Mr Gan Seow Kee
Chairman and Managing Director of ExxonMobil Asia Pacific
Distinguished Guests, Ladies And Gentlemen
ExxonMobil and Singapore
1. I am happy to witness the opening of ExxonMobil’s third co-generation plant in Singapore. It is a significant addition to ExxonMobil’s Singapore Refinery and Chemical Plant, its largest integrated refining and petrochemical facility in the world, and will increase total co-generation capacity to 440 megawatts (MW), meeting nearly all of the facility’s power needs. The plant will also boost Singapore’s efforts to become a more energy- and carbon-efficient nation.
2. ExxonMobil and Singapore have had a long and fruitful partnership, which dates back more than 120 years, when ExxonMobil’s predecessor, the Vacuum Oil Company, sold kerosene and lubricants here.In 1966, one year after our independence, ExxonMobil set up its refinery and became one of our pioneer investors. The refinery now boasts a refining output of almost 600,000 barrels per day - more than 30 times when it first started. ExxonMobil is one of Singapore’s largest investors, with over S$20 billion in fixed assets. You have shared in and partnered us in Singapore’s economic and sustainable development path.
Singapore’s Sustainable Development Story and Tackling Climate Change
3. Since independence, Singapore has always pursued development on a sustainable basis, even before the term “sustainable development” became fashionable. Given our geographical limits and resource constraints, we believe that economic and sustainable development must be pursued together. Over the decades, even as we grew our economy, we actively greened our country, cleaned up our rivers, and enacted laws against pollution. This has transformed Singapore into a highly liveable and sustainable city. We were ranked the most sustainable city in Asia, and 2nd in the world, in the 2016 Sustainable Cities Index by Arcadis. But we cannot rest on our laurels as we are facing new sustainability and development challenges
4. Climate change poses a real threat to small island states like Singapore. Our 2015 National Climate Change Study showed that Singapore is very vulnerable to rising sea levels, higher temperatures, and extreme rainfall. Rising sea levels in particular, pose an existential threat to us. In the past two months, we saw the devastating effects of Hurricanes Harvey, Irma and Maria in the southern US and Central America. Scientists have warned that more intense weather phenomena can be expected as global temperatures continue to rise. These events are a stark reminder of why the world must take action now and stay committed to reducing carbon emissions.
5. Singapore contributes only 0.11 per cent of global emissions. We are already among the top 20 most carbon-efficient countries in the world. Nonetheless, we put forward an ambitious pledge in Paris to cut emissions intensity by 36% from 2005 levels by 2030, and to peak our emissions around the same time. There are two key reasons for this.
6. First, action on climate change is shared global responsibility.The Paris Agreement, and every pledge under it, is significant because all countries have collective ownership. As former UN Secretary-General Ban Ki-Moon said, “We have only one planet. There is no Plan B because there is no Planet B”. As a responsible global citizen, Singapore will do its part. Despite the uncertainties in global climate leadership after the US’s announced withdrawal from the Paris Agreement, Singapore will continue to work with other small states and major economies, and stay the course.
7. Second, enhancing our economic competitiveness. The future economy will be one where energy-efficient and low-carbon growth takes centre stage. The International Energy Agency (IEA)’s Energy Efficiency Market Report 2017 highlighted that global energy intensity improved by 1.8% in 2016. In financial terms, the world has reaped an “energy productivity bonus” of US$2.2 trillion, twice the size of the Australian economy – with China accounting for half of this. It is not surprising China is rapidly transiting towards a low-carbon economy. As the middle class grows and society becomes more prosperous, expectations rise. Sustainable development has become an important political imperative for China. In 2015, China invested over US$100 billion in renewables, up from just US$3 billion 10 years ago. China is set to implement its national greenhouse gases emissions trading scheme later this year. To stay internationally competitive, Singapore and our companies must position ourselves to stay ahead in this new and transforming global economy.
8. We amended the Energy Conservation Act this year to help industrial companies enhance energy efficiency through putting in place good energy management practices, and strengthening energy reporting requirements. We have announced plans to introduce a carbon tax and this will take effect from 2019. Revenue from the carbon tax will help to fund measures by industries to reduce emissions. In February this year, ExxonMobil Chairman and CEO Darren Woods said that the point of a carbon tax is to “promote greater energy efficiency and the use of today’s lower-carbon options, avoid further burdening the economy, and also provide incentives for markets to develop additional low-carbon energy solutions for the future”. My Ministry and other Government agencies have been consulting companies on the carbon tax. We have received useful feedback. We will be approaching the industry again soon to seek your views on the draft Carbon Pricing Bill, which will cover the implementation details of the carbon tax.
9. We are aware of industry concerns over the impact of the carbon tax on competitiveness, given that Singapore is an export-oriented economy. But precisely because Singapore is an open, globally connected and export-driven economy, our companies must stay ahead to stay competitive. The measures we are putting in place will facilitate Singapore’s transition to energy-efficient and low-carbon growth.
ExxonMobil’s Cogeneration Plant and Energy Efficiency efforts
10. I am pleased that ExxonMobil is already a leader in energy efficiency. ExxonMobil’s global refining operations have consistently been ranked in the top quartile by Solomon Survey since 2010. ExxonMobil Singapore’s operations are similarly doing well. Last week, I opened the 5th National Energy Efficiency Conference (NEEC), and gave out awards to deserving companies and individuals. ExxonMobil was a winner in the “Excellence in Energy Management” and “Best Practices” categories. Four innovative projects by ExxonMobil led to energy savings equivalent to taking 10,000 cars off the road every year. ExxonMobil has won awards in 2013 and 2016 as well – a testament to your strong commitment to continuous energy efficiency improvement.
11. I am also very encouraged to hear Mr. Gan mention that water conservation is deeply embedded in ExxonMobil’s DNA as well.
12. ExxonMobil’s third co-generation plant will translate to a significant 4-5% energy efficiency improvement in your operations, reduce carbon dioxide emissions by 265 kilo-tonnes and save S$14 million annually. It will build on the strong foundation that ExxonMobil has established in Singapore, and make the company even more competitive in the refining industry. These efforts are highly commendable. Singapore welcomes energy-efficient investors like ExxonMobil.
13. I encourage more companies to seize energy efficiency opportunities. The benefits are immense. Companies that take action now to reduce energy consumption and greenhouse gas emissions will lead in international competitiveness and future resilience.
The Way Forward
14. Today, Singapore has an economically vibrant city that is clean, green and liveable. This is the result of integrated planning, good policies and effective implementation. Despite Singapore’s severe constraints, such as energy, water and land scarcity, we have worked to transform constraints into strengths, underpinned by our belief that economic and sustainable development are one and must be pursued holistically.
15. I thank ExxonMobil for partnering us in our sustainable development journey over the years, and for inviting me to officiate at the opening of this plant.
16. Thank you.