A message to the oil patch - sulphur IS your business

From our guest columnist: 'Thiophilos'

Big Oil’s attitude toward sulphur is not hard to understand. There was a time, not so long ago, that sour natural gas associated with many prolific oil producing fields was routinely flared to atmosphere, until the LNG business become fashionable. The same selectivity as to whether sulphur is an appropriate business to be in has been associated with the more recent heavy oil and oil sands, which have even attracted the moniker of ‘dirty oil’, partly because of their high sulphur content. The simple scientific facts, however, leave little doubt that there is a common factor in all subdivisions of the energy business. In this World Year of Chemistry it is worth noting that the chemical process of “oxidative release of chemically stored energy” is the common factor throughout the spectrum of such “businesses”. If you are involved in one of them then, by association, you are involved in all of them – whether you like it or not.

The earliest days of Oil Patch involvement in the sulphur business came with the desire to rid the sour crudes of their bad smell and even worse effects (corrosion) on production and combustion equipment. The relatively small amounts of sulphur involved were ‘tolerable’ until sweeter crudes began to be harder to find. Half a century ago by far the largest source of elemental sulphur for world industrial needs came from mining of pre-existing elementary sources of the yellow element. It was mined in lock step with the world demand for the stuff, largely for sulphuric acid manufacture.

Then came sour gas and sour oil processing and a huge new source of recovered sulphur. In the middle of the 20th century 70% of the world supply of sulphur was from mined sources (elemental sulphur or mined iron sulphide ore). By the beginning of the 21st century the source situation has reversed: 90%+ of world sulphur supply is recovered from sour hydrocarbon processing. Big Oil is in the sulphur business – Big Time.

If you are at all familiar with the commercial history of either the Oil Patch or the Sulphur Patch over this fifty year period you will also be familiar with the struggles that emerged between the two over the supply and control of the world’s sulphur supply. The US vested interests in the Frasch mining business, the Alberta sour gas recovered sulphur market (producing the element and energy), the rise and fall of the Polish sulphur mining venture and, most recently, the heavy oil and oil sand sulphur sources of both Alberta and Venezuela, again producing both energy and sulphur.

However the sulphur market place may be viewed, the hydrocarbon industry is and will continue to be the prime producer of the element. That is where the ultimate control of supply rests. That is where the challenge to improve recovery efficiency is placed by the environmental protectionists. And that is where the money supply is to be found to establish and maintain the new products and markets that will be essential to maintain a balance between production and consumption of the yellow element in a world wide marketplace.

Sulphur magazine’s market graph tells a tale of instability far more succinctly that any words can hope to do. For the better part of half a century – most of it while the Oil Patch did not have control of the production – the elemental sulphur commodity price fluctuated between $25 - 100/ton f.o.b. production source. Then came the wild times of the past few years; from $100 to $700/ton within months and crashing back down to near zero in an equally short time. Even market economists with the most accommodating of views look at these numbers and gasp in disbelief. “Who was at the controls?” they ask. “How did it happen?” they ponder. And looking at the very recent rise back up to near $250/ton f.o.b., the question is now “Could or even IS it happening again?”

To opine that there has been no answer offered to any of these questions might be unjustified. But to question the explanations that have been offered is nothing if not justified. The considered opinion of Thiophilos is not complex. It is traditional market psychology. The fewer options there are for sales in any market, the less stable that market will be. The vested interests control. And that, dear readers, (and some detractors) is the current situation with respect to the sulphur business. A multimillion ton/annum world wide market with two – yes only two – really significant market outlets, which can be reduced to one of you chose to name it as chemical technology. That single outlet is sulphuric acid, and its two commercial subdivisions are fertilizer/ore processing and as an energy source for the chemical industry. It should be a black eye for the scientific curiosity and inventiveness in this World Year of Chemistry that, with the myriad of sulphur market opportunities staring society in the face, genuinely new uses for the yellow element are as ignored as they are. Many have been identified and written about in the technical media, even advertised as being available commercially. But they remain unattractive to those who claim the lion’s share of profits from the other contents of Mother Nature’s purse from which the really raw materials cometh.
Can we muster the effort, ingenuity and enterprise to break out from our safe established commercial havens in to the exploratory developments that will take us the next step along the road to discovery of new horizons? We may well find that there lie an assembly of riches to match those our forefathers left for us. Look around you at sulphur’s opportunities – many are there.

‘Thiophilos’