The complex, Exxon Chemical's largest project in the Asia-Pacific region, is expected to begin operations in the fourth quarter of 2000, Warwick Bisley, president of Exxon Chemical Singapore told a news conference.

The Economic Development Board (EDB) said that with Exxon's project, Jurong Island, Singapore's chemical production hub, would have Singapore $6 billion ($3.64 billion) worth of investments in new projects now under implementation.

"This project will definitely strengthen the chemical industry in Singapore and help us develop a world class chemical hub," Philip Yeo, chairman of EDB, said.

As part of this plan, Bisley said there would be an ethylene and propylene grid on the island to ensure easy feedstock availability to all donwstream plants.

Exxon's petrochemicalcomplex would be centred around a 800,000-tonne per year (tpy) steam cracker that would produce ethylene, propylene and other basic petrochemical feedstocks. Bisley said about 60 per cent of this feedstock would be consumed by downstream Exxon plants, which produce annually 480,000 tonnes of polyethylene unit, 275,000 tonnes of polypropylene and 150,000 tonnes of oxo-alcohol.

When asked, he declined to reveal if the company had secured any third party contracts for the consumption of the remaining 40 per cent of the output.

The Exxon complex includes a 155 megawatt co-generation plant, which would provide power to both the petrochemical complex as well as the adjacent Esso Singapore 230,000 barrel-per-day refinery.

Bisley said the petrochemical plant would source its feedstock requirement from the refinery.

Exxon's confirmation comes on the heels of a joint annoucenment by BASF AG and Shell Chemicals Ltd on Thursday that they had signed a letter of intent to form a new 50/50 joint venture to producestyrene monomer and propylene oxide in Singapore.

Investment for the joint-venture project would exceed $500 million with a final investment decision by the boards of the two companies expected in 1999.

EDB's Yeo said these new investments would accelerate the growth of the chemical industry in Singapore as well as enhance Jurong Island's image as a world class chemical hub.