CHEMICAL ENGINEERING TRANSACTIONS
VOL. 52, 2016
A publication of
The Italian Association
of Chemical Engineering
Online at www.aidic.it/cet
Guest Editors: Petar Sabev Varbanov, Peng-Yen Liew, Jun-Yow Yong, Jiří Jaromír Klemeš, Hon Loong Lam
Copyright © 2016, AIDIC Servizi S.r.l.,
ISBN 978-88-95608-42-6; ISSN 2283-9216
Economic Feasibility Study on the Wastewater Treatment
Plant in Fuel Companies. A Cuban Study Case
Yailen Bustoa, Edesmin W. Palacios*b, Liz M. Ríosc, Javier Martínc, Yamell
Jiménezc, Hortensia Pérezd, Miriam Yerae
aTechnological University of Israel, Francisco Pizarro street and Orellana Avenue E4-142, Quito, Ecuador
bFaculty of Odontology, Central University of Ecuador,University Citadel between Bolivia and Salgado street, Quito, Ecuador
cCentral University of Las Villas, Camajuani street km 5 ½, Santa Clara, Villa Clara, Cuba
dFuel Trading Company of Villa Clara. Road to Subfloor 76, 50300, Villa Clara, Cuba
eIberoamerican University of Ecuador, 9 de Octubre and Santa Maria street, Quito, Ecuador
wsaudades@gmail.com
In the Cuban oil industry, wastewater from the process of reception and distribution of hydrocarbons, contain a
wide range of contaminants with high chemical and biological oxygen demand (COD and BOD). However, the
most significant pollutants of these effluents are the hydrocarbons, fats and oils due to its high toxicity and
ability to spread in thin layers on the water surface which difficult the passage of sunlight, hurting life in such
ecosystems.
Two technological alternatives were evaluated from technical, economic and environmental point of view. The
first one, considered as short-term solution (rehabilitation of the existing system) and second one (building of a
collection pool), considered investment in the medium to long term. Taking into account the equipment
acquisition cost as well as the process flow requirements, the total investment cost for both alternatives was
estimated. Furthermore, the main dynamic economic indicators: Net Present Value (NPV), Internal Rate of
Return (IRR) and Pay Period (PP) were evaluated to develop a comprehensive economic-financial study using
the method of "Percentage of Delivered Equipment". In addition, a sensitivity analysis to evaluate the effect of
increases or decreases in the price of the process equipment market over the economy of the proposal variant
was analysed.
From the economic point of view, alternative 1 reported higher gross annual earnings ($ 2,139,553) compared
to the second variant ($ 2,131,428). However, considering that the annual income of the company are
substantial ($ 11,791,284 in 2013), the alternative 2 proposes a more effective solution from a technological
point of view achieving greater life of the proposed technology and as better operation and maintenance.
Moreover, this technological option guarantees a significant reduction on the environmental pollution risk.
1. Introduction
Approximate 88 % of global energy needs from the developing countries are mainly supplied from fossil fuel
sources such as coal (28 %), oil (40 %) and natural gas (20 %) (Phneah et al., 2015). Due to the world is
heavily dependence on fossil fuels, the planet had already experienced warming by 0.8 K over the past 100 y
(Northon, 2015). Petroleum refining is an industrial activity with intensive use of energy, highly contributing
with greenhouse gas (GHG) emissions (Caballero et al., 2014). The process of refining crude oil consumes
large amounts of water. Consequently, significant volumes of wastewater are generated (Martinez-Huitle et
al., 2014). Oilfield wastewater or “produced water (PW)” contains various organic and inorganic components
that can pollute surface and underground water and soil (Ahmaduna et al., 2009). Pollution problems at the
local, national and international levels are part of our daily life. It is a concern the way in which ecosystems of
our planet as well as the surface layer of the crust have been degraded. Industrial activity has caused one of
DOI: 10.3303/CET1652147
Please cite this article as: Busto Y., Palacios E. W., Rios L. M., Martín J., Jiménez Y., Pérez H., Yera M., 2016, Economic feasibility study on
the wastewater treatment plant in fuel companies. a cuban study case, Chemical Engineering Transactions, 52, 877-882
DOI:10.3303/CET1652147
877
the most serious problems of soil contamination, where the oil spill occupies one of the top spots (Orozco et
al., 2004).
