Shell grows Singapore petrochemicals footprint with new investment

Feb 05, 2013

Final investment decision taken to increase production capacity and grades of polyols on Jurong Island

Shell announced today that it has taken a final investment decision to upgrade its Singapore production facility for polyols, raw materials used in the manufacture of high-quality foams in furniture, bedding and the automotive industry. By employing Shell’s proprietary technology, this investment is expected to increase existing polyols capacity by more than 100,000 tonnes per annum and add new grades to Shell’s product offer. The project is expected to be completed in 2014.

“The Asia Pacific market for polyols has grown rapidly over the years and we see increasing demand for higher-comfort products, hence the requirement for a wider polyols offering. The additional volume and grades from this Singapore investment will enable us to meet customer demand growth from key markets in Asia, particularly China,” said Graham van’t Hoff, Executive Vice President for Shell Chemicals.

The polyols upgrading will be achieved by optimising existing facilities and deploying a catalyst that improves the on-site conversion of propylene oxide and ethylene oxide to polyols. Shell’s proprietary technology has the added benefits of consuming less energy and process materials, as well as generating less waste.

Graham added, “We paved the way for this project and other investments a few years ago when we acquired in 2010 our partner’s shares in Ethylene Glycols Singapore (EGS), then a joint venture with a Japanese consortium.  EGS supplies ethylene oxide, one of the raw materials needed to produce certain grades of polyols.”

Chiew Nguang-Yong, General Manager for Shell Jurong Island, said, “Shell has the right asset base on Jurong Island to capture growth opportunities in the region. Customers will clearly benefit from our investment as we can now produce the products they need more sustainably and efficiently.”

This polyols expansion project is the latest investment to strengthen Shell’s Propylene Oxide & Derivatives business globally. In 2008, Shell completed similar works to increase polyols capacity at its Pernis manufacturing site in the Netherlands. In November 2012, Shell and joint venture partner SABIC announced that they are developing a range of polyols and styrene monomer/ propylene oxide plants at their Sadaf facility in Saudi Arabia.

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Notes to editors

  • The new polyol grades include ethylene oxide-tipped grades for moulding and high-resilience foam applications.
  • Shell Jurong Island is the collective name for three manufacturing operations that manufacture styrene monomer, propylene oxide, polyether polyols, propylene glycols, mono-ethylene glycol, high-purity ethylene oxide and oleo-alcohol ethoxylates. The production capacity for polyols is expected to be 360 kilo tonnes per annum after the upgrading.

About Shell Chemicals

  • The term ‘Shell Chemicals’ collectively refers to the chemicals business operated by certain Shell Group companies.
  • Shell Chemicals has a heritage of more than 80 years. We rank among the world’s Top 10 chemicals suppliers, selling over 20 million tonnes of petrochemicals per year to customers who are leaders in their own fields.
  • Our world-class manufacturing plants – many integrated with Shell refineries – are in Asia Pacific (Singapore), Europe (Netherlands), and North America (the USA and Canada).
  • Singapore is Shell’s largest petrochemical production and export centre in the Asia-Pacific region.
  • We have three leading research centres in the USA, 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:

Singapore

Serene Loo, Shell Spokesperson, Asia Pacific

tel: +65 6384 8943 / +65 9729 7294

Email: serene.loo@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

Definitions & 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, 5 February 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.