SINGAPORE : Japanese chemical and plastics giant Kureha Chemical is conducting a feasibility study on building a plastics production facility in Singapore.
The study could take up to a year, and if all goes well Jurong Island could be home to a new US$100 million plant.
Kureha is seeking to expand its production to meet an expected increase in demand.
Kureha is one of the world's leading makers of poly-pheny-lene sulphide resin, or PPS.
This resin is used in high-tech devices in the electrical, electronics, automobile and industrial sectors.
But demand is outstripping supply and Kureha sees a shortage in two to three years.
"Demand for PPS resin is expanding, averaging more than 10% a year. We need to meet growing demand. That's the reason we are going to expand production," Hiroshi Tanaka, President & CEO of Kureha Chemical Industry Co said.
Kureha plans to raise output at its existing plants in Japan and US by about 40% to 18,500 tonnes in three years' time.
But the company says that will still lag demand which is estimated to hit 50,000 tonnes by 2008.
So Kureha sees the need for a new plant, which will add another 10,000 tonnes annually to supply.
The company says it scoured the world before picking Singapore over other countries like China and Thailand.
Mr Tanaka said: "Singapore is a most attractive location for high-tech production because of world-class infrastructure, well-educated workforce, and conducive business environment."
And there is another plus point in Singapore's favour - it possesses key feedstock materials to produce PPS.
The feasibility study will take about one year.
And when completed, the plant is likely to employ some 100 workers.
"We have already done preliminary studies around the world. As a result, we have decided that Singapore is a most appropriate location for the construction of a PPS plant. That's why we are going to have a feasibility study here in Singapore," Mr Tanaka said. - CNA