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Mr Lim Hng Kiang at the Jurong Island Reclamation Completion Ceremony, 25 Sep 09

Mr Lim Hng Kiang at the Jurong Island Reclamation Completion Ceremony, 25 Sep 09

KEYNOTE ADDRESS BY MR LIM HNG KIANG, MINISTER FOR TRADE AND INDUSTRY AT THE JURONGISLAND RECLAMATION COMPLETION CEREMONY ON FRIDAY 25 SEPTEMBER 2009, 10.40 AM

Distinguished Guests

Ladies and Gentlemen

Good morning.

It gives me great pleasure to join you today at this ceremony to celebrate the completion of JurongIsland's reclamation.This is a significant milestone in the history of Singapore’s industrial development.

History of JurongIsland

hieve this, we were confronted with a huge land challenge-finding sufficient land to house the sector.

We lacked industrial land on the Singapore mainland to house more chemical companies.So how to do this offshore?This gave rise to the bold idea to reclaim and join seven southern islands into what we know today as JurongIsland. From an initial area of less than 1,000ha, Jurong Island now spans a land mass of about 3,000ha.And, on top of that, I am happy to note that we have managed to complete the reclamation of JurongIsland ahead of schedule, thus enabling us to market it more holistically to investors.

But the story of JurongIsland is not just a matter of reclamation.The key was industry integration.It was about helping chemical companies save costs by capitalising on vertical and horizontal linkages: upstream plants supplying feedstock to downstream manufacturers, sharing common facilities.It was about finding out the right match of companies to maximize the synergies of integration and co-location.It was about reaping the benefits of economies of scale.To realise this vision, we needed companies to believe in us and our perseverance paid off, with some of the world's largest chemical companies, such as DuPont, ExxonMobil, Eastman, Mitsui Chemicals, Sumitomo and Vopak, agreeing to invest millions of dollars on an island which was very much still under water. These companies came in on our assurance and our track record that we would soon reclaim the plots of land and lay the network of infrastructure.We exceeded their expectations.Today, JurongIsland is home to 95 companies and is the cornerstone of Singapore’s energy and chemical industry.

Overcoming Adversity and Challenges

The story of JurongIsland is the result of innovation, determination, hard work, and perseverance. This project showcases the foresight, tenacity and teamwork of many government agencies in overcoming extraordinary odds.Their efforts have contributed in no small part to Singapore’s economic success.

One example of such tenacity was evident when, in 2005, ExxonMobil was seriously considering locating its second world-scale cracker in Singapore. To meet their needs for a contiguous plot of land next to their current cracker on JurongIsland, we diverted and realigned a stretch of Jurong Island Highway, together with 17 pipelines and 4 core fiber optic cables. This was a mammoth undertaking – it required a delicate balance of meeting both the needs of ExxonMobil, as well as other companies which would be affected by the relocation of pipelines and cables.JTC worked closely with affected companies and agencies to devise innovative solutions to minimise disruption to business operations on the island.

We also did not allow disruption to the import of sea sand to delay our reclamation plans.We opened up alternative sources of sand supply and explored other ways to meet our needs. Overcoming such challenges eventually saw JurongIsland, all 3,000ha of it, come to fruition thereby allowing us to continually secure investments to deepen the cluster linkages on JurongIsland.

A Strong Chemical Cluster-A generator of high output and good jobs

Today, JurongIsland has achieved comparable standing to other chemical hubs in much larger countries such as Japan and Germany.This has allowed us to attract many world renowned energy and chemical companies to Singapore.

95 leading energy and chemical companies have invested more than S$31 billion dollars in fixed assets on JurongIsland.Such a diverse group of both global and local companies allow us to foster a strong thriving chemical cluster with many upstream and downstream linkages across various companies.JurongIsland enables these companies to enjoy production synergies and cost efficiencies.

Collectively, these companies accounted for 80% of the energy and chemical industry manufacturing output, which in itself is the largest contributor to our manufacturing output, at almost 40% in 2008.

The energy and chemical industry also generates good jobs for locals.It has the highest proportion of locals employed and highest skills profile among all other manufacturing industries.The remuneration per worker for chemical sector is almost twice that of the manufacturing average.

The development of JurongIsland has also nurtured many promising local companies in the construction, utilities and logistics arenas.One such example is Rotary Engineering, which started as a small company offering electrical subcontracting works to the oil majors in Singapore.Rotary has since evolved to become one of Asia Pacific’s leading players in providing engineering, procurement, construction and maintenance services for the oil and gas, petrochemical and pharmaceutical industries.Today, Rotary employs over 7,500 employees in more than 30 joint ventures and other operations in Asia Pacific and Middle East.

JurongIsland – Moving Forward

Notwithstanding the milestone event today, we will continue to identify ways to adjust the Jurong Island profile to bring about stronger integration for greater operating efficiencies by the companies. We intend to achieve a critical mass of feedstock, move to higher value chemical chains which produce specialty chemicals and advanced materials, and partner companies in developing new chemical products.

To achieve this vision, we set up a Research and Development centre, the Institute of Chemical and Engineering Sciences or ICES Laboratories on JurongIsland back in 2004.ICES has since hosted several corporate laboratories to carry out R&D in chemical and process engineering.For example, Mitsui Chemicals has collaborated with ICES on catalysis research.The collaboration effort was so successful that Mitsui decided to set up its first R&D center outside Japan.This initiative proved to be a win-win for both Mitsui and ICES. While Mitsui was able to jumpstart its operations in Singapore by leveraging on ready infrastructure and equipment; ICES was able to advance its research collaboration with Mitsui.

In the longer term, our plan is to position JurongIsland as the industrial development model of tomorrow, one which couples world class competitiveness with sustainable and responsible development growth.

Conclusion

JurongIsland was conceived through vision and guts, and carried through with determination and dedication by people who passionately believed that we could develop a world class energy and chemical industry in Singapore. Many of the key players are here with us today.Over the past few decades, JurongIsland has played a major role in advancing Singapore’s economy.The success of JurongIsland lies in the tireless efforts and entrepreneurial spirit of various agencies to create a plug-and-operate environment for companies keen to invest in Singapore.They have done so by putting in place robust infrastructure and building manpower capabilities to jumpstart their operations. The end result is a top-notch working environment that meets the needs of the companies which are located here.

Our special thanks go to the tenants of JurongIsland who provided the viability and vibrancy of JurongIsland.I would like to thank you for your faith and support in the growth of JurongIsland and your contribution in the years ahead.

 
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