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Shell eyes Asian market with new plant in Tuas

Singapore

ROYAL Dutch Shell on Wednesday opened an integrated lubricants and grease production plant in Singapore to meet Asia's growing appetite for such products.

The facility, its third-largest lubricants facility globally and second-largest in the Asia-Pacific, can produce up to 430 million litres (390,000 tonnes) of lubricants and greases every year.

It is located next to the Singapore Lube Park in Tuas, and will replace Shell's current facility in Woodlands, which has a production capacity of 240,000 tonnes per annum (tpa).

The Lube Park is a shared-facilities joint venture between Shell, Sinopec and Total. It comprises an import-export jetty, pipelines and a 159,000 cubic metre tank farm.

In 2013, Sinopec opened a similar facility, a S$134 million one with a capacity of 100,000 tpa, on an adjacent site. Two years later, Total followed with a S$150 million blending plant there with a capacity of 310,000 tpa.

Shell declined to reveal the investment cost for its new plant.

Huibert Vigeveno, executive vice-president for Shell global commercial division, said the state-of-the-art, highly automated facility was built to support Shell's business ambitions in the Asia-Pacific.

"It serves as a strategic production hub, and will be the centrepiece of our lubricants supply chain network to reliably supply our world-class lubricants to millions of customers in the region," he said.

Products from the plant - including passenger car motor oil branded as Shell Helix, and heavy duty engine oil known as Shell Rimula - will be shipped to more than 40 countries, mainly in the Asia-Pacific; the region accounts for more than 40 per cent of the global market for finished lubricants.

Shell operates 50 lubricants blending and grease manufacturing plants globally. In Asia, it has 16 plants in China, India, Indonesia, Malaysia, Pakistan, Singapore, South Korea and Vietnam. Three out of its five base oil plants are also in the region.

Mr Vigeveno added: "This facility will also strengthen the presence of our marine lubricant business in Singapore, the world's second busiest port."

Minister for Trade and Industry (Industry) S Iswaran said at the opening that the growing lubricants segment will strengthen the synergies in Singapore's integrated energy and chemical industry. He noted that the base oil used in the production of the lubricants are produced by the refineries here, and that there are also facilities in Singapore that produce lubricant additives.

Lubricant blending plants blend these intermediates to produce the high-value finished lubricant products.

"Shell's investment in this new plant is a clear demonstration of the organisation's continued confidence in Singapore as a location for high value-added energy and chemicals manufacturing," he said. "It is also a recognition of the growth opportunities that can be seized from Singapore."

Lim Kok Kiang, assistant managing director of the Economic Development Board, said that Shell's commitment to improving its productivity through the adoption of innovative technologies is aligned with the strategies to transform the energy and chemicals industry, which were unveiled recently.

"With a 50-per-cent increase in capacity and six-fold improvement in productivity over its previous plant, the new plant will be yet another great showcase of an advanced manufacturing facility that provides Singaporeans with good jobs," he said.