The turmoil in global markets notwithstanding, Tuas Power (TP) is set to proceed shortly with Phase 2 of its $2 billion clean coal/biomass multi-utilities expansion on Jurong Island.
‘We have secured enough customers for us to embark on Phase 2,’ TP’s president and chief executive Lim Kong Puay told BT yesterday.
He stressed that the project to supply utilities like power and steam to new petrochemical investors there ‘is a long-term investment’, and is not affected by the current turbulence.
TP is seeking the ‘go-ahead’ shortly from owner China Huaneng Group for the Phase 2 project, he added.
Huaneng, which just reported H1 financials on Aug 9, said that TP, the third largest genco here, had upped its share of the Singapore electricity market by 2.2 percentage points to 26.7 per cent in the Jan-June period.
The TP chief was just back from Japan where he met new customers, including petrochemical investors in Jurong Island, but declined to name them.
BT recently reported that there has been a spate of new Japanese players investing in chemical plants here to tap feedstock from Shell and ExxonMobil’s new mega petrochemical crackers in Singapore.
They include Zeon Chemicals, Sumitomo Chemical and Asahi Kasei Chemicals, all three of whom are setting up synthetic rubber, or styrene-butadiene rubber plants on Jurong Island, with Zeon holding its ground-breaking shortly, on Sept 1.
Another is Denka which is building a second plant here, this time to produce chemicals that go into making automotive interior parts.
Mr Lim declined to go into specifics on how much Phase 2 of its Tuas Multi-Utilities Complex (TMUC) will cost, but would only say that it will comprise mainly steam plants. It includes a 450-tonne -per-hour circulating fluidised bed boiler, and a 200-tonne-per-hour back- up boiler.
They will boost TMUC’s Phase 1 – currently under construction – which will produce 200 tonnes of steam per hour and 100 megawatts of power when it starts up from the second half of next year.
Mr Lim earlier indicated that a substantial portion of TMUC’s Phase 1 steam and electricity has already been committed to customers such as Germany’s Lanxess and Taiwan’s Dairen Chemicals, each of which is building mega $500-$700 million projects on Jurong Island.
And that is why TP is now set to proceed with Phase 2 of the project.
TP’s TMUC facility will be the first here to use coal feedstock, and earlier this year the genco tied up a deal with Jakarta-listed PT Bayan Resources, which will supply it with 13.36 million tonnes of low-sulphur, low-ash, sub-bituminous coal from Kalimantan for 15 years, starting next year. TP has a second long-term deal with South Korea’s Samtan which also has a coal mine in Kalimantan.
‘We have options to increase the coal quantities when needed,’ Mr Lim said, when asked if TP will be sourcing more coal feedstock for Phase 2.
The TMUC project, occupying a 14-hectare site at Tembusu sector – where the main power and steam will be produced, and includes a desalination plant – has sea frontage to allow the coal, as well as tropical biomass, mainly palm kernel, to be shipped in from suppliers.
