S'pore sets into motion big petrochemical venture
S'pore sets into motion big petrochemical venture
SINGAPORE (AFP): Singapore launched a S$3.4 billion (US$2.26
billion) joint venture on Monday to produce high-value
petrochemicals, capitalizing on rising demand in Asia, officials
said.
The officials said that the complex on nearby Ayer Merbau
island is Singapore's second and involves construction of energy-
efficient plants by Japanese, European and U.S. multinationals.
The project will be the largest single integrated
manufacturing facility in Singapore when combined with a maiden
complex built at a cost of $2 billion 10 years ago.
"This second complex is a strategic project for Singapore --
it heralds a new phase of development for our petrochemical
industry," Trade and Industry Minister Yeo Cheow Tong said at the
project's groundbreaking ceremony.
Yeo said that the second complex was well timed to take
advantage of the current upturn in the petrochemical industry
after a period of sluggish demand.
The project, he said, was strategically located within the
Asia-Pacific region, which was set to see a rise in share of
worldwide chemicals demand by 10 percent to 40 percent by 2000.
Japanese
The project is spearheaded by the Petrochemical Corp. of
Singapore Pte. Ltd. (PCS), a 50/50 joint venture between a
Japanese consortium led by Sumitomo Chemical Co. Ltd. and the
Netherlands' Shell Overseas Investments BV.
The other four companies involved are The Polyolefin Co. (S)
Pte. Ltd. (TPC), Philips Petroleum Singapore Chemicals Pte. Ltd.
(PPSC), Denka Singapore Ptd. Ltd. (DSPL) and Jurong Island
Industries Gas Pte. Ltd. (JIIG).
TPC is a 70/30 joint venture between another Japanese
consortium also led by Sumitomo Chemical and Shell Overseas
Investment while PPSC is a 50/30/20 joint venture between
Phillips Petroleum International Corp. of the United States,
Singapore state-run Economic Development Board Investments Pte.
Ltd. and Sumitomo Chemical.
DSPL is fully-owned by Japan's Denki Kagaku Kogya K.K., while
JIIG is a venture involving a Japanese, Dutch, British and French
investments.
All the multinationals have stakes in Singapore's first
petrochemical complex on the same island.
The complex, which will come on stream by the second quarter
of 1997, incorporates a huge chemical plant under construction on
a neighboring islet, run as a 70/30 joint venture between Shell
and Japan's Mitsubishi Chemical Corp., officials said.
The project would mostly be funded by a mix of borrowings and
equity from cash generated by the ongoing operations of plants
forming part of the maiden complex or direct shareholders' funds,
they said.
Under the project, the PCS will build a second naphtha cracker
to manufacture products such as ethylene and propylene and
byproducts such as acetylene.
"The expansion will consolidate our position as leading
manufacturer of petrochemical products in the Asia Pacific-region
including the production of some one million tons of ethylene
after 1997," said T. Okada, PCS's managing director.