PowerSeraya poised to strengthen business growth in region

  • Expands diversified energy portfolio with S$20 million investment in new oil blending tanks
  • Earns ‘Desalination Plant of the Year’ distinction award that will enhance reputation for further growth

Singapore, 23 June 2008 – In line with the PowerSeraya Group’s plans to become an integrated energy player in the region, the company announced today that it will be expanding its oil storage capacity with its first oil blending tanks to meet the growing fuel oil needs of the energy-related industry. With an initial investment of S$20 million, the addition of 25,000 cubic meters of new oil blending tanks will improve the company’s fuel oil range and flexibility to meet the needs of its customers. To be completed in the last quarter of 2009, the establishment of these tanks will form part of PowerSeraya’s strategic intent to accelerate its growth in the region.

In an additional development that will further enhance its presence, PowerSeraya’s Seawater Reverse Osmosis (SWRO) Desalination Plant, which is the world’s first to use a 16-inch (400mm) large diameter membrane technology, has also earned a place at the coveted Global Water Intelligence Awards 2008 for ‘Desalination Plant of the Year’. Widely recognised as the top accolade for the greatest technology achievement in the international water industry, the award highlights the success of PowerSeraya’s renewable strategy and is a testament to its commitment of staying at the forefront of innovation to meet industry needs.

Neil McGregor, Managing Director of PowerSeraya, said, “A focus to provide additional avenues of revenue and sustainable solutions are key to PowerSeraya’s renewable strategy for future growth. Expanding our fuel capabilities and earning global recognition for our operational excellence in water production will consequently place PowerSeraya in an ever stronger position to offer multiple commodities.”

Investment in Oil Blending Tanks to Augment Growth
With soaring global fuel prices and increased competition in today’s business environment, customers, both small and large, are increasingly demanding value-added solutions that will drive energy efficiencies to meet their business needs. Growing in tandem with the focus of the industry, PowerSeraya’s investment of S$20 million in two new oil blending tanks to complement its existing storage facilities on Jurong Island will improve its fuel access and flexibility to meet the needs of its growing customer base, particularly those in the marine bunkers and cargoes market.

“Besides our core business of power generation, the introduction of these oil blending tanks will add to the company’s growing portfolio of complementary services to our customers. As fuel prices continue to rise, procuring alternative sources of oil will also reduce the costs of raw materials used in the blending process, thereby allowing us to maintain our competitiveness in the sector,” said Neil.

Through its subsidiary PetroSeraya1, the oil blending tanks – each with a capacity of 10,000 cubic meters and 15,000 cubic meters to handle a wide range of oil product specifications – will equip the company with the capability to source for and fine-blend different types of fuel from various oil-producing nations. Full quality control and procedures will also be in place to ensure product integrity is maintained. This seeks to optimise the value of fuel products for customers and ensures its suitability for use in power generation or marine bunkers.

Rotary Engineering, a regional engineering firm based in Singapore, has been appointed for the construction of the new oil blending tanks and other associated maintenance services.

Global Recognition of Plant Enhances Growth and Value Creation
PowerSeraya’s 10,000 cubic meters/ day Seawater Reverse Osmosis Desalination Plant seeks to use desalinated water as part of its operational processes and promote energy efficiency. With the plant’s recent distinction award for ‘Desalination Plant of the Year 2008′, it will further boost PowerSeraya’s competitiveness to broaden its energy portfolio and include water as a key component of the Group’s highly efficient Combined Heat, Water and Power (CHWP) sales in the future.

“Constraints in resources such as fresh water have made it necessary for PowerSeraya to focus on technologies that use environmentally-conscious processes with cost- effective results. While our desalination plant has set a benchmark in efficiency for the desalination industry, the award further enhances our reputation, which will support our strategy to become a leading full-fledged integrated energy company in the region,” said Neil.

He added, “This has also motivated us to set new targets and pursue continuous improvement in all our business processes. Leveraging Singapore’s strategic location on Jurong island, coupled with PowerSeraya’s in-depth expertise and knowledge of the industry, we will continue to pioneer the growth and demand of viable solutions to deliver value for our customers.”

Established at the beginning of 2008, the doubling of the plant’s SWRO membrane diameter, from the conventional industry standard of an 8-inch (200mm) diameter, is able to produce higher water yield (which in turn is also used to produce electricity) through its sophisticated management systems. This has resulted in reduced water costs to PowerSeraya by as much as 30 per cent. The desalination plant also leads to a 30 per cent reduction in electricity consumption as it lowers energy consumption from over 4 kWh per cubic meter for conventional small membrane plants to 2.85 kWh per cubic meter.

1 PetroSeraya, the physical oil trading arm, was formed in April 2007 by the PowerSeraya Group as part of the company’s diversification strategy to move into non-regulated businesses. This completes the PowerSeraya’s Group value chain – from fuel sourcing and fuel management to electricity generation.