied with a range of properties, but for sales purposes all product is corrected to the same density. The major characteristic is the octane value (RON clear15) of the blend stock. The sales of gasoline in the major markets is so large that the blend stock is available and sold over a wide range of octane numbers (typically from 87 RON to over 100 RON), although only the value of the higher volume grades are often reported16. For example the Singapore averaged market quotes for 21 March 2000 (Petroleum Argus) 97 RON 95 RON 92 RON 30.15 US$/bbl 29.65 US$/bbl 28.95 US$/bbl
In considering the value of octane boosters we are concerned with the differential between the grades of octane blend stock rather than the absolute value - which rises and falls with the price of crude oil. The above figures illustrates that on this day there was a differential of 0.7 US$/bbl between the 92 and 95 RON grades and a differential of 0.5 US$/bbl between 97 RON and 95 RON. Thus from the standpoint of octane, the differential rises with increasing octane. In fact the recent oil price volatility has reduced these differentials and it is often found that the differentials are 97 - 95 ~ 1 US$/bbl and 95 - 92 ~ 0.5 US$/bbl. There is a marked cost penalty going over 95 RON. This is a consequence of the economics of operation of reformers, which principally increase the octane of the blend stocks by
Plus proprietary additive packages. Clear indicates lead free. 16 Examples of the main reporting agencies are Standard & Poors Platts, Reuters, Argus. Such agencies provide electronic and hard copy market summaries.
15
14
increasing the level of aromatics. High severity reforming which produces octane numbers over 95 RON have the consequence of large gas generation (waste) in the reformer. We thus see that the price of octane is typically 0.16 US$/bbl to about 95 RON and about 0.5 US$/bbl over 95 RON. Chemical Markets For the larger volume chemicals (methanol, ethanol, BTX) there are well-established spot markets from which markets of minor commodities take their lead. However, in contrast to oil markets, a major part of production is sold on contract. Shipping Gasoline and chemicals are regarded as clean cargoes. There is a large dedicated tanker fleet. Gasoline is often shipped in relatively large carriers (80,000 tonne parcels), whilst chemicals such as methanol are shipped in multi-tank vessels in parcels of 2000 to 10,000 tonnes. Shipping costs are complex and are a function of the size of the ship, the state of the shipping market, geographic distance and location and the possibility of a back-haul cargo. As a rule of thumb the cost of moving oxygenates into or out of Australia would be expected to be in the region of US$ 30/t. The cost of shipping a somewhat larger parcel of gasoline might be about US$ 15/t (c. $ 2/bbl). From the standpoint of shipping costs, there would thus be an incentive to import the oxygenate already blended into a gasoline basestock. Methanol Methanol is a widely traded commodity chemical. Chemical prices are not directly related to the prevailing price of crude oil or oil derivatives such as gasoline. Chemical prices show pronounced variations based on business cycles. Thus although the price of methanol can range between US$ 80/tonne and sometimes over US$ 300/tonne, the long term average is about US$ 135/tonne. At a notional exchange rate of A$ = 0.6 US$ this average value is about A$ 18 c/L. Supply Nowadays, most methanol is made from natural gas. The production of methanol demands large volumes and large exporting plants have been constructed at locations where low price gas is available. World capacity is 33.6 Mt/a. Most plants service a specific market, with the trade being dominated by a relatively small number of world-scale plants. Australian production There is a small methanol plant at Laverton in Victoria supplying the local demand (ca. 160 t/d). World-scale methanol plants have capacities of over 2000 t/d. There have been
proposals (there are two currently active to the knowledge of the author), to establish world scale operations in northern Australia. Ethanol Traded Prices in Ethanol Ethanol is extensively traded in the US with the price reported by specialist reporting agencies. Because fuel ethanol is used as a gasoline extender, the price varies with the prevailing price of gasoline. Tax Incentives for Ethanol [EXHIBIT 12] Ethanol in the US is subsidised by the Federal Government. The subsidy is paid mainly to the sellers of gasoline. Each gallon of ethanol that is blended results in a US$ 0.54 tax credit. This credit can be claimed either as an income tax credit or as an excise exemption. A caveat on the subsidy is that the ethanol must be made from biomass not fossil fuels. ETBE is regarded as using ethanol and receives a tax exemption based on the volume equivalent of ethanol These tax incentives are aimed at making ethanol price competitive with gasoline and MTBE. At a present notional exchange rate of A$ = 0.6 US$, this subsidy is equivalent to A$ 0.238/L (ie about 24 c/L or about A$ 190/t). In Australia, fuel ethanol is excise free, which is equivalent to a tax benefit of about 45 cents/litre. Supply Ethanol can be made from either petrochemicals or from biomass. Total production is about 24 Mt/a (32,000 ML/a, 560,000 bbl/d). North America and Brazil dominate fuel ethanol production. In the US the capacity is 107,000 bbl/d from biomass (mainly corn) and 13,000 bbl/d from petrochemicals. Brazilian capacity is around 260,000 bbl/d. Other centres of production are France (8,000 bbl/d), Canada 2,700 bbl/d). The Far East has a capacity of about 90,000 bbl/d mainly in China and India. Ethanol in Australia Total annual production is about 160 ML (ca. 2760 bbl/d)17. There are three main plants: Manildra Group currently produces 70 ML with plans to expand to 100 ML in 2000. CSR Distillers currently produce 50 ML, of which about 60% is exported. Rocky Point produces 8.10 ML. The 160ML annual production is less than 1% of Australian gasoline demand (18,033 ML). To the oxygen limit of the Euro-3 standard (2.7% oxygen; 7.8% ethanol) an annual production of 1320ML ethanol would be required.
17
Data provided by Fuel Ethanol Association of Australia.

Demand World demand is about 486,000 bbl/d or about 87% of world capacity. Given plant outages etc. this indicates that supply demand is approximately in balance. The dominant user is Brazil where ethanol is used in all gasoline sold. The demand is about 220,000 bbl/d. This demand is satisfied by the nations own production and none is available for export. The next largest use is for industrial uses (solvent etc.) followed by the demand for fuel ethanol and as a fuel additive in the USA. Beverage use accounts for the rest. MTBE MTBE is widely traded on the US and European fuel and chemical spot markets. Tracking MTBE prices reveals that MTBE is linked to the prevailing price of regular gasoline with a premium of about 15%. Production The production of MTBE involves the facile reaction of methanol with isobutene. Methanol is a world commodity chemical readily available (see above). The main issue is the availability of isobutene. There are three main sources: The refinery operation of fluid catalytic cracking (FCC) produces a byproduct gas stream that contains isobutene. This stream is often fed to an MTBE unit where the isobutene in the stream preferentially reacts and is converted to MTBE. After purchasing methanol, this gives the refiner a ready source of MTBE within the refinery boundary. A more substantial source of isobutene is the C4 cracked gas stream from pyrolysis cracking of gas oil or naphtha to produce ethylene. This stream contains a substantial volume (up to 50%) of the valuable commodity 1,3-butadiene and this extracted for further use. After butadiene extraction, the residual stream contains a major portion (up to 50%) of isobutene that can be converted into MTBE. This is a major source of traded MTBE. Isobutene can be made from LPG. This requires the isomerisation of normal butane to isobutane followed by dehydrogenation to produce isobutene. This route is energy intensive and has high capital and operating costs. However, there are very large plants producing MTBE using this route. These plants are based in the Middle East and Canada and export MTBE to Europe, the USA and the Far East. Supply World capacity is about 21 Mt/a (522,000 bbl/d) with a further 7 Mt/a (172,000 bbl/d) either under construction or in planning. Nearly 50% of the total is in North America. Other major producers are in Europe and the Middle East. Many of the larger plants in the world export to the USA.
Demand World demand is about 390,000 bbl/d, this is about 75% of nameplate capacity and given the number of plants under construction or planned clearly represents an excess of capacity. US MTBE demand is about 250,000 bbl/d which is excess of its production and there is a considerable import Clearly MTBE phase-out in the USA will have a major impact on the MTBE market around the world. Other Oxygenates Of the other oxygenates only ETBE, TAME and TBA are produced in significant volumes. These materials are produced internally within refineries and petrochemical plants. ETBE can be produced in the same plant as MTBE (3.7 Mt/a, 91,000 bbl/d). Many of the newer refinery based plants can swing production between ETBE or MTBE (80,000 bbl/d). Another 10,000 bbl/d ETBE is produced in France. TAME capacity is about 2 Mt/a (47,000 bbl/d). TAME is produced in the refineries using the C5 olefine stream from FCC operations (iso-amylene stream). Unlike isobutene there are no other significant sources other than FCC off-gas and the production of TAME is limited. Plants that produce MTBE cannot easily be converted to produce TAME. However, there are some flexible MTBE/TAME plants in Russia. TBA capacity is about 2.6 Mt/a (60,000 bbl/d). TBA is produced mainly in the USA and Europe where it has some uses as petrochemical intermediate and solvent. Isobutene is again the key precursor, which is reacted with water to produce the alcohol. This data clearly indicates the dominance of MTBE and ethanol as oxygenates and octane boosters. Implication of Californian and US Ban on MTBE A ban or phase-out of MTBE would have a major impact on the supply and availability of oxygenated additives to Australia. Because of the dominance of the US position, a US or Californian ban on MTBE would exacerbate the over-capacity already existing in the industry and result in a fall in MTBE price. In the Asia region, because of the presence of low cost producers, this may result in MTBE falling below the price of gasoline. Such an event would have the consequence on pressure to import and use MTBE in Australia, irrespective of the need for an oxygen booster or added oxygen. An MTBE ban would have a major impact on the trade in other additives. Almost certainly the trade in TAME, ETBE, and possibly DIPE, would be interrupted because of their similarity to MTBE.
At present it is uncertain if the US will persist with an oxygen requirement in the RFG gasoline pool. (The Blue Ribbon Panel, see below, has recommended that the oxygen content regulation should be waived.). Irrespective of an oxygenate waiver, a US led MTBE ban is likely to cause an increase in demand (hence price) of good quality blendstock such as alkylate. If the US persists with the oxygen requirement, this will create an enormous increased demand for ethanol. This US RFG market would set the world price for ethanol. Purvin & Gurtz, Inc. and ESAI have, extensively addressed these issues and several future scenarios, for the US for the California Energy Commission [EXHIBIT 17 and EXHIBIT 26]. A detailed financial analysis was performed by ESAI for the US markets [EXHIBIT 13], which attempted a comprehensive review of the supply, availability and price of alternative oxygenates in the event of a California and a US wide ban. Several supply/cost curves at different scenarios were developed. Using the notional value of A$=0.6 US$, produces the estimates shown in Table 11:
TABLE 11 Prices for Oxygenates Delivered to California (Intermediate Term; from EXHIBIT 13) California Ban on MTBE US c/gal A c/L 69.6 30.7 94.5 41.6 160.8 70.8 98.7 43.5 112.2 49.4 104.7 46.1 17.9 US Wide Ban on MTBE US c/gal A c/L 69.6 30.7 94.5 41.6 171.6 75.6 91.3 40.2 109.3 48.1 100.1 44.1 17.9
Gasoline (basis) MTBE (1997) Ethanol TBA ETBE TAME methanol (for reference)
For the longer term these values may fall. For Australia these supply/costs curves would be different. It would be expected that the sources for ethanol and ethers would be different. For instance there may be indigenous and Far East supplies for ethanol and TAME may best be sourced from Europe. This analysis should be repeated for an Australian scenario but the data presented here will give a ballpark estimate. Referencing the cost to gasoline, we see that the cheapest oxygenate is MTBE and the most expensive oxygenate is ethanol. The cost implication of this for the blender is modified after consideration of the different volumes of additive to be used to achieve a specific oxygen level in the gasoline.
Trade in Gasoline Components (BTX, Alkylate) Benzene toluene and xylene are heavily traded on the Far East Asian chemical markets. There are significant differentials between the countries of SE Asia, which reflect the cost of shipping from the countries of production (Taiwan, Singapore, Korea, and Japan). Benzene and xylenes are highly sought after intermediates for the production of synthetic fibres. Prices depend on the business cycle, with the floor price being determined by the value as octane boosters in gasoline (ie. floor price typically gasoline plus c. 20%). Toluene has no large direct uses in the chemical industry and the prevailing price tends to be near to that of 15% plus the price of gasoline. At present there is no substantial trade in alkylate.
Costs of MMT and Ferrocene MMT and ferrocene additives are priced according to the effect they produce, ie the boosting of octane. The price is determined so that the additive is cost competitive to an alternative option such as the addition of toluene. The detailed pricing structure is not available.
ENVIRONMENTAL AND HEALTH EFFECTS OF ADDITIVES