Hydrocarbons pollution is widely spread all over the world and our country is no exception. The oil and
petrochemical industries are the medullar point in the production of hydrocarbons and derivatives. These
products are designed to meet our energy requirements of fuels and lubricants for the industry and
transportation sectors. Hydrocarbons spills constitute the major source of soils contamination as well as
surface, ground water, flora and fauna pollution problems. Some hazard substances such as hydrocarbons
have carcinogenic activity to the detriment of humans and animals. The presence of these chemicals in
groundwater represents a huge threat for human consumption.
One of the most common problems, and that frequently accompanies other soil contamination is related to
industrial hydrocarbons leakage. This problem extends, in no small measure, to auxiliary tanks and local
distribution of hydrocarbons. Fuel leaks may occur during the production, handling, storage and transport of
the process. From these industrial leaks, the most dangerous one are those that are hidden, being only
discovered when the wells and/or rivers contamination occurs. His previous detection is therefore difficult and
expensive. A retrospective analysis has shown how the most common causes are occasional and long-term
leaks, in places of container or pumping tanks (Castro, 2007). As regards the significant matter of
environmental concern, many countries have implemented more stringent regulatory standards for discharging
“produced waters”. On the other hand, because large volumes of these contaminated waters are being
generated, many countries with oilfields, which are also generally water-stressed countries, are increasingly
focusing on efforts to find efficient and cost-effective treatment methods to remove pollutants as a way to
supplement their limited fresh water resources (Martinez-Huitle et al., 2014).
The marketing and distribution activity of fuels in the country constitute a key element of the economic
development due to innumerable productive and service areas require this raw material for its operation,
primarily in the energy order. The Fuel Trading Company of Villa Clara (ECC VC) is responsible for receiving
and distributing the amount of oil requested by the province. This company belongs to the Union of Cuba-
Petroleum from the Ministry of Energy and Mines.
This company is one of the companies on business improvement of the province that has advanced in recent
years with regard to improving their business management schemes. This has been the result of several
management systems implementation, such as quality (ISO 9001:2008), safety and health (NC 18001:2005),
environmental management (ISO 14001:2004) among others. All the above systems have been certified
except environmental management, due to the persistence of environmental issues that cause significant
environmental impacts. The poor performance of the wastewater treatment system has led to non-compliance
with some of the parameters of the standard wastewater disposal (NC: 27/2012, 2012).
This situation could cause the imposition of environmental taxes and harsher penalties due to actions of
regulatory bodies of the Ministry of Science, Technology and Environment, the Public Health as well as the
National Institute of Hydraulic Resources.
To the above joins, that wastewater oil industry contains a wide range of contaminants with high chemical and
biological oxygen demand (COD and BOD). However, undoubtedly, are hydrocarbons, fats and oils, the most
significant of those polluting effluents. On the other hand, these substances are extremely toxic to the
ecosystems life due to his property of spread of in thin layers on the water surface preventing the passage of
light, which harms life in such systems (Kraus, 2013).
In the ECC VC, liquid and solid wastes are produced during operations and soils are contaminated with
hydrocarbons due to spillage or leakage point. As part of the environmental policy of the country is a priority
the proper treatment of waste fluids before being available to the receiving bodies. Currently, it constitutes an
unmet need because the ineffective operation of the existing waste treatment systems disables efficient
management and sustainable management of watersheds and the environment in general. The main objective
of this study is to assess a rehabilitation project of the existing liquid waste treatment of the ECC VC from
techno-economic and environmental points of view.
