Choice between floating facilities, land reclamation to be made soon
Ronnie Lim, Business Times 1 Oct 09;
(SINGAPORE) Jurong Island is running out of land and Singapore will decide early next year on how to augment space at the oil and petrochemicals hub that houses biggies such as ExxonMobil and Shell. One option is to build large floating facilities there to store oil, while further land reclamation is another possibility.
As it is, 75 per cent of the island's 3,000 hectares has been taken up or reserved by oil and petrochemical investors, a JTC Corporation spokeswoman told BT yesterday, adding that 'JTC is in discussions with companies for the remaining 25 per cent'.
It was only last Friday that JTC celebrated the completion of Phases 3 and 4 of reclamation, which added 1,500ha and doubled the total land available at the highly integrated island complex. And so far, 95 investors have ploughed in more than S$31 billion there so far.
But already, some companies which had earlier postponed investments because of the global downturn will be resuming their projects soon, JTC chairman Cedric Foo said last week, without citing names.
Germany's Lanxess recently indicated that it expects to start building its over S$800 million synthetic rubber plant around mid-2011. India's GMR also hopes to restart the long-stalled S$1.2 billion Island Power cogeneration project once it secures gas feedstock, while Jurong Aromatics Corporation's US$2 billion petrochemical complex should be underway, once it completes its financing.
Meantime, oil trader Hin Leong is still in discussions with JTC on its expansion plans for the S$650 million Universal Terminal, while Tuas Power and Sembcorp Cogen plan to build more cogeneration capacity to provide utilities like steam and power.
Mr Foo said that to optimise land use there, JTC has gone underground to build the S$890 million first phase of the Jurong Rock Cavern to store oil and 'will soon be going out to sea' as it is exploring building very large floating structures (VLFS) also for oil storage.
JTC's Phase 1 studies, completed in late 2007, showed such floating storage to be technically feasible and comparable in cost to land-based oil storage.
And it will now decide whether to build the VLFS depending on the outcome of the Phase 2 study which will be completed next March, the JTC spokeswoman said yesterday.
Phase 2 covers possible sites, environmental impact, engineering design, business model and security of the VLFS - each of which would store as much oil as a very large crude carrier (VLCC).
'We will continue to explore various options,' the spokeswoman said, when asked what JTC intends next, should the floating storage idea prove a no-go.
While she declined to elaborate, one option is understood to include further land reclamation - as petrochemical investors would still want to be located on Jurong Island to enjoy all the synergies like raw materials and infrastructure available from the integration there.
As for floating oil storage, JTC's Phase 1 studies showed that for a VLFS to be viable, it should have a minimum storage of 300,000 cubic metres - equivalent to the capacity of a big tanker. A VLFS would comprise two rectangular modules, each measuring 180m by 15m and with 150,000 cu m of storage. Preliminary cost estimates came to at least S$180 million.
Meanwhile, construction proper of the first phase of Jurong Rock Cavern is starting this year, with the first two caverns providing 480,000 cu m expected to be ready in the first half of 2013. The entire Phase 1, comprising five caverns, will provide 1.47 million cu m of storage when completed in 2014.
Related link
More reclamation at Jurong Island? from wild shores of singapore with more links to the issues.
