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Shell boosts production for chemicals customers in Asia

Final investment decision taken to increase production capacity of high-purity ethylene oxide and ethoxylates to meet projected demand in Asia.
Jurong Island, Singapore

Shell’s new investments in its existing assets on Jurong Island, Singapore (above), will boost its footprint in the growing Asian chemical industry

Shell today announced new investments at its Singapore site that will add to its portfolio of world-class manufacturing facilities and boost its chemicals footprint in Asia. The company has taken a final investment decision to build new petrochemicals production units on Jurong Island to supply customers in the region.

The new investments will be built over some 35,000 square metres of land, about the size of seven football fields. They include a high-purity ethylene oxide (HPEO) purification column with an initial capacity of 140,000 tonnes per annum (tpa) and two world-scale ethoxylation units with a combined capacity of 140,000 tpa.

These will add to Shell’s existing capacities for HPEO (65,000 tpa) and alcohol ethoxylates (40,000 tpa) from the company’s 2010 acquisition of its partner’s shares in Ethylene Glycols (Singapore) Private Limited. The new investments also include associated facilities, such as product tanks and a HPEO pipeline grid. The pipelines will deliver HPEO to new and potential “over-the-fence” customers, some of whom have already signed up with Shell and are building facilities nearby.

Official groundbreaking took place today for these new plants, as well as for the upgrading of Shell’s polyols production facility, announced in February 2013. The ceremony was officiated by Singapore’s Senior Minister of State for Trade & Industry and National Development, Lee Yi Shyan; Executive Vice President of Shell Chemicals, Graham van’t Hoff; and Chairman of Shell Companies in Singapore, Lee Tzu Yang.  More than 150 guests witnessed the event.

Lee Tzu Yang, Shell Singapore Country Chairman; Lee Yi Shyan, Singapore’s Senior Minister of State for Trade & Industry and National Development; and Graham van’t Hoff, EVP Chemicals at the groundbreaking ceremony.

L-R: Lee Tzu Yang, Shell Singapore Country Chairman; Lee Yi Shyan, Singapore’s Senior Minister of State for Trade & Industry and National Development; and Graham van’t Hoff, EVP Chemicals

Graham van’t Hoff said, “The demand for alcohol ethoxylates in Asia is expected to increase at approximately 6-7% annually over the next five years. The key driver for this is the move by consumers from laundry powder and soap bars to liquid detergent and liquid soaps, especially in major markets like China, India and South-east Asia. Shell is one of a few global suppliers of HPEO and alcohol ethoxylates - we are expanding to meet the growing needs of our existing and new customers.”

Man doing laundry

HPEO, derived from ethylene oxide (EO), is used in a wide range of household and industrial applications. Its largest outlet is the ethoxylation industry, which processes HPEO and alcohol into alcohol ethoxylates. These are key ingredients for a variety of products, such as detergents and personal care items like shampoo and body wash.

Feedstock for the new HPEO plant will come from Shell’s world-class ethylene oxide/mono-ethylene glycol plant on Shell Jurong Island, which is integrated with the company’s ethylene cracker through to its largest fully-owned refinery on Pulau Bukom.

Graham van’t Hoff added, “These new investments build on the ones that we have announced in the last six months, which included the upgrading of our polyols plant and the debottlenecking of our petrochemical cracker on Pulau Bukom.

They underscore our global strategy to continue investing in our existing assets, which is vital for our long-term growth, particularly in the expanding Asian petrochemicals market. They also showcase our ability to derive maximum value from the integration of Shell’s oil and chemical businesses.”

Lee Tzu Yang underlined Shell’s commitment to Singapore, “HPEO and alcohol ethoxylates have increasing strategic importance in Asia for the chemical industry. Our investment here allows us to take the lead to support Singapore’s growth in this area by leveraging the country’s excellent position as a world-leading petrochemicals hub.”

Singapore Economic Development Board’s Director of Energy and Chemicals, Eugene Leong, said, “Shell’s investment in HPEO is an exciting development for Singapore. Besides deepening the integration within Jurong Island and leading to a more vibrant ecosystem, companies using HPEO will be able to support their customers’ growing needs in Asia from Asia.”

Notes to editors

Shell’s leading position in ethylene oxide

  • Shell has been a leader in ethylene oxide (EO) technologies and markets for more than 50 years, and intends to remain a leading player.
  • We are among the largest global producers of EO and ethoxylates, with world-class manufacturing facilities in Europe, the US, and Asia-Pacific.
  • Shell proprietary technology is used to make almost half of all the EO produced in the world.
  • Our latest catalysts convert up to 90% of ethylene into ethylene oxide (EO) during the production process when it is combined with oxygen at high temperature, compared to about 80% with the previous generation of catalysts.
  • Our ethoxylates and alcohols are sold under the NEODOL*  brand. We produce high-quality products manufactured to global specifications, allowing customers to create global formulations.
  • Our technical product experts, located in Houston and Amsterdam, work closely with customers to identify the appropriate products for their needs, and to optimise customer formulations.

About Shell Jurong Island, Singapore

  • Shell Jurong Island is the collective name for three operations that manufacture styrene monomer, propylene oxide, polyether polyols, propylene glycols, mono-ethylene glycol, high-purity ethylene oxide and alcohol ethoxylates.
  • For more information, visit the Shell Jurong Island profile .