Background The RMIT Study presented an analysis of the toxicity of petrol additives and emission products (Study 5 of RMIT 1994). This reported extensively on the toxicity of the pure materials as known at the time18. A generalised conclusion of the earlier study would say that the additives were less toxic than the products (ie. petrol, which contains benzene). However, it must be emphasised that this generalisation may not be correct because it ignores synergism between the petrol constituents and the additives. This may result in a product of higher toxicity. Nevertheless, it would appear to be a useful hypothesis pending toxicity data on additive/petrol mixtures. We have reviewed the literature from 1994 to the present. With the coming of the Internet, and the widespread interest in environmental pollutants, there is a mass of information available. We have found no information that would significantly alter the 1994 conclusions about the health and environmental effects of the additives, other than with respect to water pollution by MTBE which is discussed below. One web based organisation Environmental Defense Fund (EDF) produces a database which collates all of the information of chemicals as available from the various US government agencies and other reliable sources. The data is extensively referenced. The product is called Scorecard and is available @ www.scorecard.org [Downloads are presented as EXHIBIT 9]. This site seems to have semi-official sanction with links to it from government sites such as the EPA site19 and private organisations such as the American Methanol Institute. However, it should be noted that this private organisation does not appear to be subject to independent assessment such as scientific peer review20 Scorecard data is used to overview the information on the toxicity of the octane enhancers. Scorecard profiles on the chemicals of interest are presented [EXHIBIT 10]. Another useful data source is Spectrum Laboratories Inc (@ www.speclab.com) which is a private analytical laboratory concerned with analysis air and water. The site contains useful data tables on a range of chemicals found in air and water pollution studies. Possibly the greatest concern to the general public is their exposure to carcinogens. The most comprehensive list available appears to be the list compiled by the State of California
18
Since 1994 there has been further work reported on the principal octane boosters. Further, this Report details other compounds, which were not subject to the 1994 review. Updating the earlier work to cover all published papers on the compounds of interest was considered beyond the scope of this review. 19 Web address: http://www.epa.gov 20 Another site which is widely regarded is the International Program on Chemical Safety: http://www.who.int/pcs/pubs/
Environment Protection Agency [EXHIBIT 11]. The only pertinent compound on this list is benzene. Another major concern is reproductive toxicity [also included in EXHIBIT 11]. On this list is benzene and toluene. However, as a cautionary note on the interpretation of these lists, this list also contains Aspirin and Ethyl Alcohol (in beverages).
Hazard Classification (NOHSC) The National Occupational Health and Safety Commission (NOHSC) classify the hazardous nature of materials. The NOHSC (Worksafe Australia) exposure standards are also available for some of the additives. Ethanol, MTBE, TAME, ETBE, ETAE, Ferrocene have no OHSC classification [NOHSC].
NICNAS and AICS In Australia, the Commonwealth Department of Employment, Workplace Relations and Small Business oversees the National Industrial Chemical Notification and Assessment Scheme (NICNAS). NICNAS was established in 1990 under the Industrial Chemicals (Notification and Assessment) Act 1989 to aid in the protection of people at work, the public and the environment from the harmful effects of industrial chemicals by assessing the risks associated with these chemicals. Searching of the NICNAS database can be performed by CAS number. Although there is some overlap with the Scorecard data, there are some differences and pieces of additional information. The Australian Inventory of Chemical Substances (AICS) lists the substances that that do not require notification as new chemicals to NICNAS. NICNAS data on the chemicals is given in EXHIBIT 16. Methanol (CAS 67-56-1) NOHSC Physico-chemical: F (Flammable); Risk: R11 (Highly Flammable) Health: T (Toxic); Risk: R23/25 (Toxic by inhalation and if swallowed); Safety: 1/2 (Keep locked up and out of the reach of children), 7 (Keep container tightly closed),16 (Keep away from sources of ignition), 24 (Avoid contact with skin), 45 (In case of accident or if you feel unwell, seek medical advice immediately). Cut-Offs: Concentration ! 20%; T (Toxic); Risk: R23/25 (Toxic by inhalation and if swallowed) Concentration < 20% and ! 3%; Xn (Harmful); Risk: R20/22 (Harmful by inhalation) Environmental: Risk phrases not assigned. TWA: 200 ppm or 262 mg/m3
STEL: 250 ppm or 328 mg/m3 Carcinogen category: not categorised Comment: Absorption through the skin may be a significant source of exposure NICNAS The chemical is on the AICS. No other information is held. Human Hazards - Scorecard Scorecard reports the: Inhalation cancer risk Inhalation risk value US air quality standard Ingestion cancer risk Ingestion risk US water quality standard not recognised 10,000 (ug/m3) not covered not recognised 0.5 mg/kg/day not covered
Scorecard reports no recognised health hazard. Scorecard reports methanol is suspected as being a: Developmental Toxicant Gastrointestinal or Liver Toxicant Neurotoxicant Respiratory Toxicant Skin or Sense Organ Toxicant The Fate of Methanol in the Environment Because of blending problems with gasoline, methanol is unlikely to be a preferred additive to gasoline in Australia. Nevertheless, this alcohol is used as an alternative fuel and additive in California. Further there is a considerable trade and industry in methanol and methanol derivatives and the toxicity and environmental fate is of interest to a range of organisations. The American Methanol Institute, which actively promotes the use of methanol as an alternative fuel, has commissioned a major analysis of the fate of methanol in the environment [EXHIBIT 8]. This reports that the half-life for methanol in soil, surface water and ground water is 1 to 7 days and the half-life in air is between 3 and 30 days. Because methanol and ethanol compete in the US market as alternative fuels, some of the data presented concerns the comparison of methanol, ethanol and benzene in the environment (eg comparison of rate constants for anaerobic and aerobic degradation, Table 3-2 of EXHIBIT 8). This data has been subsequently used in information relating to ethanols environmental fate presented to the Blue Ribbon Panel on MTBE (see below).
Ethanol (CAS 64-17-5) NICNAS The chemical is on the AICS. An article concerning a request by the Governor of Illinios to the US EPA to delay the implementation of Phase II of the RFG program until the role of ethanol is clarified. Human Hazards - Scorecard Scorecard has no information on risk values for ethanol. Scorecard reports no recognised health hazard. Scorecard reports ethanol is suspected as being a: Carcinogen Cardiovascular or Blood Toxicant Developmental Toxicant Endocrine Toxicant Gastrointestinal or Liver Toxicant Neurotoxicant Respiratory Toxicant Skin or Sense Organ Toxicant The Fate of Ethanol in the Environment During its deliberations, Kavanaugh and Stocking [EXHIBIT 7] presented the Blue Ribbon Panel (see below MTBE) with data concerning the fate of ethanol as a gasoline additive in the environment. They state that the fate and transport of ethanol in the environment is well understood, but the interaction between ethanol and other gasoline constituents is not clear. Ethanol is miscible with water in contrast to ether additives. Although ethanol has a low vapour pressure in the pure state (lower than MTBE) it shows marked deviations from ideal behaviour and has a much higher effective vapour pressure when used in gasoline blends (RVP 18 psi compared to MTBE 8 psi; see above blending study results; page 27). This gives ethanol a greater tendency to volatilise from gasoline. By contrast Ethanols very low Henrys Law Constant means that evaporation from surface water and off-gassing from ground water is unlikely. This is in contrast to other additives and components of gasoline. The rate of migration in groundwater is indicated by the octanol/water partition coefficient. Ethanol is not adsorbed by soil particles and as a consequence will move at similar speeds to ground water.
Although at high concentrations ethanol is toxic to microbes, it is expected to biodegrade rapidly in ground waters. Estimates of the order of biodegradability are in the order (approximate half lives are given in parenthesis)21 Ethanol (4.1 days) > Benzene (22 days) > MTBE (>120 days) As ethanol use becomes a more widespread alternative to MTBE, there is now concern in California that water supplies are being contaminated by ethanol from gasoline (Oxy-Fuel News, May 15, 2000). Such a situation may arise in Australia if ethanol is added here without proper management of gasoline storage facilities Co-Solvency and Benzene, Toluene, Ethylbenzene, Xylene (BTEX) Plumes. One of the key issues with ethanol is the co-solvency effect with BTEX. This results in the relatively insoluble BTEX increasing in solubility in groundwater containing ethanol. In other words ethanol mobilises BTEX. A further problem is that bacteria preferentially attack ethanol reducing the biodegradation rate of BTEX. This results in BTEX plumes resulting from gasoline spills extending for much further than would otherwise be predicted (estimates by 25 to 40% or in the order of 30m) from leaking tanks. TBA (CAS 75-65-0) The US NTP reports positive results in carcinogenicity bioassays in animals, however, TBA is not recognised as a human carcinogen. NOHSC Physico-chemical: F (Flammable); Risk: R11 (Highly Flammable) Health: Xn (Harmful); Risk: R20; (Harmful by inhalation) Safety: 2 (Keep out of the reach of children), 9 (Keep container in a well-ventilated place), 16 (Keep away from sources of ignition) Cut-Offs: Concentration ! 25%; Xn (Harmful); Risk: R20 (Harmful by inhalation) Environmental: Risk phrases not assigned. Exposure standards not established NICNAS The chemical is on the AICS. This chemical is on the current list for possible assessment as a priority existing chemical (ie there are some concerns with its use).
21
These were estimated from the graphical data of the first order rate constants for biodegradation in the submission by Kavanaugh to the Blue Ribbon Panel EXHIBIT 7.
Human Health Hazard Scorecard reports the: Inhalation cancer risk Inhalation risk value US air quality standard Ingestion cancer risk Ingestion risk US water quality standard not recognised data gap not covered not recognised 0.1 mg/kg/day not covered
Scorecard reports no recognised health hazard. Scorecard reports TBA is suspected as being a: Development Toxicant Kidney Toxicant Neurotoxicant The Fate of TBA in the Environment TBA is a primary metabolite of MTBE and is also found in commercial MTBE supplies. TBA is infinitely soluble in water (miscible) and difficult to biodegrade [OSTP 1997 and STEFFAN] Other Alcohols IPA (CAS 67-63-0) NOHSC No hazard classification TWA: 400 ppm or 983 mg/m3 STEL: 500 ppm or 1230 mg/m3 Carcinogen category: not categorised NICNAS The chemical is on the AICS. No other information held. Human Hazards - Scorecard Scorecard reports the: Inhalation cancer risk Inhalation risk value US air quality standard Ingestion cancer risk Ingestion risk US water quality standard not recognised 7000 (ug/m3) not covered not recognised data gap not covered
Scorecard reports no recognised health hazard. Scorecard reports isopropanol (IPA) is suspected as being a: Cardiovascular or Blood Toxicant Gastrointestinal or Liver Toxicant Kidney Toxicant Neurotoxicant Respiratory Toxicant Skin or Sense Organ Toxicant The Fate of IPA in the Environment No pertinent data is available. However, as a secondary alcohol, IPA is likely to degrade slower than ethanol (a primary alcohol) but faster than TBA (a tertiary alcohol). n-Propanol (CAS 71-23-8) NOHSC No hazard classification TWA: 200 ppm or 492 mg/m3 STEL: 250 ppm or 614 mg/m3 Carcinogen category: not categorised Comment: Absorption through the skin may be a significant source of exposure NICNAS The chemical is on the AICS. No other information held. Human Hazards - Scorecard Scorecard does not report any risk factors for n-propanol. Scorecard reports no recognised health hazard. Scorecard reports n-propanol (n-propyl alcohol) is suspected as being a: Cardiovascular or Blood Toxicant Gastrointestinal or Liver Toxicant Neurotoxicant Respiratory Toxicant Skin or Sense Organ Toxicant The Fate of n-Propanol in the Environment No pertinent data is available. However, as a linear alcohol, n-propanol is likely to degrade quickly.
n-Butanol (CAS 71-36-3) NOHSC Physico-chemical: Risk: R10 (Flammable) Health: Xn (Harmful); Risk: R20; (Harmful by inhalation) Safety: 2 (Keep out of the reach of children), 16 (Keep away from sources of ignition) Cut-Offs: Concentration ! 25%; Xn (Harmful); Risk: R20 (Harmful by inhalation) Environmental: Risk phrases not assigned. TWA: 50 ppm or 152 mg/m3 STEL: Peak Limitation Carcinogen category: not categorised Comment: Absorption through the skin may be a significant source of exposure NICNAS The chemical is on the AICS. No other information held. Human Hazards - Scorecard Scorecard reports the: Inhalation cancer risk Inhalation risk value US air quality standard Ingestion cancer risk Ingestion risk US water quality standard not recognised data gap not covered not recognised 0.1 mg/kg/day not covered
Scorecard reports no recognised health hazard. Scorecard reports n-butanol is suspected as being a: Cardiovascular or Blood Toxicant Gastrointestinal or Liver Toxicant Respiratory Toxicant Skin or Sense Organ Toxicant The Fate of n-Butanol in the Environment No pertinent data is available. However, as a linear alcohol, n-butanol is likely to degrade quickly. Isobutanol (CAS 78-83-1) NOHSC Physico-chemical: Risk: R10 (Flammable) Health: Xn (Harmful); Risk: R20; (Harmful by inhalation)
Safety: 2 (Keep out of the reach of children), 16 (Keep away from sources of ignition) Cut-Offs: Concentration ! 25%; Xn (Harmful); Risk: R20 (Harmful by inhalation) Environmental: Risk phrases not assigned. TWA: 50 ppm or 152 mg/m3 STEL: Carcinogen category: not categorised NICNAS The chemical is on the AICS. No other information held. Human Hazards - Scorecard Scorecard reports the: Inhalation cancer risk Inhalation risk value US air quality standard Ingestion cancer risk Ingestion risk US water quality standard not recognised data gap not covered not recognised 0.3 mg/kg/day not covered
Scorecard reports no recognised health hazard nor no suspected hazards. The Fate of Isobutanol in the Environment No pertinent data is available. However, as a branched alcohol, isobutanol is likely to degrade slower than ethanol but faster than TBA. Sec-Butanol (CAS 78-92-2) NOHSC Physico-chemical: Risk: R10 (Flammable) Health: Xn (Harmful); Risk: R20; (Harmful by inhalation) Safety: 2 (Keep out of the reach of children), 16 (Keep away from sources of ignition) Cut-Offs: Concentration ! 25%; Xn (Harmful); Risk: R20 (Harmful by inhalation) Environmental: Risk phrases not assigned. TWA: 100 ppm or 303 mg/m3 STEL: Carcinogen category: not categorised NICNAS The chemical is on the AICS. No other information held.
Human Hazards - Scorecard Scorecard reports the: Inhalation cancer risk Inhalation risk value US air quality standard Ingestion cancer risk Ingestion risk US water quality standard not recognised data gap not covered not recognised 0.1 mg/kg/day not covered
Scorecard reports no recognised health hazard. Scorecard reports sec-butanol is suspected as being a: Respiratory Toxicant Skin or Sense Organ Toxicant The Fate of sec-Butanol in the Environment No data is available. However, as a secondary alcohol, sec-butanol is likely to degrade slower than ethanol (a primary alcohol) but faster than TBA (a tertiary alcohol). MTBE (CAS 1634-04-4) NICNAS The chemical is on the AICS. MTBE is on the current candidate list for assessment as a priority existing chemical. Human Hazards - Scorecard Scorecard reports the: Inhalation cancer risk Inhalation risk value US air quality standard Ingestion cancer risk Ingestion risk US water quality standard not recognised 3,000 (ug/m3) not covered not recognised 0.3 mg/kg/day 0.02-0.2 mg/L
Scorecard reports no recognised health hazard. Scorecard reports MTBE is suspected as being a: Carcinogen Developmental Toxicant Gastrointestinal or Liver Toxicant Kidney Toxicant Neurotoxicant Skin or Sense Organ Toxicant
Some stakeholders expressed particular concerns about the potential carcinogenicity of MTBE22 Proposed US MTBE Phase-Out - Blue Ribbon Panel Background: Oxygen in US Gasoline Pool The US Clean Air Act Amendments of 1990 (CAAA) established the Federal Reformulated Gasoline Program (RFG). This was implemented in 1995. The CAAA required RFG to contain 2% oxygen by weight. Because of unique air pollution problems, California adopted similar but more stringent guidelines for Californian RFG (CaRFG). This required 2.7% oxygen in the gasoline. In addition areas in both California and elsewhere which did not meet national air quality requirements had to introduce a wintertime Oxyfuel program which required gasoline to contain 2.7% oxygen by weight. About 30% of gasoline sold in the US is RFG or Oxyfuel. The oxygen in the fuel is provided by: MTBE 76% Ethanol 19% TAME and ETBE 5% The dominant oxygenate in the US is MTBE. Ethanol is mainly used in the corn-belt states of the mid west USA. Ethanol tends to have a high use in winter oxygenated areas where it is used to deliver about 3.5% oxygen to the final gasoline. Groundwater Contamination After the introduction of RFG, MTBE started to be detected in US water supplies. About 5 10% of the water in RFG areas showing contamination. The great majority was below the levels for public health concerns (< 20 parts per billion). However, even at these levels there was concern about odour and taste. The major source of groundwater contamination was from leaking underground gasoline storage tanks, which contaminated local wells. Other sources have been identified including gasoline spills to surface water, pipeline leaks and contamination by recreational watercraft. Blue Ribbon Panel In response to these issues, the EPA (Administrator C. Browner) appointed the Blue Ribbon Panel in November 1998 to investigate air and water quality issues relating to the use of MTBE. The final report was issued in September 1999 [EXHIBIT 4].
22
See The International Program on Chemical Safety (Environmental Health Criteria No. 26).
Page 49 Duncan Seddon & Associates PPtyLtd.
The key pertinent recommendations of the Panel were: that MTBE should be substantially phased out of gasoline in the USA in order to facilitate the phase out, the 2% limit on oxygenate level in RFG should be waived.
There were two dissenting opinions on this issue: Todd Sneller [Nebraska Ethanol Board, EXHIBIT 5] stated that the CAAA intended that reducing aromatics in gasoline would attain air quality improvements. The removal of the oxygen waiver for RFG would result in an increased use of aromatics. This would degrade air quality. Lyondell Chemical Company23 [ EXHIBIT 6] stated that the removal of MTBE was unwarranted because no public health issue has been identified. The problem with groundwater contamination had been effectively dealt with by the introduction of new storage tank regulations in 1998. Further, the analysis used by the Panel to support the view that air quality would be maintained was flawed and air degradation would result. The Blue Ribbon Panel held several meetings and took many formal submissions24. The following summarises salient findings of the Panel: Water Contamination The result of using MTBE in RFG was an increase in detection of the additive in drinking water. Between 5 and 10% of drinking water in high oxygenate areas was contaminated. The great majority was well below the level of concern, many near the detection limit. About 0.3 to 1.5% of analyses showed value of MTBE above 20 ppb. One study [GRADY] showed that MTBE contamination was found principally in RFG areas25. Several studies noted that MTBE was associated with detection of volatile organic (VOC) compounds but not benzene, toluene, ethylbenzene and xylenes (BTEX) [GRADY, SQUILLACE]. Sources of contamination were identified as releases from underground gasoline storage tanks, pipelines, spills, improper disposal, and surface water contamination from storm water run-off and watercraft. Fate of MTBE in the Environment Relative to other components of gasoline, MTBE is more soluble in groundwater, is adsorbed less readily on soil particles and biodegrades less rapidly. In groundwater it moves more quickly than other components [HAPPEL, SALANITRO].
Lyondell are a major supplier of MTBE. These are available on the US EPA web site, follow the links to the Blue Ribbon Panel. 25 Interestingly there was some detected in non RFG areas but this could be from the widespread use of MTBE at a lower level than that required for RFG.
24
23
Air Quality Benefits The efficacy of the RFG Program has been extensively studied. The most comprehensive data used by the Blue Ribbon Panel was a report conducted by the Office of Science and Technology [OSTP June 1997]. In Phase 1 of the program the achievements of the program have been better than anticipated by the regulations. Indeed in some instances, better quality has been achieved than that anticipated in Phase 2 of the program which started January 2000. This observation is important because it permits the deduction that MTBE could be removed and the compliance with CAAA still achieved. However, it was recognised that removal of oxygenates may cause some problems and other issues (eg CaRFG where there is also a low cap on the aromatics level). Carbon Monoxide The Panel recognised that if oxygenates are removed from fuel there would be expected to be an increase in the level of CO emissions. However, the turnover of the vehicle fleet with stricter compliance of tail pipe emissions (due to lean burning and catalyst changes) would largely mitigate this effect. From the Australian perspective, we have to acknowledge the relative large age of the Australian vehicle fleet with significant number of vehicles without any form of emission control. We may deduce that increasing olefines and aromatics in the fuel will result in air quality deterioration especially in the large urban centres. TAME and Other Ethers NICNAS DIPE is on the AICS. No other information held. TAME, ETBE and ETAE are NOT on the AICS. No information held There is no data in Scorecard on TAME or ETBE. DIPE is reported as a suspected neurotoxicant. Other ethers are likely to be similar, although not identical to MTBE, ie is highly soluble in water, is poorly adsorbed by soil and have low biodegradation rates.
Comparison to BTEX and Alkylate NICNAS Benzene is on the AICS and is under assessment as a priority existing chemical. Toluene and xylenes are on the AICS and are on the candidate as a priority existing chemicals. Butane and isooctane are on the AICS, no other information is held Behaviour in Water Aromatics (BETX) from the standpoint of hydrocarbons are relatively soluble in water. The saturation level is in the order of 1000 - 3000 ppm. Aromatics are readily biodegradable. Alkylate (as exemplified by isooctane) is very much less soluble in water than aromatics. The saturation level is typically 50 ppm. Comparative Data Data showing the relative potential of the various additives to contaminate potable water and ground water is presented in Table 12:
TABLE 12a COMPARATIVE DATA Contamination Potential of Potable Water26

