Wednesday, Nov 11, 2009


 
    By Florence Tan and Max Lin 
    Of DOW JONES NEWSWIRES

SINGAPORE (Dow Jones)--State-owned Qatar Petroleum International and Royal Dutch Shell PLC (RDSB.LN) said Wednesday they will invest in two of the Anglo-Dutch company's petrochemical joint ventures in Singapore.

A new joint venture company called QPI & Shell Petrochemicals (Singapore) will hold 50% of Petrochemical Corp. of Singapore and a 30% stake in The Polyolefins Co., the companies said in a joint statement.

They didn't elaborate on the shareholding structure of the joint venture or on how much Qatar would be investing.

Qatar Energy Minister Abdulla Bin Hamad Al-Attiyah and Shell Chief Executive Peter Voser signed the agreement in Singapore Wednesday. The transaction is expected to be completed next month.

The deal is the second collaboration between Qatar and Shell in Asia's downstream sector. They are also developing a refinery-petrochemical project with PetroChina Co. (PTR).

"Qatar is a significant and fast-growing producer of chemical feedstocks," said Al Attiyah, a deputy prime minister of Qatar who also serves as minister of energy and infrastructure.

"Extending our reach further into petrochemicals in the crucial Asia-Pacific region will help us reach our ambitious goal," he said.

Singapore is Shell's largest petrochemical production and export center in the Asia Pacific region, according to the company's website.

"One of the critical success factors of any petrochemical venture...is access to competitive feedstocks," said Ben van Beurden, executive vice president of Shell Chemicals.

"I'm hopeful that condensate and liquefied petroleum gas will flow from Qatar to Singapore as a result of QPI taking an interest in these joint ventures," he said.

Petrochemical Corp. of Singapore operates two steam crackers that produce 1.9 million metric tons of ethylene. A Japanese consortium led by Sumitomo Chemical Co. (4005.TO) holds a 50% stake in PCS.

The Polyolefin Co. produces 260,000 metric tons of low density polyethylene and 600,000 tons of polyproylene annually. Another Japanese consortium also led by Sumitomo Chemical holds 70% of TPC.

Shell Eastern Petroleum operates a 500,000-barrel-a-day refinery on Pulau Bukom. The company is building a petrochemical complex comprising an 800,000-metric-ton-a-year steam cracker and two downstream units due to be fully operational in the first quarter of 2010.

In Qatar, Shell and Qatar Petroleum are building a Pearl gas-to-liquids, or GTL, plant scheduled for completion by the end of 2010. The $18 billion project, the world's largest facility to turn natural gas into transportation fuels, is entirely funded by Shell, which will share revenue from its output with Qatar.

-By Florence Tan and Max Lin, Dow Jones Newswires; 65 6415 4067; florence.tan@dowjones.com

(END) Dow Jones Newswires

11-11-09 0351GMT