SINGAPORE : Petroleum giant Shell has confirmed it will proceed with the construction of a new butadiene extraction unit in Singapore.

The facility will form part of Shell's Eastern Petrochemicals Complex, which it is building on Pulau Bukom and Jurong Island.

Shell's Eastern Petrochemicals Complex is targeted for start-up in 2010. And the new butadiene extraction unit will form part of this world-scale project, which also includes an ethylene cracker.

The butadiene unit will be built on Pulau Bukom and have an initial capacity of 155 kilo tonnes per annum.

Shell said the new plant would help the company meet the demands of the region's fast-growing petrochemical industry.

Dr A Chockalingam, Startup Manager, Shell Eastern Petroleum Complex, said, "Over the next 10 years, Asia will need several crackers to meet the olefin demand and this is one of many. Butadiene is used to make rubber-based products which goes into tyres, adhesives and also in spandex material for nylon; it's another growing area as well."

The Shell Group is considered the largest marketer of butadiene globally.

It has contracted a large part of the new plant capacity for butadiene to industry players in the region.

The building of Shell's Eastern Petrochemicals Complex is expected to create thousands of jobs.

Shell said some 8,000 people would be needed to construct the plant and another 200 to run it.

Shell declined to reveal the exact investment cost for its new butadiene plant on Pulau Bukom.

It would only say that it would form part of the overall cracker project, which is estimated to cost several billion US dollars. - CNA/ms