BENZEN E MTBE
ETHANOL
ETBE
TAME
TBA MISC.
ISOOCT.
Solubility in Water (g/100g H2O) Sol. from gasoline (g/100g H2O) Taste in Water (ug/L) Odour (ppm)
0.0178 <0.01 500 0.5
4.8 0.55 20-40 0.053
MISCIBLE
1.2 0.33 47 0.013
1.2 0.24 128 0.027
<<0.01 -
5.7 49
2.5 21
TABLE 12b
Contamination Potential of Groundwater

Solubility (mg/L) Vap. Pres. mmHg Henrys law Log Koc
Importance in
Methanol Ethanol
TBA MTBE ETBE TAME DIPE
Benzene Toluene Xylenes
rate of migration evaporation bioavailability from spills soil vapour extraction infinite 130 infinite 50 infinite 40 50000 245 19000 180 16000 80 4500 170 2000 95 540 28 180 8
evaporation from water 0.0001

0.000252
rate of migration soil absorption 0.7 0.7 1.6 1.15 1.6 1.7 1.6 1.8 1.8 2.5
0.0005 0.02 0.1 0.055 0.4 0.22 0.2 0.3
The data in the first table (Table 12a) indicates that although MTBE is not the most soluble, nor has the strongest odour, it can be detected in water by taste at extremely low levels. The second table of data (Table 12b) complements the first. The first column indicates that alcohols are miscible with water and the ethers are quite soluble in water. Gasoline components are relatively insoluble. The second column (vapour pressure) shows that the ethers and methanol are the most likely components to evaporate from spills. The third column gives Henrys Law constants. Components with values <0.05 are unlikely to evaporate from surface water (alcohols, MTBE, TAME).
26
Blue Ribbon Panel report EXHIBIT 4

