Exxon to permanently shut one steam cracker in Singapore from March: Sources
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Exxon has in the past two years gradually scaled down term contract volumes with customers in Singapore.
PHOTO: REUTERS
Follow topic:
- ExxonMobil will shut down its older Singapore steam cracker from March 2026 due to petrochemical industry losses and overcapacity in China.
- The shutdown will reduce ExxonMobil's naphtha imports and may lead to feedstock purchases to keep derivative units running.
- This closure follows ExxonMobil's workforce reduction plans in Singapore and the sale of its local retail business.
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SINGAPORE - ExxonMobil plans to wind down operations at the older of its two steam crackers on Jurong Island from March 2026, four sources familiar with the matter said, as part of a global petrochemical sector trend to reduce capacity amid industry losses.
The shutdown of the plant, which opened in 2002, is expected to be completed by June, two of the sources said.
The sources asked not to be identified because they were not authorised to speak to the media.
The imminent shutdown of the US giant’s first cracker in the Republic comes as chemical producers grapple with losses from overcapacity led by China, the world’s largest consumer of petrochemicals used to make products ranging from plastics and clothes to shoes and cars.
“As a matter of practice, we do not comment on market rumours or speculation,” an ExxonMobil spokesperson said in response to Reuters’ queries.
The planned shutdown comes after Exxon’s start-up earlier in 2025 of a new steam cracker in the southern Chinese city of Huizhou, which can produce around 1.6 million tonnes per year (tpy) of ethylene.
Exxon has in the past two years gradually scaled down term contract volumes with customers in Singapore, a second of the four sources said.
Local buyers will likely switch to offtake from the two remaining ethylene producers in Singapore, traders said.
Exxon has a second 1.1 million tpy cracker on Jurong Island, which started operations in 2013.
South Korea, another major petrochemical hub in Asia, is also seeing sector consolidation.
POST-CLOSURE PLANS
Exxon is considering buying feedstock to continue operating some of its derivative polyolefin units after the cracker’s shutdown, depending on margins, the first source said.
“Assuming no operational changes at its second cracker and corresponding downstream units, running the polyolefin units associated with the shut cracker will necessitate the purchase of feedstock,” said Ms Catherine Tan, senior manager for chemical analytics at ICIS.
“Unless they can secure very low olefins prices, this is unlikely to be economically viable in the long term,” added Ms Tan, who expects Exxon to cut imports of naphtha, the cracker’s main feedstock, as a result of the shutdown.
For the first 11 months of 2025, Exxon imported about 1.5 million tonnes (13.4 million barrels) of naphtha, compared with nearly 2.5 million tonnes for all of 2024, data from ship-tracking firm Kpler showed.
In October, Exxon said it expected to cut 10 per cent to 15 per cent of its Singapore workforce by 2027.
The company also agreed to sell its petroleum retail business in the city-state to Indonesia’s Chandra Asri, co-owner of Aster Chemicals, which runs the Bukom refinery-petrochemical complex.
In September, however, Exxon started operations at a new refining unit at its 592,000 barrel-per-day Singapore refinery. REUTERS
