$50m waste fuel plant to be ready in Oct
Business Times 12 Jun 08;
WITH oil prices rocketing towards US$140 a barrel last week and natural gas prices rising in tandem, Sembcorp Industries appears close to finalising plans to use refuse-derived fuels to produce cheaper electricity and steam for the petrochemical industries on Jurong Island.
A first S$50 million plant in Tuas to process and sort municipal waste collected by the utilities/environment group into dry waste fuel will be ready this October, Tang Kin Fei, its president and CEO said on Tuesday.
Following that, 'Sembcorp expects to make an investment decision by this year-end for a cogeneration plant burning such refuse-derived fuels', he said.
'In dollar terms, the investment for this should run into three-digits,' he added, implying hundreds of millions of dollars.
Furthermore, it will also need to scale up its refuse-derived fuel processing capacity for this, Mr Tang said, adding that it will need to replicate its S$50 million pilot plant which can process less than one-third of the total waste it collects here.
'It can process only about 680 tonnes per day, while we collect a total of 2,200 tonnes of municipal waste daily,' he said, implying that more investment for the front-end waste processing is also needed.
Mr Tang disclosed this during a lunch meeting with BT on Tuesday where he elaborated on Sembcorp's plans to build another cogen plant to supply mainly steam to new petrochemical plants at the Tembusu sector of Jurong Island. This is in addition to its existing 815-megawatt cogen plant in Sakra which is 100 per cent gas-firing.
But as natural gas, which Sembcorp sources from Indonesia's Natuna, is pegged to rising high sulphur fuel oil prices, Sembcorp intends to use more alternative fuels in the long term, he had told BT earlier in April.
Industry sources earlier said that piped Indonesian natural gas prices here had risen by about 30 per cent in the first six months from around US$12.80 per million British thermal unit in January to US$16.40 by June.
'Sembcorp's plan is to carve out a niche for itself and prepare for this future (alternative fuels) environment,' Mr Tang said.
The group has already chalked up considerable experience on using sustainable fuels in the UK, with its operations there also earning it carbon credits.
Last September, it started up a S$193 million wood-fuelled biomass power station at Wilton International, making it the first such large-scale industrial power plant in the UK to be fuelled entirely by renewable wood.
The station there uses 300,000 tonnes of sustainable wood a year - including recycled timber, chips from sawmills, and dedicated willow crops grown nearby - to generate 30 MW of electricity, or enough to power 30,000 households.
Its earlier Wilton power plant, apart from coal, gas and fuel oil, can also burn tallow - the solid fat from cattle and sheep - as fuel.