The values for the octanol/water partition coefficient are shown in column four. The octanol/water partition coefficient (Koc) gives and indication of how strongly (or weakly) a water contaminant is held by soil particles. A relatively low Koc indicates a lower attraction to the soil. As the Koc value falls towards unity, the contaminant moves at the speed of ground water. Ferrocene (CAS 102-54-5) Ferrocene is on the AICS list. Scorecard reports no recognised health hazard. Scorecard reports ferrocene is suspected as being a: Endocrine Toxicant Gastrointestinal or Liver Toxicant The Fate of Ferrocene in the Environment Octel has provided exhaust emission toxicological data on vehicles using gasoline containing ferrocene. In none of the studies conducted, could differences in the toxic effects of the exhausts, deriving from fuel without and with 30 ppm ferrocene (Octel recommended maximum dosage), be detected. Particularly in the inhalation studies, using the highest exhaust concentrations technically possible, no toxic effects from the exhaust from engines equipped with 3-way catalysts, could be detected. In another test, no significant differences were found in the regulated emissions of carbon monoxide, hydrocarbons, nitrogen oxides, particulate matter, poly-aromatic hydrocarbons, mutagenic activity and TCDD-receptor activity [EXHIBIT 29]. Iron is widespread in nature and a basic constituent of motor vehicles. Ferrocene emissions from the tailpipe would be as iron oxide. Iron oxide emission would be expected from normal engine wear and ferrocene use at the recommended levels may not add significantly to the total levels of iron emission. MMT (CAS 12108-13-3) Manganese is an essential element for human health and is widespread in nature. Problems occur in as a consequence of high exposure. NOHSC No hazard classification TWA: 0.2 mg/m3 STEL: Carcinogen category: not categorised Comment: Absorption through the skin may be a significant source of exposure
NICNAS NICNAS has formally called for information from industry sources on the use of this chemical in Australia to determine whether it should be assessed as a priority existing chemical. Scorecard reports no recognised health hazard. Scorecard reports MMT is suspected as being a: Neurotoxicant Respiratory Toxicant The Fate of MMT in the Environment MMT has been used in Canadian gasoline since 1976 and MMT and manganese in the Canadian environment has been subject to extensive review [EXHIBIT 20]. MMT was found to be oxidised very quickly in ambient air to manganese oxides and of itself MMT did not pose a risk In this early study, the Canadian workers estimated that up to 40% of the manganese present in the gasoline was emitted from the tailpipe as manganese oxides. However, more recent data indicates that actual emission of manganese from the tailpipe is much lower (12 - 16%) with the manganese being present as the more inert manganese phosphates or silicates [EXHIBIT 25]. For cities in Canada with no major manganese emitting industries, the sampling of urban air, water and dust was taken to represent the impact of MMT in gasoline. The work found that urban air was below the benchmark levels at which no adverse effects were to be expected. The analysis also included infants and the elderly who are more prone to risk by manganese poisoning. There was no correlation between the manganese content of particulate matter and the sales of MMT gasoline. However, there was some association of manganese levels with city size and traffic density. For these cities MMT was found not to be entering the environment at a rate which would cause concern. For cities with manganese emitting industries (eg steel mills) average exposure was above the level at which health problems may have occurred. This was deemed to be unrelated to MMT in gasoline. In Australia there is a major manganese mining operation at Groote Eylandt in the Northern Territory, and major manganese dioxide production plant and steel mills in several cities in Australia.
Gasoline Components The main interest is in the effects of benzene and other aromatics. Most of the additives are compared with benzene and comparative data is included in the above information for MTBE and ethanol. For comparison, the toxicity as reported by Scorecard are: Benzene ((CAS 71-43-2) Human Hazards - Scorecard Scorecard reports the: Inhalation cancer risk Inhalation risk value US air quality standard Ingestion cancer risk Ingestion risk US water quality standard 0.000029 (ug/m3) 60 (ug/m3) not covered 0.1 mg/kg/day data gap 0.005 mg/L
Scorecard reports benzene is a recognised health hazard: Carcinogen Development Toxicant Reproductive Toxicant Scorecard reports benzene is suspected as being a: Cardiovascular or Blood Toxicant Endocrine Toxicant Gastrointestinal or Liver Toxicant Immunotoxicant Neurotoxicant Respiratory Toxicant Skin or Sense Organ Toxicant Toluene (CAS 108-88-3) NICNAS Listed on the NICNAS candidate list for possible assessment as a priority existing chemical. Human Hazards - Scorecard Scorecard reports the: Inhalation cancer risk Inhalation risk value US air quality standard not recognised 400 (ug/m3) not covered
Ingestion cancer risk Ingestion risk US water quality standard
not recognised 0.2 mg/kg/day 1 mg/L
Scorecard reports toluene is a recognised health hazard: Development Toxicant Scorecard reports toluene is suspected as being a: Cardiovascular or Blood Toxicant Gastrointestinal or Liver Toxicant Immunotoxicant Kidney Toxicant Neurotoxicant Reproductive Toxicant Respiratory Toxicant Skin or Sense Organ Toxicant Xylene (Mixed Isomers) (CAS 1330-20-7) NICNAS Listed on the NICNAS candidate list for possible assessment as a priority existing chemical. Human Hazards - Scorecard Scorecard reports the: Inhalation cancer risk Inhalation risk value US air quality standard Ingestion cancer risk Ingestion risk US water quality standard not recognised 700 (ug/m3) not covered not covered 2 mg/kg/day 10 mg/L
Scorecard reports xylenes are not a recognised health hazard: Scorecard reports xylene is suspected as being a: Cardiovascular or Blood Toxicant Development Toxicant Gastrointestinal or Liver Toxicant Immunotoxicant Neurotoxicant Reproductive Toxicant Respiratory Toxicant Skin or Sense Organ Toxicant
Other Components Scorecard reports butane (CAS 106-97-8) as a suspected neurotoxicant Isooctane (CAS 540-84-1) is reported as a suspected: Gastrointestinal or Liver Toxicant Kidney Toxicant Respiratory Toxicant Skin or Sense Organ Toxicant
IMPEDIMENTS OF HARMONIZATION WITH EUROPEAN UNION QUALITY STANDARDS

