CAPITAL: Singapore

MONETARY UNIT: Dollar

REFINING CAPACITY: 1,255,000 b/cd

OIL PRODUCTION: None

OIL RESERVES: None

GAS RESERVES: None

Indonesia`s Pertamina said a project to build a $430 million, 640-km natural gas pipeline from West Natuna field to Singapore`s Jurong Island was on schedule to be completed in mid-2001, despite several snags.

The pipeline would be the largest gas delivery system in the Asia-Pacific region, supplying Singapore`s Sembawang Gas (SemGas) with gas from West Natuna field, in the South China Sea northwest of Borneo.

SemGas would buy the gas from Pertamina, which was obtaining it through production-sharing contracts with Conoco Indonesia Inc., Gulf Resources (Kakap) Ltd., and Premier Oil Natuna Sea Ltd. The gas would be produced from Blocks A, B, and Kakap. The $4 billion sales agreement was for 325 MMcfd. SemGas said it had buyers for the gas.

The pipeline was being built in two sections. Conoco, Gulf, and Premier were responsible for the Indonesian leg, and a Semgas-led group was laying the Singapore section.

The Singapore Economic Development Board said that using the imported gas to fuel cogeneration would further reduce utility costs and enhance overall competitiveness for the chemical companies operating on Singapore`s Jurong Island, a massive complex of processing plants.

The growing industrial sector also spawned a project aimed at importing Indonesian gas. Pertamina agreed to sell Singapore Power Co. 2.27 tcf of gas over 20 years. Gas deliveries were to begin in mid-2002, moved through a planned 500-km pipeline from South Sumatra to Singapore via Indonesia`s Batam Island. Deliveries would begin at 150 MMcfd and rise to 350 MMcfd in 2008. The additional gas would replace fuel oil and diesel feed in the industrial and power sectors.

Jurong Island

Investments in Jurong Island`s booming chemicals industry were expected to double to $23.52 billion from $12.35 billion over 10 years. About 50 companies were producing $6.47 billion/year worth of petrochemicals on the island, according to the Ministry for Trade and Industry.

The chemicals cluster, which included petrochemicals, pharmaceuticals, and other specialty chemicals, accounted for 21.5% of the value of Singapore`s manufacturing sector in 1998.

The government was promoting petrochemicals to reduce Singapore`s dependence on electronics. Both Singapore`s Economic Development Board and the Jurong Town Corp. were developing Jurong as a world-class petrochemicals hub.

The Singapore government invested nearly $2.94 billion in reclamation and infrastructure development on Jurong, which was created by merging a cluster of seven islands with an original land area of 991 hectares.

With reclamation, the island was expanded to 1,800 hectares and by yearend 2001 would reach 2,600 hectares. Jurong Island then could support about 150 companies and five ethylene crackers.

The government was considering using LNG to diversify the sources of power for the island. An LNG terminal would be built on 30 hectares of reclaimed land in Tuas View.

In mid-1999, Singapore`s fuels consumption was 77% fuel oil, 14% natural gas, and 9% diesel. Gas was expected to rise to 25% in a decade.

Projects

Construction of Exxon Chemical Co.`s $2 billion petrochemical complex on Jurong was on schedule.

The project, which included an 800,000-tonne/year ethylene plant, was due completion by late 2000.

The petrochemicals complex was the first steam cracker in Singapore to be integrated fully with a refinery, which was run by Esso Singapore. The complex was to include a 480,000-tonne/year polyethylene plant, a 275,000-tonne/year polypropylene plant, and a facility to produce 150,000 tonnes/year of oxo-alcohol. Separately, Chevron Chemical Co. LLC began production from its $215 million lubricants additives plant at Jurong.

Chevron claimed the plant was the largest in the Asia-Pacific region and would produce 26 individual additive components from over 40 different feedstocks and blend them to produce more than 150 finished additive package blends.

Also, Japan`s Mitsubishi Chemical Corp. and Exxon Chemicals Ltd. planned to build a 100,000 tonne/year polypropylene plant at Jurong by late 2000. Operating as Mytex Polymers Asia-Pacific, it would be fed from Exxon`s petrochemicals complex.

Shell Eastern Petroleum Pte. Ltd. and Germany`s BASF AG formed a joint venture to build a $500 million petrochemical plant at Jurong.

The venture, Basell Eastern (Pte.) Ltd., would produce 550,000 tonnes/year of styrene monomer and 250,000 tonnes/year of propylene oxide. Start-up was slated for second half 2002.

Shell and Petrochemical Corp. of Singapore were building a $100 million condensate splitting unit at Shell`s Pulau Bukom refinery in Singapore.

The 70,000-b/d unit would separate the feed into six products: LPG, light and heavy naphtha, kerosine, gas oil, and a small residue stream. Subsea pipelines were to link the unit with Pulau Seraya, from which further lines would deliver naphtha to PCS`s petrochemical complex on Pulau Ayer Merbau. Completion was due in mid-2000.

Singapore Syngas Pte., a joint venture between Germany`s Messer Group and Texaco Inc., was doubling capacity of its 50 MMcfd synthetic gas plant on Jurong at a cost of $100 million. The plant was to start up in mid-2000.

Despite a surplus of Asian refining capacity, Exxon Mobil Corp. said it would continue to operate the former Esso Singapore Pte. and Mobil Corp. plants in Singapore.

Exxon`s unit was a 235,000-b/d plant on Ayer Chawan Island; Mobil`s was a 300,000-b/d refinery at Jurong.

The merged company had 1.25 million b/d of refinery capacity in the Asia Pacific region.

Exxon Mobil Corp. bought out its partners in Singapore Aromatics Co., which made 350,000 tonnes/year of paraxylene. It bought the 40% held by BP Amoco Plc and the 10% of China American Petrochemical Co.