Singapore's Targets World Class Ethylene Projects with Shell's Billion Dollar Cracker and ExxonMobil's Expansion and Project Plans

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Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). The proposed greater than $1 billion petrochemical project Shell has announced in Singapore could have its 2006 construction start-up, if the financial structure is confirmed during 2005. The brownfield project will be built on the existing infrastructure of the Pulau Bukom refinery, which should reduce the project definition time when compared to the 12-18 months needed for the definition of a grassroot world-class petrochemical project.

It is reported that Shell Eastern Petroleum (London, U.K.) and Singapore's Economic Development Board (EDB) will be spending a 'significant amount' on detailed design and engineering, and will be negotiating with downstream investors before giving the final OK. EDB announced its participation in the project in December 2004, which followed the withdrawal of Shell's original project partner, Sumitomo Chemicals (Tokyo:4005 ) (Tokyo, Japan). Sumitomo switched its interest to a project to construct a cracker in Saudi Arabia, with Saudi Aramco at Rabigh, attracted by low-cost gas. Sources say that Sumitomo may still participate in downstream operations of the Bukom plant.

The project covers new mono-ethylene glycol (MEG) plant in Jurong Island and a new world scale ethylene cracker on Bukom Island. Modifications and additions will be made to Shell's refinery on Bukom. A shell spokesperson said that the project would be in the world-class scale of 600,000 tons of ethylene a year and 400,000-700,000 tons of MEG a year. Start of operations at the plant is scheduled for the fist half of 2009. The downstream MEG plant will produce intermediate products, such as polystyrene and polypropylene used in soft drink bottles, containers, bags, and other domestic consumer market products.

In January 2005, ExxonMobil (NYSE:XOM) (Irving, Texas) announced a plan to raise the capacity of its existing ethylene plant on Jurong Island from 800,000 tpy to over 900,000 tpy by the fourth quarter of 2006. No exact investment total has been given on the project.

In answer to enquiries about the company's plans to build a second ethylene plant on Jurong Island a spokesperson said, "We are continuously looking at and evaluating opportunities around the world." When this comment is added to the remarks made by Lynne Lachenmeyer, Asian Pacific manufacturing director of ExxonMobil Chemical Asia Pacific, on the current expansion, a new Jurong project would seem possible, if not probable. She said, "The increase in ethylene capacity demonstrates ExxonMobil's commitment to be a reliable global supplier. This expansion will help position us to continue to meet the growing demand in this region."

In addition to ExxonMobil's plant, the state's Petrochemical Corporation of Singapore (PCS) operates two crackers on Jurong Island, with a total capacity of 1.4 million tpy of ethylene. Taking established plants, the country can only claim to have two world-scale crackers, but if the Shell project goes ahead and a new ExxonMobil project is launched, Singapore could be in sight of its target to host five world-scale crackers.

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