2. Material and methods
2.1 Site description
The wastewater treatment plant of the Fuel Trading Company of Villa Clara is located in the central region of
the country specifically in the productive area. The main goal of the system is to treat and reduce the
concentration levels of pollutants before being discharged to the receiving body in order to fulfil with Cuban
regulations. The current system is able to recover the hydrocarbon and the effluent or treated water poured to
a valley next to the installation. The wastewater treatment plant with a processing capacity of 722 m3/y
established for a constant volume of production of the ECC VC, should be able to efficiently remove the
hydrocarbons contained in the oily water and reuse the recovered oil (0.52 t/y) and may bring economic
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benefits in their marketing when it is mixed with used oil. This system comprises an API separator, a Slop tank
and a collecting lagoon (Figure 1).
Figure 1: Flux diagram of the wastewater treatment system of Fuel Trading Company of Villa Clara (ECC VC)
2.2 Type font and type size
The treatment system of wastewater of the Fuel Trading Company of Villa Clara (ECC VC) involves a
triangular collector lagoon with dimensions 20 m × 20 m × 30 m and 1.5 m deep, which goes all the liquid
waste from cleaning and drainage of fuel storage tanks and scrub plant of fuel transporting vehicles.
Subsequently, using a pump system (pump 1), of the collecting lagoon is sucked the petroleum that is floating
on the surface to the API longitudinal separator of two sections, of dimensions 2.7 m long × 1.75 m wide and
2.7 m tall. The input channel of the separator allows equalization of water, eliminating turbulence and allowing
the flow regime is in the separation channels, as laminar as possible and achieves greater efficiency in the
separation process. To facilitate this process, will ensure a constant liquid level of 2,000 mm for those
particles of free hydrocarbons can join and upload more quickly to the surface. Subsequently, the hydrocarbon
collected in the separator channels is pumped (pump 2) to a vertical ESSO Slop tank (53.44 m3) which aims to
separate water from hydrocarbon by decantation. The decanted water in Slop tank is pour back into the
longitudinal separator as rectification process. Finally, the treated water exits the bottom part of the separator
and is discharged to the environment (Figure 1).
2.3 Techno-economic and environmental assessment
Technological assessment of the wastewater treatment system was developed considering the results
obtained from previous studies, deficiencies found in the process and availability of the market. Two
technologies were evaluated from the technical, economic and environmental points of view. The first
technological alternative considered as short-term solution (rehabilitation of the existing system) and second
one (building of the collection pool), identified as a medium or long term investment.
The economic assessment was addressed to determine static economic indicators such as Total Capital
Investment (TCI), Total Production Cost (TPC) and Annual Gross Profit (AGP) as well as dynamic economic
indicators such as Net Present value (NPV), Payback period (PP) and Internal Rate of Return (IRR). Total
investment costs were based on the estimation of acquiring cost of equipment and accessories used for the
operation of the wastewater treatment plant of ECC VC. For calculations, the specific year in which each of
equipment was installed and included in the system was taking into account. To determine the investment cost
of the pumps, flow requirements of the process and equipment selection according to catalogue were
included. Estimating the Total Investment Cost for both rehabilitation of the wastewater treatment plant that is
currently installed (alternative 1), as if to for the construction of the collection pool (alternative 2) was
performed using the method of “Percentage of Delivered Equipment " reported by Peters et al. (1991).
3. Results
3.1 Characteristics and deficiencies of the wastewater treatment system of ECC VC
As a result of previous studies and monitoring of wastewater, the treatment system is capable of achieving
removal rates that ensure a residual according to the NC 27:2012, if it operates satisfactorily and with the
proper maintenance. However, currently the system is not working efficiently and residuals are sent to the
receiving body without effective treatment (Águila, 2008). The major deficiencies were identified as follows:
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- Due to frequent filling and emptying of storage tanks, drainage thereof is performed sporadically. Added to
this is the poor condition of the pipes and part of the pipes used in the treatment system, which means that in
practice, all this waste reaches the separator.
