ExxonMobil to keep upgrading Singapore ops

It'll continue expanding petrochem/refining operations to ensure it caters to demand in Asia, says retiring Asia-Pac chairman and MD
Ronnie Lim Business Times 22 Oct 11;

OIL giant ExxonMobil - already the largest player here with over US$10 billion of investments - will continue to upgrade its Singapore operations.

Its retiring Asia-Pacific chairman and managing director Kwa Chong Seng told BT yesterday that the company will continue expanding its petrochemical/ refining operations here to ensure it caters to fast-growing Asian market demand.

Following its latest mega US$5-6 billion second petrochemical complex here, which is scheduled to start up next year, ExxonMobil for instance broke ground in May for another major 'green' diesel project here, touted to cost another US$500 million.

The diesel hydrotreater plant will produce 25 million litres of Euro IV-specification diesel daily - or equivalent to the total clean product output from two medium-sized refineries - when it comes on stream by 2014, he said.

It exemplifies what ExxonMobil, the world's largest corporation, plans further here: to deepen the complexity of its Singapore manufacturing operations by building even more flexibility, including in its petrochemical crackers so that they can use more different feedstocks, and in its refinery to produce more products to meet swings in market demand.

This will enable its Singapore export facility to better cater to its target Asian market - especially China and India - which accounts for over 60 per cent of today's global energy demand, said Mr Kwa.

ExxonMobil announced yesterday that Mr Kwa, 65, who has led ExxonMobil's Singapore affiliate for 19 years, will retire at the end of this month, and will be succeeded by Matthew Aguiar, ExxonMobil Chemical Asia Pacific managing director.

Mr Kwa, who has been with ExxonMobil for a total of 42 years, said in the interview with BT that arising from the merger of two small, separate Esso and Mobil refineries here in 1998, ExxonMobil's Singapore operations have now become its biggest manufacturing base worldwide.

This was no coincidence as Singapore, he said, sits at the crossroads of the two largest markets of China (which alone accounts for 60 per cent of the Asian energy growth) and India (about 25 per cent).

'This is where we will continue to upgrade our refinery and petrochemical plants over the next 10 years . . . to build our increments and deepen our conversion capability including to produce more clean and environment-friendly products,' he said. 'We are studying several things, but it's too early to comment (what these projects are),' Mr Kwa added.

ExxonMobil's 605,000-barrels-per-day refinery currently feeds a 900,000-tonnes-per-annum (tpa) petrochemicals cracker complex.

By the middle of next year, a second one-million-tpa cracker under its new Singapore Parallel Train (SPT) complex, which also comprises six downstream plants as well as its own 220-megawatt cogeneration power plant, is expected to be completed.

Asked if the size of the Singapore refinery sets limits on whether ExxonMobil can have more petrochemical investments, Mr Kwa said: 'We need to digest this one (SPT) first before thinking of another.'

'With such a large cracker project, we need to make sure we get it up to maximum operating levels first, and then next, to see how we can get further output increments by debottlenecking or by tweaking it to get further improvements. So that's (the next cracker) some ways away.' 'From the refinery side, there's more we can do. For example, we've just broken ground on the hydrotreater and we need to look at the refinery here, which is still relatively low in conversion capability, to make it even more competitive,' he said.

While the Chinese may be building their own domestic refineries and petrochemical crackers, those projects are meant to cater just to fast-growing domestic needs, he said, citing a recent study which showed that China needs to build one petrochemical cracker a year just for this.

'The Singapore oil industry's role is to fill niches in that (China) market, and it needs to be competitive to do so. And that's where economies of scale and size matter as it makes us more efficient and competitive,' stressed Mr Kwa.