Downstream Diversification Real or Imaginary?

Transcription

1 THE NATIONAL BUSINESS CONFERENCE 2005 ASIAINC FORUM - 27 APRIL 2005 Downstream Diversification Real or Imaginary? John Perry, Chief Executive Officer The Brunei Economic Development Board

2 Brunei Aluminium to contribute 2% to Brunei s GDP HIGHLIGHTS? Smelter to create 1,000 jobs at start-up 4,000 indirect jobs envisaged Financial close in Q4 of 2006 Second pot line to be added EPC bids for 800MW power plant by April Saturday, July % of the estimated 1,000 direct jobs envisaged at start-up will be set aside for Bruneians a figure set to rise to 60% of the workforce after five years.

3 Wednesday, March Sohar Aluminium to contribute 2% to Oman s GDP Smelter to create 1,000 jobs at start-up 4,000 indirect jobs envisaged Financial close in Q4 of 2005 HIGHLIGHTS Second pot line to be added EPC bids for 800MW power plant by April 35% of the estimated 1,000 direct jobs envisaged at start-up will be set aside for Omanis a figure set to rise to 60% of the workforce after five years.

4 Saturday, July Aluminium Brunei s New Economic Stimulus? HIGHLIGHTS Six spin-off industries established: Aluminium Powder & Pellets Extruded Parts Wires & Cables Flat Sheet Products Wheel Alloy & Fabricated Wheels Alloy Metal Total annual contribution of US$560m to economy Smelter employs 2,770 workers (87% local) Spin-offs employ 1,883 workers (90% local)

5 Saturday, Monday, April July Aluminium Impact of Aluminium Brunei s Industry New Economic Bahrain s Stimulus Economy HIGHLIGHTS Real? Imaginary? Six spin-off industries established: Aluminium Powder & Pellets Extruded Parts Wires & Cables Flat Sheet Products Wheel Alloy & Fabricated Wheels Alloy Metal Total annual contribution of US$560m to economy Smelter employs 2,770 workers (87% local) Spin-offs employ 1,883 workers (90% local)

6 Business Development Concept Create Opportunities

7 Opportunity Knocks Projects Status Potential Investments (US$ Million) Potential Jobs Total Investment FDI HMG Direct Indirect Total Jobs Ammonia/Urea Finals Methanol Finals Aluminium Smelting MOU 1,500 1,500-1,000 4,000 5,000 Elastomers MOU 1,820 1,820-1,220 3,500 4,720 Total 4,415 4, ,555 8,400 10,955

8 Ammonia/Urea Plant (Incitec/MC/Westside) MOU Final Investment Decision (FID) Build & Commission Methanol Plant (MGC/Itochu) MOU Final Investment Decision (FID) Build & Commission Aluminium Smelting (Alcoa) MOU Final Investment Decision (FID) Build & Commission Elastomers (ACI) MOU Final Investment Decision (FID) Plant 1 - Build & Commission Plant 2 to 4 - Build & Commission Opportunity Schedule Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Activity Duration Critical Deadline Production Deadline Gas Requirement Estimated 2.5 TCF

9 BEDB s s Gas Requirements MM cubic metres per day Estimate of gas production for domestic power Estimate of gas production for LNG BEDB s 2.5 TCF Benefits Envisaged -Investment US$4.5b -2,500 Direct Jobs -8,400 Indirect Jobs Years Ammonia/Urea Methanol Aluminium 1 Elastomers 1 to 4

10 Real Opportunities Sectors Transportation Finance Trade Personal Services Business Services Packaging Tourism Freight Movement; People Movement; Logistics; Distribution Banking; Insurance Agents & Brokers Building Materials; General Merchandise; Automotive Dealers Doctors; Dentists; Nurses; Teachers; Cosmetic; Food Stores Engineering; Accounting; Architecture; Real Estate Boxes; Sacks; Plastics; Bags Hotels; Apartments; Travel Agents; Tour Guide; Restaurants

11 Real Spin-Offs Products Ammonia / Urea Methanol Aluminium Elastomers Potential Spin-Off Industries Pharmaceuticals; Corrosion Inhibitors; Resins; Paper Laminates Agricultural Chemicals; Disinfectants; Adhesives; Coatings; Fibre Reinforced Plastics Aluminium Foil and Cans; Reflector Sheets; Roofing Sheets; Vehicle Bodies, Frame Components & Wheels; Computer Parts; Wires & Cables Tyre Production; Conveyor Belts; Mechanical Rubber Goods; Wire & Cable Jackets; Seals; Injection Moulded Products; Rollers; Belts; Hoses

12 Spin-Offs from Methanol Project Main Derivatives DME (Dimethylether) Formaldehyde Paraformaldehyde MMA (Methyl Methacrylate) Methylamines Acetic Acid Formic Acid Neopentyglycol Trimethylolalkanes Pentarythritol Aerosol Propellant, Refrigerant ( Green Substitute for CFCs) Glue for Plywood/MDF, Urethane Plastics, Preservatives Polyacetal (for making Hi-tech Plastics), Disinfectant, Fungicide House Paint, Acrylic, Pulp Paper Production Pharmaceuticals, Fuel Additive, Insecticides, Photographic Agent Raw Material For Plastics (E.g. Rayon, Photographic Films) Textile Dyeing, Leather Tanning, Solvent For Perfumes/Food Flavoring Polyesters (Textile) Uses MTBE Substitute for lead in unleaded petrol (BSP uses this to produce unleaded petrol for sale in Brunei Darussalam) [RED] Products available for licencing from MGC

13 Managing the Environment There are NO issues that cannot be managed to meet Brunei s environmental standards. An Environmental Impact Assessment (EIA) for each project using World Bank Standards An Environmental Management Plan (EMP) to cover the project life

14 Seizing the Opportunity Cooperation Agreement Human Resource Development Small and Medium Enterprise Development Spin-Off Industries Development Quantifiable Objectives

15 Critical Success Factors Capacity Conviction Courage

16 Wednesday, March 9, 2005 Sohar Aluminium to contribute 2% to Oman s GDP Smelter to create 1,000 jobs at start-up 4,000 indirect jobs envisaged Financial close in Q4 of 2005 HIGHLIGHTS Second pot line to be added EPC bids for 800MW power plant by April 35% of the estimated 1,000 direct jobs envisaged at start-up will be set aside for Omanis a figure set to rise to 60% of the workforce after five years.

17 Wednesday, Saturday, March July 15 9, Sohar Aluminium BruAl to contribute 2% to Brunei s Oman s GDP Smelter to create 1,000 jobs at start-up 4,000 indirect jobs envisaged Financial close in Q4 of HIGHLIGHTS Second pot line to be added? EPC bids for 800MW power plant by April 35% of the estimated 1,000 direct jobs envisaged at start-up will be set aside for Bruneians a figure set to rise to 60% of the workforce after five years.