SINGAPORE - Petrochemicals giant Shell is stopping the exploration of two projects in Singapore – a biofuels unit and a Group II base oil plant.

The biofuels project would have produced low-carbon fuels such as sustainable aviation fuel, renewable diesel for road transport or renewable chemicals, while the Group II base oil project would have produced base oil that goes into the making of advanced lubricants.

But the company said its Powering Progress strategy, which aims to accelerate the transition of its business to net-zero emissions, remains unchanged and that it will continue supplying base oil and lubricants, as well as biofuels to its customers in Singapore and the region.

“We will continue to drive the transformation of our business in Singapore through the energy transition,” a company spokesman said. “Shell Singapore’s position as a trading and marketing hub for the region continues to thrive.”

The company noted that it is working on a range of opportunities, with some reaching important milestones this year.

“For instance, our plant that allows us to upgrade pyrolysis oil from hard-to-recycle plastics and turn them into renewable chemicals will come on stream. We will soon launch electric ferries, paving the way for the decarbonisation of vessels in Singapore’s port. On top of these, we are installing nearly 5,000 electric vehicle chargers across Singapore in the coming years,” added the spokesman.

Shell said it remained committed to accelerate its transition and cut its own emissions from its operations by half in 2030, from 2016 levels. As it reduces production of traditional fuels in Singapore, including halving its crude processing capacity, it is developing plans to produce sustainable aviation fuel and to set up a carbon capture and storage hub, which would capture and safely store emissions for Shell and its customers in the region.

Shell last year announced it had upgraded facilities to supply sustainable aviation fuel at Seletar Airport and other customers, including SIA Engineering Company.

In November 2021, Shell announced plans to build the unit which improves the quality of pyrolysis oil, a liquid made from hard-to-recycle plastic waste that would have gone into a landfill, and turn it into chemical feedstock for its plant. Slated to start production this year, the unit at Shell’s manufacturing site on Pulau Bukom will be the largest in Asia and Shell’s first globally, with a capacity of 50,000 tonnes per annum. What it processes is equivalent to the weight of about 7.8 billion plastic bags.

The latest announcement does not impact these and other operations, including plans to build a new pyrolysis oil upgrader unit.

Singapore is one of Shell’s global hubs.

Its activities here include refining and petrochemicals businesses in Pulau Bukom and Jurong Island, lubricants manufacturing in Tuas, trading operations and a vast network of retail operations across the island.

“We will continue to work with the government and our customers on opportunities to meet their energy needs and to decarbonise, sector by sector,” the spokesman said.