Overview The Fuel Quality Review [COFFEY] sets out the approach to improve emissions from Australian vehicles. This involves the regulations concerning the construction of vehicle engines. However, if such vehicles are to achieve the envisaged improved performance, there has to be concomitant improvement in the quality of the fuel. Since the improved engine designs emanate from Europe it would be natural for Australia to harmonise with European fuel quality standards, specifically Euro-3 and Euro-4 fuels. This report addresses this issue from the standpoint of spark ignition engines (gasoline) and reports on the substantive issue of lifting the octane value of the gasoline pool from the current value of about 92 to 95 RON. The World-Wide Fuel Charter (WWFC) promotes the harmonisation of fuels from the standpoint of the vehicle manufacturers of USA, Japan and Europe. The WWFC has recently been revised [EXHIBIT 23]. Whilst there is a lot of common ground between the Euro-3 and Euro-4 specifications, there are some subtle differences which may impact on the use of octane boosters. As well as 95 RON, the WWFC gives specifications for a 98-octane fuel. Fuel of 98 RON has not been the primary consideration of this Study. The WWFC represents the considered opinion of the auto-manufacturers and is used by the local industry in Australia to define the optimum fuels from their standpoint. TABLE 13 THE PRESENT POOL AND THE TARGET27 RON
MON
Sulphur (ppm. max.) Benzene (% max.) Aromatics (%) Olefins (%) RVP (kPa, min.) Oxygen (% max.)
ULP (1998) 91.6 82.5 150 2.6 27.5 17.1 71 ~0
Euro-3 95 85 150 1 42 18 60 2.7
Euro-4 95 85 50 1 35 14 55 2.7
WWFC-3 95 85 30 1 35 10 45 - 60 2.7
The data in Table 13 (above) illustrates that the 1997 pool average more or less met Euro-3 standards with respect to sulphur, aromatics, olefins, but fell short of the standards with respect to octane (RON and MON), benzene and RVP.
27
From page 51 of draft Setting National Fuel Quality Standards - Paper 2 and Fuel Quality Report, Table 5-1
Note that although no minimum oxygen level is stipulated, the maximum oxygen content is 2.7%. The WWFC specifies that ethers are preferred oxygenates. Where ethanol is used >C2 alcohols are limited to 0.1% and methanol is not permitted. The Charter specifically excludes manganese additives. Australia has eight major refineries producing about 18,300 million litres per year [AIP]. The bulk of the petrol is made to approximately the above composition (Table 13) for the unleaded grade and (after addition of lead) leaded petrol grades. Unlike the large European, Singapore and US operations, the Australian refineries are largely stand-alone operations and there is very limited ability to transfer intermediates between refineries. This means the refineries are producing specification product within the boundaries of the refinery and places them at a cost disadvantage relative to the larger integrated operations. The preferred option of the refiners is to continue this practice and to produce the specification fuels without resorting to import of additives or boosters. There are three ways to boost octane28: 1. Isomerisation Isomerisation will improve the octane value of the lighter hydrocarbons (C5 and C6), commonly referred to as light straight run gasoline (LSR). LSR can have low octane eg 70 RON. However, isomerisation is limited to achieving a product of about 90 RON. Nevertheless, this may be sufficient to get the finished gasoline to the target value. Isomerisation product contains no olefines, benzene, aromatics and little if any sulphur and so contributes well to all of the other criteria. Isomerisation is costly and to achieve the higher octane (multiple pass operation) results in feedstock losses - this ultimately results in increased greenhouse emissions. Isomerisation is practiced at the Caltex refineries at Lytton and Kurnell, BP Kwinana, Mobil Port Stanvac, Shell Geelong 2. Alkylation Alkylation involves the reaction of light olefines (propylene and butylenes with isobutane to produce highly branched paraffins. If isobutene is used, the product is isooctane with RON and MON values of 100. If mixed olefines are used, the octane is typically about 95. Alkylate is highly sought after by refiners because of its high octane (both RON and MON) and no sulphur, aromatics or olefines. Most of the alkylate is used within refineries, but there
28
The construction of a finished gasoline is quite complex and this is a simplified view, which tries to get to the essence of the problem. I have omitted fluid cat-cracking (FCC) which produces a very large volume of gasoline blend stock rich in olefins with a final octane of about 92 RON. As well as olefins, FCC also produces some aromatics. It is assumed that FCC operation is limited by the maximum olefin content of the finished gasoline and this limits the refinerys ability to increase FCC output. However, inspection of the table shows there is some flexibility to do this for Euro-3 but not for Euro-4 fuels.
is a small trade. As discussed above (under financial cost of additives), alkylate may become a target product for US refiners wishing to eliminate MTBE. All the refineries, which can produce and separate light olefines and isobutane, have an alkylate producing facility. Only the Mobil refinery at Port Stanvac has no alkylation facility. There are two types of alkylation process, one based on sulphuric acid and the other on hydrofluoric acid. Both have their proponents and opponents and both have environmental waste problems. 3. Reforming Reforming produces aromatics from saturated hydrocarbons with six or more carbon atoms. The feed stock is heavy naphtha with an octane of about 40 - 50 RON and the product is called reformate with a RON of 98 or more. Reforming is thus the powerhouse of octane boosting within the refinery. All major fuels refineries have a reformer. Reforming produces BTX as the principal products. High severity reforming which gives reformate >100 RON is usually only practiced by operations integrated into petrochemicals where benzene is a desired product. Most refinery reformers operate at much lower severity. Selecting the feed stock to avoid benzene (C6) precursors can reduce benzene content. The reforming of hydrocarbons to produce aromatics is energy intensive and the increased use of reforming or more severe reforming to increase aromatics inevitably leads to higher greenhouse gas emissions. Since the ability to use isomerisation and alkylation is limited, Australian refiners would rely on increasing the use of reforming to lift octane to the target levels. As a rule of thumb, a one number octane lift is achieved by a 2% rise in the level of aromatics. Using this rule, we see that the present pool octane could be lifted to 95 RON by an increase in 6% in the aromatics. Very roughly this would mean that the gasoline pool would be about 34% aromatics. This is lower than the Euro-3 standard. We thus conclude that: Euro-3 95 Octane fuel can be achieved by increasing the level of aromatics. However, we also note that this would produce a pool gasoline that would approach the Euro4 and WWFC - 3 limit for aromatics29. For these standards additional process plant increased isomerisation or alkylation capacity would probably be required or the refiners would have to use of an octane booster. An octane booster may be required to achieve Euro-4 standards. Differences in process plant available, and hence base stock gasoline of varying quality, at the different refineries in Australia raises the prospect that there is unlikely to be a universally acceptable octane booster. In other words what might be necessary in one particular refinery may not be required at others.
29
Note the aromatics level of PULP in 1998 was reported as 35.7%, ie higher than Euro-4
Different octane boosters may be required at the different refineries The problem of minimising aromatics is exacerbated when one considers the possibility of 98-octane fuel being widely introduced. Environmental Impact of Increased Aromatics in Gasoline Pool There is a substantial body of data (and opinion still being debated in the USA) that increased aromatics in the gasoline pool leads to a degradation of air quality. This problem would be of particular relevance to the larger urban centres in Australia. Increased aromatics would not result in increased emissions from the new vehicle fleet built to the design regulations for which the new fuel standards are designed. Such vehicles are to be equipped with the latest lean-burn and catalytic conversion technology that will substantially eliminate all of the pollutants. Rather, increased air pollution will arise from: fugitive emissions in the delivery chain form the refinery to the petrol tank emissions from vehicles not designed to the new standards
Of these the latter is probably more important because one of the distinguishing features of the Australian automotive fleet when compared to the European and USA fleets is the number of older (> 10 years) vehicles. Increased aromatics in the gasoline pool may result in increased air pollution from the older vehicle fleet. As a consequence this may force the use of octane boosters to achieve the Euro-3 standard before the introduction of Euro-4. Because of higher traffic densities, pressure to control aromatics may particularly apply to Melbourne and Sydney first, with the prospect that refineries supplying these markets will be the first to use additive octane boosters. Issues Octane and Greenhouse Today there is a considerable amount of interest in the reduction of greenhouse gases with most emphasis being placed on the principal greenhouse gas, carbon dioxide. For our consideration, greenhouse gases in the transport sector arise from two sources: 1. 2. At the refinery by converting crude oil into transport fuels, and In the vehicle
Vehicle emissions are directly linked to the engine efficiency (km/litre). The engine efficiency is related to the compression ratio - the higher the compression ratio the better the efficiency. Higher compression ratio vehicles require higher-octane fuel. This is the position under which the automotive manufacturers are working to achieve their commitments to government to improve efficiency.
From the standpoint of the refiners we have the opposite. On the basis of thermodynamics, transport fuel is higher in energy30 than crude oil, and the more refined the transport fuel (essentially higher the octane), the bigger the energy difference. This means that to convert crude oil into higher octane gasoline requires more energy. Unfortunately, there is also a mismatch in the carbon-hydrogen content of crude oil when compared to gasoline. Crude oil contains more carbon than gasoline and the more refined the gasoline the less carbon it contains31. Refinery operations achieve this balance by rejecting carbon as carbon dioxide. This issue is particularly pertinent when producing higher-octane gasoline (98 RON). Such a fuel would produce improved vehicle engine efficiencies but at the considerable cost of carbon dioxide emissions in the refineries. There is obviously an optimum, but to our knowledge there has been no attempt to determine that optimum. We do not know if increasing octane will result in a net (global) improvement or increase in greenhouse gas emissions. Greenhouse (2) In addition to the above we note the potential use of oxygenates and MMT to lower the Australian quantum of greenhouse emissions. This is because the oxygenates would be produced in non Kyoto signatories or from biomass. MMT reduces vehicle emissions as well as allowing refiners to operate at lower intensity and hence save energy. Variance within Standards The Euro-3 and WWFC - 3 fuels attempt to define world fuels, so that for example, the same car will perform in the same manner wherever the fuel is available. However, inspection of these fuels standards reveals that there is permitted quite a large variation in composition. For instance, on the one hand, a fuel could comprise entirely hydrocarbons and on the other could contain MTBE or ethanol (set by the maximum oxygen level of 2.7%) or MMT. Even within the hydrocarbons there is some permitted variation. This is because the density is permitted to range over a relatively large value. For example WWFC - Category 3, the permitted range of density is 715 - 770 kg/m3. This should be compared to the density values of isooctane (692 kg/m3) and toluene (867 kg/m3). This illustrates that fuels can be prepared by mixing aliphatic hydrocarbons and aromatics in varying proportions. As an aside we should note that a gasoline comprising substantially the use of alkylate (isooctane), which many regard as the best gasoline blendstock, would not be permitted under WWFC-3 (and possibly Euro-3), because the density would be too low.