About Shell Chemicals

  • The term ‘Shell Chemicals’ collectively refers to Shell Group companies engaged in the chemicals business.
  • Shell Chemicals has a heritage of more than 80 years. We rank among the world’s Top 10 chemicals suppliers, selling over 18 million tonnes of petrochemicals per year to customers, many of whom are leaders in their own fields.
  • Our world-class integrated manufacturing plants are in Asia-Pacific (Singapore), Europe (Netherlands), and North America (the US Gulf Coast and Canada).
  • We have three leading research centres in the US, the Netherlands and India, with nearly 3,000 scientists and support staff.
  • Our market-leading proprietary technologies underpin our strong product portfolio. We also invest to develop next-generation technologies that could use new types of feedstocks, at lower costs and with reduced environmental impact.
  • We draw strength from being part of an integrated energy company - we benefit from shared infrastructures, access to a variety of feedstocks, and deep manufacturing and processing expertise. This gives Shell a competitive advantage over stand-alone chemicals companies.

For further information, please contact:

Asia

Serene Loo

Tel: +65 6384 8943 / +65 9729 7294

Email: serene.loo@shell.com 

Cindy Lopez

Tel: +6 012 282 1765

Email: cindy.lopez@shell.com 

United Kingdom

Yam-Chew Oh,

Global External Communications Adviser – Chemicals

Tel: +44 20 7934 2253 / +44 7837 955 995

Email: yam-chew.oh@shell.com 

Cautionary Note

Resources: Our use of the term “resources” in this announcement includes quantities of oil and gas not yet classified as Securities and Exchange Commission of the United States ("SEC") proved oil and gas reserves or SEC proven mining reserves.

Resources are consistent with the Society of Petroleum Engineers 2P and 2C definitions.

The companies in which Royal Dutch Shell plc directly and indirectly owns investments are separate entities. In this announcement "Shell", "Shell Group" and "Royal Dutch Shell" are sometimes used for convenience where references are made to Royal Dutch Shell plc and its subsidiaries in general. Likewise, the words "we", "us" and "our" are also used to refer to subsidiaries in general or to those who work for them.

These expressions are also used where no useful purpose is served by identifying the particular company or companies. "Subsidiaries", "Shell subsidiaries" and "Shell companies" as used in this announcement refer to companies in which Shell either directly or indirectly has control, by having either a majority of the voting rights or the right to exercise a controlling influence.

The companies in which Shell has significant influence but not control are referred to as "associated companies" or "associates" and companies in which Shell has joint control are referred to as "jointly controlled entities". In this announcement, associates and jointly controlled entities are also referred to as "equity-accounted investments".

The term "Shell interest" is used for convenience to indicate the direct and/or indirect (for example, through our 23 per cent shareholding in Woodside Petroleum Ltd.) ownership interest held by Shell in a venture, partnership or company, after exclusion of all third-party interest.

This announcement contains forward looking statements concerning the financial condition, results of operations and businesses of Shell and the Shell Group.

All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements.

Forward-looking statements are statements of future expectations that are based on management's current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements.

Forward-looking statements include, among other things, statements concerning the potential exposure of Shell and the Shell Group to market risks and statements expressing management’s expectations, beliefs, estimates, forecasts, projections and assumptions.

These forward looking statements are identified by their use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect", "goals", "intend", "may", "objectives", "outlook", "plan", "probably", "project", "risks", "seek", "should", "target", "will" and similar terms and phrases.

There are a number of factors that could affect the future operations of Shell and the Shell Group and could cause those results to differ materially from those expressed in the forward looking statements included in this announcement, including (without limitation):

(a) price fluctuations in crude oil and natural gas; (b) changes in demand for Shell's products; (c) currency fluctuations;

(d) drilling and production results; (e) reserves estimates; (f) loss of market share and industry competition; (g) environmental and physical risks;

(h) risks associated with the identification of suitable potential acquisition properties and targets, and successful negotiation and completion of such transactions; (i) the risk of doing business in developing countries and countries subject to international sanctions;

(j) legislative, fiscal and regulatory developments including regulatory measures addressing climate change; (k) economic and financial market conditions in various countries and regions;

(l) political risks, including the risks of expropriation and renegotiation of the terms of contracts with governmental entities, delays or advancements in the approval of projects and delays in the reimbursement for shared costs;

and (m) changes in trading conditions. All forward looking statements contained in this announcement are expressly qualified in their entirety by the cautionary statements contained or referred to in this section.

Readers should not place undue reliance on forward looking statements. Additional factors that may affect future results are contained in Shell's 20-F for the year ended 31 December 2011 (available at www.shell.com/investor  and www.sec.gov). These factors also should be considered by the reader. Each forward looking statement speaks only as of the date of this announcement, 16th April 2013.

Neither Shell nor any of its subsidiaries nor the Shell Group undertake any obligation to publicly update or revise any forward looking statement as a result of new information, future events or other information. In light of these risks, results could differ materially from those stated, implied or inferred from the forward looking statements contained in this announcement.

Shell may have used certain terms, such as resources, in this announcement that the SEC strictly prohibits Shell from including in its filings with the SEC. 

U.S. investors are urged to consider closely the disclosure in Shell's Form 20-F, File No 1-32575, available on the SEC website www.sec.gov. You can also obtain these forms from the SEC by calling 1-800-SEC-0330.