- The lagoon receives the volume of wastewater and storm water generated in the tank. However, the lagoon-
separator system does not work due to nonfunctioning of pumping required, so that the supernatant
hydrocarbon, content in the lagoon is not recovered.
- The separator is dirty, being corroded, there is evidence of impairment constructive, passes between the
chambers, and valves mostly, are out of service.
- The residual of the maintenance shop (scrubbing floor) area has a grease trap system are discharged into
the grease trap and thence to the storm water drainage network to the lake, so do not receive adequate
treatment.
3.2 Feasible alternatives to revitalize the wastewater treatment system
Two technological alternatives were evaluated from the technical, economic and environmental point of view.
The first one, considered as short-term solution (rehabilitation of the existing system) and second one
(building of a collection pool), considered investment in the medium to long term.
For both alternatives, the first action to be executed in the project is the restoration and improvement of
system API separator - Slop tank. To do this it is necessary to develop the following technical tasks:
• Clean and remove the sludge present in the API separator,
• Reinstall the existing pump system using positive displacement pumps and rehabilitate existing valves,
• Remove the interconnection between compartments and seal the leaks,
• Removing hydrocarbon purge to the separator, emptying the tank if necessary,
• Relocate the Slop tank drain to the inlet of the separator and
• Install sampling of level at Slop tank to determine the interface of oil-water separation.
As a second action to carry out as part of Alternative 1, the following technical tasks should be implemented:
• Empty and remove the lagoon sludge,
• Restoring the waterproofing layer of clay,
• Rehabilitate the slope of the lagoon, as well as the existing record and finally,
• Rehabilitate the extraction system of superficial hydrocarbon of the pond, with pump 1, using skimmer with a
flexible hose.
Similarly, the second action to be performed in alternative 2 must include, in addition to the above, the
following technical tasks:
• Perform earthwork and excavation and
• Construct the rectangular pool with size 30 m × 10 m × 3.67 m and 350 m3 of capacity (EIPP, 2009).
As a comparative analysis, the Alternative 1 involves an easy and simple commissioning and operation of the
system. Moreover, it is not requiring significant earthworks and construction, as well as increased labour,
reporting less acquisition costs from the economic point of view. However, as main drawback, the current
alternative, not completely guarantee the protection of the environment, because can occur infiltration.
Moreover, from technological point of view, does not facilitate the cleaning and maintenance procedure. From
comparison, option 2 propose a more effective solution from a technological point of view, achieving greater
life of the proposed technology and better operation and maintenance of the same, which guarantees, from
the point of view environmental, reducing potential risks of environmental pollution. Despite their remarkable
advantages, it is necessary stand out that these variants imply higher investment costs compared to
alternative 1; however, its implementation is feasible if we analyse the cost-benefit relationship (Dimitri, 2014).
3.3 Economic assessment for both remedial alternatives
The acquisition cost of the process equipments as well as reference sources used for both proposed
alternatives, are reflected in Table 1. From calculations it was obtained that Total Investment Cost for
alternative 1 (US$ 88,643) was due primarily to the Total Direct Costs (US$ 73,645), of which the 48.8 % was
correlated to the cost of equipment purchased. On the other hand, for alternative 2 showed a substantial
increase of the total investment cost (US$ 169,730) due to the increase of total acquiring cost of the
equipment mainly by concept of construction materials cost (US$ 14,515), earthwork (US$ 6,217) and
buildings (US$ 9,326).
An integrated economic analysis of the proposed technology with the Fuel Trading Company of Villa Clara
(ECC VC) was carried out for both alternatives of rehabilitation of the wastewater treatment system. For this
integration, the values of Total Capital spending (US$ 10,530,800) and Total Annual sales (US$ 12,031,900)
reported in 2015 by the CUPET Trading Company were included (data reported by personnel of the plant).
