SPEECH BY MR THARMAN SHANMUGARATNAM, MINISTER FOR EDUCATION, AT THE GROUNDBREAKING CEREMONY OF THE PHASE 6 EXPANSION PROJECT OF OILTANKING SINGAPORE, AT JURONG ISLAND, ON WEDNESDAY 20 JULY 2005, AT 11.30 AM

Mr Rutger van Thiel, Managing Director, Oiltanking Singapore

Mr Chia Kim Piow, Managing Director, Rotary Engineering Limited

Distinguished Guests, Ladies and Gentlemen

1. I am very pleased to join you at this groundbreaking ceremony, which marks the latest expansion of Oiltanking’s terminal and an important addition to the Jurong Island complex.

2. Oiltanking is a good friend of Singapore, having started its operations here in the early 1990s. It has been an important player in our petroleum and chemical logistics landscape, providing a significant share of the total independent storage capacity for petrochemical products.

Importance of the chemical logistics cluster

3. Jurong Islandis now recognized as one of the world’s largest integrated chemical complexes. The industry clustering approach that we have taken on the island enables chemical-related companies to feed into one another, share infrastructure, improve efficiency and benefit from hardened security. The strategy is working well. It has given companies, big and small, a competitive edge.

4. Chemical logistics is a key element of this clustering approach, and a key element behind the competitiveness of the chemical industry in Singapore.

5. This is where Oiltanking comes in, as a third party storage provider. In specialising in the storage business, it is able reap economies of scale, achieve greater cost efficiencies and free the chemical companies to focus on their core business of manufacturing.

6. Beyond directly supporting the chemical industry here, the chemical logistics cluster has also contributed to Singapore’s position as a consolidation and break-bulk hub for chemicals. Chemical transshipment traffic through Singapore has in fact more than doubled in the last four years, from just under 1,500 chemical tankers in 2000 to over 3,200 vessels in 2004.

7. The presence of world-class independent storage facilities is also one of the factors that helps entrench Singapore as Asia’s leading oil trading hub. Singapore is the world’s third largest oil hub, and the top bunkering location. Over the last year, we have seen a marked increase in trade of physical oil products and derivatives. It is facilities such as Oiltanking’s which help to meet the demands of the oil trading community, and strengthen our competitiveness as an oil hub.

8. I would add that our oil trading hub has spinoffs to our services sector, including legal, finance and treasury, insurance and logistics functions.

Forging stronger partnership with Oiltanking

9. In short, Oiltanking is a key player as we seek to enhance Singapore’s role as one of Asia’s leading manufacturing, transshipment and trading hubs for petroleum and chemical products.

10. Similarly, I believe Singapore plays an important role in Oiltanking’s growth in the region. We want to build on this strong and mutually beneficial partnership and continue to grow together.

11. Let me express my heartiest congratulations to Oiltanking, and also Rotary, the main contractor for the development of this new terminal. I look forward to the successful completion of your terminal in the coming year.