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The petrochemicals giant ExxonMobil says it will go ahead to build its second steam-cracker complex in Singapore.
The project is estimated to cost more than six billion dollars and will take Singapore's ethylene output to four million tonnes a year.
However, the EDB is already planning to further boost ethylene output by another 50 per cent.
The new cracker on Jurong island, to be completed early 2011, will be Singapore's fifth.
It's also the second in as many years.
Just last year, Shell Eastern started constructing its $4.6 billion dollar cracker on Bukom Island which will be completed by 2010.
The two plants are expected to increase Singapore's petrochemical output by 40 per cent.
Output from the industry amounted to S$22 billion last year.
Together, they will produce 4 million tonnes of ethylene a year.
But the EDB wants to push this even further.
"We certainly are looking at how to grow this sector. We've reached a critical mass and we hope to take it even further. So from four million tonnes of ethylene a year, we hope to get six plus million tonnes a year. That would really put Singapore on par with roughly what you see in Japan today. It will enable us to further broaden our downstream activities and add value and bring value out of the entire development,” said Aw Kah Peng, Director of Chemicals of the Economic Development Board.
The new cracker will provide feedstock or raw materials to produce high value products, such as specialty elastomers and polyethylene resins.
Exxon says this will make its existing refinery and petrochemical complex more cost-competitive.
"Our project is a fully integrated project that employs Exxonmobil's proprietary technology, we see that as giving us a lot of competitive advantage, so by being fully integrated, it gives us advantage in feedstocks, it gives us advantages in operating costs, it gives us advantages in overall investments,” said Jeffrey Davis, Asia Pacific Manufacturing Director of ExxonMobil Chemical Company.
Its decision to go ahead demonstrates its confidence in Singapore as well as the long term market growth and demand for plastics.
"Our markets are the petrochemical markets and these markets are growing very rapidly. So, they're growing twice GDP, over the next ten years, we expect that over half of that demand will be in Asia. And these markets go ahead, they go into textiles, they go into consumer products, they go into automotive, they cross a large variety of markets," Mr Davis added.
Economists estimate this new plant will add up to half a percent to Singapore's GDP.- CNA/vm
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