In order to develop a comprehensive economic-financial study, the main dynamic economic indicators (NPV,
IRR, and PP) were evaluated for both alternatives. Static and dynamic indicators of the two integrated
alternatives are shown in Table 2.
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Table 1: Equipment investment costs of the wastewater treatment plant
Equipments Alternative 1 (US$) Alternative 2 (US$) References
Horizontal separator API 16,640 16,640 (Matches, 2012)
Positive displacement pumps 7,600 7,600 (Matches, 2012)
Slop tank vertical ESSO 5,074 5,074 (CUPET, 2015)
Stabilization Lagoon 1,055 - (IMC, 2015)
2 Valves of Ø8” 1,000 1,000 (Peters et al., 1991)
Collection Pool - 24,917 (IMC, 2015)
Table 2: Economic assessment of both integrated alternatives using static and dynamic economic indicators*
Economic Indicators Integrated Alternative 1 Integrated Alternative 2
Annual sales (US$) 11,791,284 11,791,284
Annual Total Production Cost -TPC (US$/y) *** 9,647,510 9,651,774
Annual depreciation (US$/y) ** 4,221 8,082
Annual Gross Profit - AGP (US$) 2,139,553 2,131,428
Return on investment, aver. - ROI (%/y) 869 452
Payback period - PP (y) 0.1 0.2
Net Present Value - NPV (US$) 11,990,732 11,888,043
Internal Rate of Return - IRR (%) 2,177 1,135
* Considering the economic data reported by the Company Distributor CUPET (2015).
**Considering an annual depreciation factor of 0.05 (20 year life of the plant).
***Considering the price of recovered hydrocarbon of wastewater and reused for oil blends 7.23 US$/HL
(Information provided by the ECC VC, 2015).
Considering the results obtained in the economic evaluation, could be selected alternative 1 as the best
alternative to be implemented in the Company, because a greater Annual Gross Profit for the first alternative
(US$ 2,139,553) was observed compared to the second (US$ 2,131,428). Also, the internal rate of return is
about twice the value obtained for the second alternative. However, considering that the annual income of the
company are substantial (US$ 11,791,284 in 2015), the alternative 2 proposes a more effective solution from
a technological point of view, achieving greater life of the proposal technology and better operation and
maintenance; which guarantees, from the environmental point of view, reducing potential risks of
environmental pollution. Moreover, taking into account their economic viability as the Pay Period remains at a
value extremely low (less than 1 year) the alternative 2 represents the most feasible option to implement in the
Fuel Trading Company of Villa Clara.
Until now, it has been shown that alternative 2 represents the best option from techno-economic and
environmental terms. However, a sensitivity study was developed in order to assess how sensitive could have
the techno-economic analysis of this alternative to possible (future) changes/variations of the parameters
considered in this study. As the acquisition cost of positive displacement pumps fluctuates on the market; it
was necessary to conduct a sensitivity analysis to assess the effect of increases or decreases on the
economics of the proposed variant. The Figure 2 represents the NPV profiles for the selected alternative
considering changes in the price of pumps.
Figure 2: NPV profiles for alternative 2 considering changes in the price of the pumps
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From the results obtained, it can be state that even if the proposed technology is evaluated with the higher
prices of the pumps (worst economic scenario), the project can be considered feasible. This phenomenon can
be attributed to the fact that the Annual Sales of the Company is extremely high compared to prices on the
pumps.
4. Conclusions
The proposed project for the rehabilitation of the wastewater treatment system will report significant
environmental benefits to the entity due to the minimization of the pollutant load. Moreover, as a result of a
proper system operation, the recovered hydrocarbon could be mixed with the used oils, constituting
commercial value for the company. This research demonstrated that alternative 2 is the most feasible for the
rehabilitation of the wastewater treatment system of the ECC VC from techno-economic and environmental
points of view.
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