30 31
Free energy H/C ratio for crude oil typically <1.5; for isooctane H/C ratio >2.
The consequence of this is in terms of the energy efficiency as measured in terms of km/L of fuel32. Lower density fuels translates into a lower energy density and hence lower km/L. One way to assist this problem would be to move to standards of fuel efficiency based on km/kg of fuel. Another consequence is that for large geographically spread areas served by a multitude of gasoline sources (refineries and import in the case of Australia) there is unlikely to be one national fuel without considerable further tightening of the standards. This argument equally applies to Europe. The author believes it highly unlikely that the gasoline sold to Euro-3 and Euro-4 standards will have the same composition across Europe in terms of some of the key components such as MTBE content and the ratio between aliphatic and aromatic hydrocarbons. MTBE Bans and Phase Out - Shooting the Messenger The present concern with MTBE stems from the contamination of ground water. The principal culprit is leaking underground gasoline storage tanks near to wells and ground potable water supplies. MTBE can be tasted in water at the parts per billion level and test methods have been developed to detect MTBE at this extremely low level. At these levels there has been no suggestion of human health problems. Whilst we can sympathise with water authorities relying on the supply of water from underground aquifers, banning MTBE may be too severe a reaction. Since MTBE does not occur naturally, the detection of MTBE in ground water near to gasoline storage tanks clearly indicates that there is a serious problem of leaking fuel. Banning MTBE from the gasoline does not stop the root cause of the problem - leaking tanks. Banning MTBE implies that the regulation, inspection and maintenance of underground storage tanks are deficient. Further, it should be realised that other materials are likely to be detected from leaking tanks (eg ethanol, which brings with the likelihood of increased benzene and aromatics33). Are these other additives to be banned? The controversy surrounding MTBE has sparked further research into its possible carcinogenicity. Again there is much on-going debate. However, we should remember that we are discussing an additive to petrol which itself comprises many highly toxic materials.
The vehicle manufacturers determine mileage by a process proscribed in ADR 79/00 Emission Control for Light Vehicles. This process calls for a specific fuel, which is much more tightly defined from the standpoint of density (0.741 to 0.755 kg/L). 33 Indeed, as ethanol use becomes a more widespread alternative to MTBE, there is now concern in California that water supplies are being contaminated by ethanol from gasoline Oxy-Fuel News, May 15, 2000. Such a situation may arise in Australia if ethanol is added here without proper management of gasoline storage facilities.
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Ethanol in Gasoline The use of ethanol in gasoline has a long history in Australia and is practiced by several groups. The normal practice is to use 10% ethanol as an extender to the gasoline with the particular aim of producing premium unleaded fuel (ie 95 RON). At 10% ethanol this fuel will not meet the European standards with respect to RVP and oxygen content. We have presented data to show that blending ethanol into gasoline at levels commensurate with the Euro-3 oxygen limit (< 7.8%) will result in difficulties in meeting the proposed lower RVP requirements (60 kPa falling to 55 kPa for Euro-4). Prima facie the use of ethanol is not compatible with the proposed Euro-3 and Euro-4 standards. Nevertheless, we have to recognise that there is a considerable amount of social pressure to use ethanol in the gasoline pool. For this role the standards with respect to RVP may have to be eased. Unfortunately, this will produce internal contradictions within the standards, specifically with regard to the final RVP and the reason for capping RVP. This arises because RVP is capped to improve air quality in the summer months, but ethanol is known to exacerbate this problem and presumably would not be subject to the new RVP cap. Ethanol - Familiarity Breeds Contempt Australia has a long history of the use of ethanol in transport fuel. This has generally been in controlled demonstration programs and in relatively small areas. For this use no excise is applied to the ethanol component (equivalent to about 45-c/L subsidy). Unfortunately, Australia has a long history of ethanol abuse. As beverage alcohol, ethanol attracts an excise of about $35/L. There have been proposals to increase the excise to lower ethanol consumption. Whilst there is no evidence of fuel ethanol being illegally used as hooch, we must be aware of the possibility, especially if the use of ethanol becomes more widespread. As we have discussed above, ethanol is relatively easily extracted form gasoline by contacting the gasoline with water. Unfortunately, there are also many recipes for removing hydrocarbon contaminants from aqueous ethanol34. The attraction for removing ethanol from gasoline for illegal use is exacerbated by the enormous tax differential35. If the use of fuel ethanol in gasoline increases then the potential for an illegal industry should be addressed. One option might be in incorporate addition higher alcohols in the blend that would serve to contaminate any ethanol that was illegally extracted. We note that this may not be acceptable to the WWFC-3 standard which limits higher alcohols to 0.1%.
In the USSR industrial ethanol was contaminated with benzene, with which it forms an azeotrope so cannot be separated by distillation. There were several recipes for removing the benzene to make hooch. 35 60L of gasoline (a tank full) at 10% by volume would contain $210 worth of ethanol valued as beverage alcohol.
34
MMT - To Be or Not To Be Although MMT is not permitted under WWFC-3 rules, we note that the Charter proponents are intending to produce a position paper in the next few months. However, MMT is gaining widespread acceptance from the refining side of the industry, especially for formulating lead replacement petrol. We have noted that because of the relatively high aromatics levels present in Australian gasoline basestock, MMT may only contribute a minor value to the octane. Nevertheless, MMT may be important in allowing refiners to trim the final gasoline to ensure a minimum 95 RON. For this end MMT may be used in lower than the normal dosage of 18 mgMn/L. Further, we note that MMT can be used beneficially with oxygenate octane boosters (ie. both contribute to octane). This may allow optimisation from several standpoints by using a mix of additives such as MTBE, ethanol and MMT.
STAKEHOLDER INPUTS
The following are summaries of views expressed to us during the course of the Study. Motoring Organisations Correspondence for various motoring organisations is presented in EXHIBIT 15. Australian Historic Motoring Federation Inc. and Australian Automobile Association The AHMFI and AAA expressed the view that forecourt additives that increase octane must be mandated to the relevant Australian Standard and that only such products should be allowed to be marketed and distributed in Australia. From the standpoint of this Study, I assume that in essence this means that by addition of the additive to the fuel by the motorist would not result in the fuel (in the tank) departing from the fuel standard. NRMA MTBE is not supported because of its impact on groundwater. MMT - not supported because its use is still controversial on a range of issues. No objection to ethanol/methanol up to 10% but must not be subsidised. Other compounds must be shown to be beneficial without excessive environmental degradation and able to be produced at a competitive cost. Australian Institute of Petroleum The following are meeting notes. Draft notes and further commentary from participants are given in EXHIBIT 15. MEETING REPORT MAY 10TH. 2000 @ BP AUSTRALIA; 360 ELIZABETH STREET, MELBOURNE PRESENT: Ewan Macpherson, Australian Institute of Petroleum Natalie Smirk, BP Frank Russell, BP Geoff Davis, Mobil Australia Adrian Moore, Caltex Australia Limited Greg Engeler, Caltex Australia Limited Leon Haliburton, Shell Australia John Harris, Shell Australia John Harris, RMIT Duncan Seddon
TOPIC: Octane Boosters The objective was to ascertain the current industry views with regard to octane boosters. The consensus was as follows: Australian refiners would want to have the greatest flexibility possible in their endeavours to improve fuel quality standards and to boost octane. All the majors have had considerable experience in the use of MTBE in USA (where it is added for air quality reasons), Europe and the Far East (where it is added for octane enhancement), but all were of the view that they did not want to expand this usage and hence did not favour the use of this additive in Australia. There was a similar position on TAME and ETBE. Concern was expressed that the Euro-3 standards were developed within a framework of the widespread use of MTBE (about 10%) and that removal of MTBE may cause problems in achieving this standard in Europe. None would want to see the introduction of a 98 or 100 octane grade which would be available at all outlets, although no problems with such high octane grades being available at specialist outlets. Increased octane would generally be achieved by increasing the severity of reforming, ie. increase in the level of aromatics. The addition of oxygenates was an option, but not the preferred route. As a rule of thumb an increase in 1 octane was equivalent to an increased in aromatics of 2%. An ideal refinery could achieve 95 octane by a combination of isomerisation, alkylation and reforming. However, there was insufficient isomerisation and alkylation capacity in Australian refineries. This left the local industry to rely on reforming by increasing the aromatics level. Achieving low benzene levels would require some changes to reformer operation or benzene extraction. The cost of octane was in the order of US$ 50 cents/octane barrel. All agreed that methanol would not be used because of safety, blending and corrosion issues. Ethanol was the most acceptable oxygenate. However, there were major problems: MON is an issue because ethanol does not lift MON very much; the use of ethanol would give rise to problems in meeting summer vapour pressure specifications; cost is a problem as ethanol is only economic because of its excise free status, and in low cost crude environments ethanol could be uncompetitive. Although TBA and IPA was in use in Japan, there was no enthusiasm for using these additives. The lack of infrastructure was a particular problem. In reaching the new specifications with regard to vapour pressure, this caused the refineries to back out butane. The choices for the refinery for using the displaced butane were LPG, which is opposed by some groups, internal use as fuel gas or flaring. The ferrocene additive being marketed by Associated Octel would not be used. There was interest in the use of MMT and all the majors had experienced its use in Canada and elsewhere. However, most of the local refiners would not use this additive in unleaded petrol unless the vehicle manufacturers sanctioned its use. However, for most refiners this did not apply to the addition of MMT in Lead Replacement Petrol (Caltex, Shell, Mobil). It was noted that lubricating oil and other fuel additive packages all contained metals. If an additive had to be added, there may be issues with the import and tankage of the additives.
Blending up gasoline from variously imported base stocks might result in drive-ability index problems which was not the case for refinery produced product.
