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Shell Global Solutions sees chances in rising oil price

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Shell Global Solutions sees chances in rising oil price


Ika Krismantari, The Jakarta Post, Beijing

Spurred by soaring global oil prices, Shell Global Solutions (SGS), a subsidiary of Dutch oil giant Shell, will focus on developing advanced technology to boost economic benefits, its executives say.

Lee Tzu Yang, vice president of SGS, which provides technology and consultancy for oil firms, said the market had no other option but to boost efficiency to cope with increasing production costs triggered by high oil prices.

“That’s when the technology comes into play,” he said recently during the Asia Pacific Media Technology Day.

He said oil refineries around the world had to boost the efficiency of their processing units, including by refining low-cost, low-quality oil.

Low-quality oil is more difficult to process due to high contaminants levels, but recent technology breakthroughs have allowed manufacturers to extract greater profits.

SGS regional licensing manager for Asia Pacific Ken C. Lai said increasing global demand for diesel and propylene offered oil companies profit opportunities in refining low quality oil.

“Oil firms are increasing the value of their products even though they come from cheap raw materials,” Lai said.

SGS launched last week a new refining technology called Middle Distillate and Lower Olefins Selective (MILOS), which facilitates the conversion of low-quality oil into high-end petroleum products.

The launch of the technology also marked the expansion of SGS operations in Asia Pacific region.

Ken said by using MILOS, a company could save up to 15 percent in production costs.

Data from Shell shows demand for diesel from China and India will grow 30 percent and 135 percent respectively this year.

“(Those places) will experience the highest growth in energy demand,” Yang said, adding that aside from its existing service center in Malaysia, SGS was in the process of developing a technology center in Bangalore, India.

SGS’ clients in Southeast Asia include Indonesia’s state oil and gas firm Pertamina, Thailand’s PTT, and Malaysia’ Petronas.

SGS chief scientist for Chemistry and Catalysis Carl Mesters said demand for new technology to boost efficiency was expected to increase in line with rising oil prices.

“The more precious a thing is, the more you need to make sure you take care of it,” he said, adding that SGS was willing to spend a lot on research and development.



The company’s spending for research and development increased to US$1.2 billion in 2007 from $1 billion in 2006.


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