Federal Chamber of Automotive Industries The following meeting report notes the attitude of the local vehicle manufacturers towards octane enhancers. MEETING REPORT MAY 17TH. 2000 @ TOYOTA ENGINEERING CENTRE, 61 BERTIE STREET, PORT MELBOURNE PRESENT: Rex Scholar, FCAI Keith Marsh, Mitsubishi M. Preston, BMW M. Frankie, Holden S. McDonald, Ford P. Stirling, Holden P. Chear, Nissan J. Lindsay, Rover M. Morarty, Toyota John Harris, RMIT Duncan Seddon TOPIC: Octane Boosters The objective was to ascertain the current industry views with regard to octane boosters. The consensus was as follows: Australian motor vehicle manufacturers are generally technology takers from the standpoint of engine development. This means that engine performance standards are generally determined by the overseas affiliates. This means that for fuel standards, the local industry takes the lead and opinions from those expressed by internationally agreed procedures. Specifically, the approach to fuel standards is taken from the World-Wide Fuel Charter (WWFC) developed by The European Automobile Manufacturers Association, Alliance of Automobile Manufacturers, Engine Manufacturers Association, and Japan Automobile Manufacturers Association. The latest version (April 2000) states the latest industry view on aromatics, volatility, MMT and oxygenates. Auto Industry is strongly opposed to MMT and is pessimistic re. use of metal additives from the point of view of possible engine/emission control components contamination and likely environmental objections. Oxygenates could be tolerated, but offer no direct benefit to the vehicle operator - they are fuel diluents, rather than extenders and result in poorer fuel consumption. Local
experience indicates that E10 (10% ethanol) could be tolerated. Ethanol in high concentrations (>20%) had a detrimental effect on paint and finishes of some vehicles. In discussion, it was realised that the WWFC fuels standards permitted a significant variation in fuel composition. This meant fuels may or may not contain oxygenates, allow density to vary over a wide range (hence vary in the relative amounts of aliphatics (low density) to aromatics (high-density) components). It was not immediately apparent what this permitted variation would have on the agreed vehicle performance standards. DS expressed the opinion that the variance in WWFC standards would permit variations in gasoline composition in Europe and Australia, ie there will not be a common fuel of the same composition in apparently homogeneous, but large geographically spread, markets. This impact of this on the industry was not clear.
RECOMMENDATIONS
The principal objective of fuel harmonisation is to harmonise Australian fuel standards with European Standards Euro-3 and Euro-4. This requires a minimum octane value of 95 RON. Although this can be achieved using conventional fuels the European standards allow for the use of oxygenate octane boosters to a level of 2.7% by weight oxygen. In Europe the preferred oxygenate is MTBE. MTBE is extensively used in the USA in the reformulated gasoline program. RFG is used in 30% of all gasoline sold in the USA. US RFG has a lower octane level than the European Standards. The continued use of MTBE in gasoline is currently under considerable debate and the US Executive is proposing MTBE phase out. The costs and practicality of MTBE phase out is being studied extensively and is the subject of ongoing debate. It is not clear if the US can maintain the benefits of the Clean Air Act without oxygenates. The cost of changing to new standards in Europe has been analysed [CONCAWE 99/56]. This analysis explicitly assumes the use of 2.7 million tonnes of MTBE in the European gasoline pool in 2010, mainly in Germany, France, Italy and Greece. It is not clear if the Euro-3 and Euro-4 standards could be achieved in Europe without MTBE. Because of these uncertainties the principal thrust of our recommendations is to permit maximum flexibility for the industry to produce fuels to the Euro-3 and Euro-4 standards. Of the oxygenates available, MTBE and ethanol are used extensively overseas. In some places (mainly USA and Europe) the higher ethers TAME and ETBE make a contribution. Other higher alcohols may make a contribution on an occasional basis. We recommend36 the following: 1. MTBE is the preferred octane enhancer of the world oil industry and would be suitable for use in Australia. In order to ameliorate concerns with groundwater contamination, a national audit on the status of gasoline transport (pipelines) and storage should be conducted with the object of identifying issues that would lead to pollution of water supplies by any gasoline component. 2. Prima facie the use of ethanol is incompatible with proposed standards with respect to oxygen content and RVP at the commonly used 10% level. Waivers specifically for
36
Our recommendations are based on an optimal response to the problem of fuel harmonisation involving costs to the motorist, cost to the refiner and environmental impacts. It should be recognised that the health effects of the chemicals are reviewed from secondary sources and it may be that recently published material has been overlooked which may be prejudicial to one or more of the additives.
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ethanol in these areas are not in line with the aim of the standards. Nevertheless, we recognise the social desire to see ethanol included in the Australian gasoline pool. The use of ethanol in future Australian gasoline pool should be subject to further analysis, particularly defining how the required RVP from ethanol blends can be met using Australian basestocks. 3. In order to maximise the flexibility for refiners or importers to provide high octane gasoline, it is possible that ETBE and TAME could be used, once these chemicals have been notified by potential manufacturers and importers to NICNAS and assessment certificates have been issued. ETBE and TAME are not currently listed on AICS 4. The widespread introduction of 98 octane fuel would require a substantial review of octane production in Australia, implying a major overhaul of refinery operations. It is not clear if 98 octane will result in a net global emissions improvement. Until this is clarified by additional work, the widespread introduction of 98 octane gasoline should not be encouraged by auto-makers and regulatory agencies. 5. There should be no in-principle objections to the use of either MMT or ferrocene. MMT is the best researched and most widely used and would offer the refiners a method of ensuring the final gasoline is of the required octane (trimming). There is increasing interest in ferrocene, however, the depth of analysis is much less that that for MMT. Further there are several alternative suppliers of ferrocene and quality standards of the additive may be a concern. 6. To facilitate flexibility, the following oxygenates should be permitted in Australian petrol. These oxygenates could be used alone or in combination with other oxygenates or permitted organometallic compounds (MMT, ferrocene). The maximum level should be set by the Euro-3 maximum oxygen content of 2.7%: Oxygenate Ethanol TBA MTBE DIPE ETBE TAME ETAE Isopropanol n-propanol Isobutanol n-Butanol sec-Butanol Chem. Abstract No. 64-17-5 75-65-0 1634-04-4 108-20-3 637-92-3 994-05-8 919-94-8 67-63-0 71-23-8 78-83-1 71-36-3 78-92-2
REFERENCES
AIP, Australian Institute of Petroleum Statistical Review 1999, Petroleum Gazette 3/1999, p.39 Braun A., Octane Boosters and Australian Petrols SAE Australasia, Jan/Feb 1985 and A.R. Braun, Automotive Fuel Extenders from C4 Hydrocarbons NERDDP report EG/83/201, June 1983. Coffey Geosciences Pty Ltd. Setting National Fuel Quality Standards March 2000 CONCAWE Report Number 99/56 FORD SAE Paper 821193 Gary, J.H. and Handwerk, G.E., Petroleum Refining Technology and Economics, 2nd Edition, Marcel Dekker, New York, 1984 Grady, S., Osinski, M., Preliminary Findings of the 12 State MTBE/VOC Drinking Water Retrospective presented April 1999 to Blue Ribbon Panel. Happel, A.M. et al., An evaluation of MTBE Impacts to Californian Ground Water Resources Lawrence Livermore National Laboratory report UCRL-AR-130897; presented to Blue Ribbon Panel, March 1999. Maples, R.E., Process Refinery Process Economics PennWell Books, Tulsa, Oklahoma, 1993 McNally, M.J., National Petroleum Refiners Association, Annual Meeting, mar 22-24, New Orleans, 1992 reported in Oil & Gas Journal, 1992, May 25, p. 39 NOHSC: National Occupational Health and Safety Commission. Technical Report. List of designated hazardous substances. NOHSC: 10005. Sydney. Commonwealth of Australia; National Occupational Health and Safety Commission, Worksafe Australia Standard. Adopted national exposure standards for atmospheric contaminants in the occupational environment. NOHSC: 1003. Canberra: Australian Government Publishing Service: 1995 OSTP (Office of Science and Technology Policy), National Science and Technology Council Interagency Assessment of Oxygenated Fuels, June 1997 RMIT Desk Study Octane Enhancers, November 1994 Salanitro, J.P., Understanding the Limitations of Microbial Metabolism of Ethers Used as Fuel Octane Enhancers, Curr. Opin. Biotechnol. 6, 337-340, 1995 Semenov, N.N (translated by J.E.S. Bradley), Some Problems of Chemical Kinetics and Reactivity - Volumes I & II Pergamon Press 1958 & 1959
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Squillace, P., MTBE in the Nations Ground Water, national Water Quality Assessment Program Results presented to the Blue Ribbon Panel April 1999 Steffan, R.J., et.al., Biodegradation of the Gasoline Oxygenates MTBE, ETBE and TAME by Propane Oxidising Bacteria Appl. Environ. Microbiol. 63(11), 4216-4222.
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EXHIBITS
1. Ethyl Corporation Comments on MMT February 2000 2. A Aradi, J. W. Roos. B.F. Fort, Jr., T. E. Lee and R. I. Davidson The Physical and Chemical Effect of Manganese Oxides on Automobile Catalytic Converters, SAE Technical paper Series 94047, SAE 1994 3. J. W. Roos, D. L. Lenane, B.F. Fort, D.G Grande, K.L. Dykes The Effect of Manganese Oxides on OBD-II Catalytic Converter Monitoring, SAE Technical paper Series 94047, SAE 1994 4. Achieving Clean Air and Clean Water Report of the Blue Ribbon Panel on Oxygenates in Gasoline; September 1999, EPA420-R-99-021 5. T.C. Sneller (Nebraska Ethanol Board) Oxygen Standard Should be Maintained 6. Lyondell Chemical Company Dissenting Report. 7. M.C. Kavanaugh and A. Stocking Fate and Transport of Ethanol in the Environment Presentation to Blue Ribbon Panel, May 24 1999 8. Malcolm Pirnie Inc. Evaluation of the Fate and Transport of Methanol in the Environment American Methanol Institute, January 1999, (Downloadable @ www.methanol.org) 9. Scorecard Lists of Known and Suspected Toxic Compounds with References 10. Scorecard data on additives and gasoline components of interest 11. State of California Environment Protection Agency - Chemicals Known to the State to Cause Cancer or Reproductive Toxicity March 10, 2000 12. Supply and Cost of Alternatives to MTBE in Gasoline - Technical Appendices- Report on Tax Incentives for Ethanol, California Energy Commission, October 1998. 13. Supply and Cost of Alternatives to MTBE in Gasoline - Technical Appendices- Report on the Oxygenate market: Current production Capacity, Future Supply Prospects and Cost Estimates, California Energy Commission, October 1998. 14. Graf Enterprises - Various data sheets relating to Fuel Effect as a gasoline additive. 15. Australian Historic Motoring Federation Inc. Submission. 16. Octane Enhancer Information held in NICNAS. 17. Supply and Cost of Alternatives to MTBE in Gasoline - Technical Appendices-Technical Documents. 18. Supply and Cost of Alternatives to MTBE in Gasoline - Technical Appendices- Ethanol Blending Properties For Task 3 Modelling Work, California Energy Commission, October 1998. 19. RMIT blending calculations, May 2000 20. G. Wood and M.Egyed Risk Assessment for the Combustion Products of Methylcyclopentadienyl Manganese Tricarbonyl (MMT) in Gasoline Health Canada, November 1994 21. CONCAWE Report 99/51 Proposal for Revision of Volatility Classes in EN 228 Specification in light of EU fuels directive. 22. Alcohols and Ethers, A technical assessment of their application as fuels and fuel components American Petroleum Institute, API Publication 4261, July 1988. 23. World-Wide Fuel Charter, April 2000. 24. Evaluation of MTBE as a Component of Reformulated Gasoline C. P. Koshland et alia., Submission to EPA Blue Ribbon Panel, March 1999: also University of California MTBE Fact Sheet. 25. MMT Information Package - Ethyl Asia Pacific Company, May 2000
26. Supply and Cost of Alternatives to MTBE in Gasoline - Executive Summary and Key Findings, California Energy Commission, October 1998. 27. Octel PLUTOcen G Octane Improver - technical and hazard data sheets 28. Octel The Impact on Emission System Durability of Plutocen G Treated Gasoline. 29. Plutocen G: Exhaust Emissions Toxicological data, September 1999

Octane Report

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OCTANE ENHANCING PETROL ADDITIVES/PRODUCTS

LITERATURE REVIEW AND ANALYSIS

IDENTIFICATION OF CHEMICAL ADDITIVES .........................................................5

EFFECTS ON PETROL CHARACTERISTICS, ENGINE EFFICIENCY, COMPATIBILITY, AND EMISSIONS PROFILE.......................................................15

FINANCIAL COSTS OF THE ADDITIVES ...............................................................31

ENVIRONMENTAL AND HEALTH EFFECTS OF ADDITIVES ...............................39

IMPEDIMENTS OF HARMONIZATION WITH EUROPEAN UNION QUALITY STANDARDS ...........................................................................................................59

STAKEHOLDER INPUTS ........................................................................................67

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IDENTIFICATION OF CHEMICAL ADDITIVES

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Isopropanol n-propanol Isobutanol sec-Butanol n-Butanol

Ferrocene Benzene Toluene Butane Isooctane Xylenes (mixed)

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EFFECTS ON PETROL CHARACTERISTICS, ENGINE EFFICIENCY, COMPATIBILITY, AND EMISSIONS PROFILE

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RVP (kPa) 250 130 70 65 55 28 7

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10 92.6 84.6 58.0 TAME 7 93.2 85.2 69.7

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60.0 67.8 7.8

(kPa) 358 88.2 108.2 48.9 53.8 31.7

Olefins (% Vol.) 0 1.0 0.4 29.4 0.5 0.7

Aromatics (% Vol.) 0 3.9 0.9 29.3 0.4 66.2

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A/F ratio 600 RPM MTBE Methanol Ethanol

Toluene 900 RPM MTBE Methanol Ethanol

Toluene 600 RPM MTBE Methanol Ethanol

Toluene 900 RPM MTBE Methanol Ethanol

+743 +33 -3 -10 +51 +13 +28 +40 +33 +18

-291 -742 -561 -234 +37 -315 -544 -364 -134 -3

n +2.4 +1.7 +2.4 +1.9 n +0.8 +1.1 -0.7 n

Toluene 900 RPM MTBE Methanol Ethanol

n n n n n n -201 -211 n -322

-24 -6 -74 -2 +61 -51 -3 -6 -33 +77

+0.40 +1.80 +1.70 n n +0.97 +1.06 +1.00 n -0.77

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hexane toluene methanol ethanol n-propanol

butanols ethers Aggressive Solvents acetone nitromethane

SP 7.3 8.9 14.5 13.2 11.9 11.5 ~11 ~10 10 12.6

FP 0 0.001 0.388 0.296 0.152 0.178 ~0.1 ~0.1 0.695 0.780

Methanol fuel vehicles are specially made for that fuel.

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FINANCIAL COSTS OF THE ADDITIVES

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Data provided by Fuel Ethanol Association of Australia.

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ENVIRONMENTAL AND HEALTH EFFECTS OF ADDITIVES

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