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Review of Operations
10
LNG Projects
With demand expanding in the U.S., Europe and China, LNG projects are being planned and initiated
worldwide. As the leading engineering contractor for LNG plants, JGC participated in many Front End
Engineering and Design (FEED) jobs and construction projects during fiscal 2005.
JGC was awarded Yemen’s first-ever LNG plant project. The plant, for the Yemen LNG Co., Ltd.
will have two trains and an annual output of 3.35 million tons per train. The first train is scheduled for
completion at the end of 2008, followed by the second train in mid-2009. We were also awarded two
FEED jobs for LNG plants in Angola and Australia, and we plan to actively use these opportunities to
secure related construction work as well.
In Indonesia, we continued to work toward the scheduled completion of the Tangguh LNG plant for
BP Berau, Ltd. in the second half of 2008. This project is a major element of BP’s LNG strategy and
will also play a significant role in the development of Indonesia’s economy. When completed, this
important project will also cement Indonesia’s position as the world’s largest supplier of LNG.
In Nigeria, we completed
the fourth and fifth trains in
early 2006 at an LNG plant
for Nigeria LNG Ltd. We are
now working to finish train six
sometime in the second half
of 2007.
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JGC Corporation Annual Report 2006
Chemical Projects
The biggest theme for JGC in this field in fiscal 2005 was participation in national projects conducted
jointly by the Japanese petrochemical industry and oil-producing nations.
As already mentioned on page 4 in the “To Our Shareholders” section, and page 6 in the “Special
Feature 1” section, JGC won an order to construct core facilities for an integrated refining and
petrochemical complex, part of the Rabigh project currently being developed by national oil company
Saudi Aramco and Sumitomo Chemical. For Sumitomo Chemical, this is a groundbreaking project,
representing its first ever petrochemical facility located in an oil-producing region and heralding a new
stage in its global strategy. For Saudi Aramco, the project will diversify its operations by developing an
even wider presence in downstream-related areas. This national project also dovetails with Saudi
Arabia’s policy of stimulating domestic job growth. The project is scheduled for completion in the
second half of 2008.
Meanwhile, in China, we completed construction of a polycarbonate manufacturing plant for Teijin
Polycarbonate China Ltd. in May 2005. We are now working on the second phase of this project,
currently slated for completion in early 2007. In Japan, we finished an industrial gas manufacturing
plant in Ube City, Yamaguchi Prefecture, for Central Glass Co., Ltd. in October 2005.
Since the beginning of 2006, we have also completed a number of other facilities, including: an
ethylene plant for Shell Petrochemicals Co., Ltd. and China National Offshore Oil Corp. (CNOOC) in
China; a chemical plant for
PT. Trans-Pacific Petrochemi-
cal Indotama (TPPI) in Indo-
nesia; and a chemical plant
for EVAL Company of
America, a subsidiary of lead-
ing Japanese chemical firm
Kuraray Co., Ltd., in the U.S.
12
Power Generation, Nuclear Power
and New Energy Projects
In the new energy field, we achieved further major successes in the area of gas to liquids (GTL), which
is attracting attention as a source of clean energy.
In fiscal 2005, JGC was awarded a project management contract in Qatar for the world’s largest
GTL project, from Qatar Shell GTL Limited, a subsidiary of the Royal Dutch Shell. Since securing basis
of design and basic design package contracts for this project, we had been awarded a subsequent
FEED contract prior to the project management contract, giving JGC an extensive role in Royal Dutch
Shell’s GTL projects.
In the nuclear power field, Japan Nuclear Fuel Ltd. (JNFL) has been constructing a spent nuclear
fuel reprocessing facility in Rokkasho, Aomori Prefecture, since 1993. JGC has installed piping in the
active galleries of the facility, and testing is now under way prior to the planned start of operations in
August 2007. In power generation, we completed a power plant for the national oil company Saudi
Aramco in Saudi Arabia in June 2005.
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JGC Corporation Annual Report 2006
14
Catalysts and Chemical Products
Three key trends supported significantly higher sales of fluid catalytic cracking (FCC) catalysts,
hydrotreating catalysts and petrochemical catalysts — an increasing focus in the industry on heavy
oil, efforts to reduce environmental impacts, and the rising output of petrochemical feedstocks.
Chemical products, centered on fine chemicals, also continued their strong performance from the
previous fiscal year. As a result, revenues and earnings from catalysts and chemical products increased
overall compared to a year earlier.
In the catalysts business, sales of FCC catalysts — a product category where Catalysts & Chemicals
Industries Co., Ltd. (CCIC), a subsidiary of JGC, has captured the leading share in the domestic market
— and hydrotreating catalysts were firm in Japan and overseas. At the end of 2005, CCIC completed
their second FCC catalyst manufacturing plant to meet rising demand. Sales of petrochemical catalysts
were strong, supported by the rising domestic and international output of petrochemical products.
Sales of environmental catalysts, such as de-NOx catalysts, were also robust thanks to healthy demand
from the U.S.
In the chemical products business, vigorous investment in IT-related areas translated into firm sales
of semiconductor abrasive compounds and antireflective materials for flat-panel displays (FPDs).
Sales of optical materials, raw materials for cosmetics, and cathode materials for lithium ion recharge-
able batteries were also healthy. Steps were taken during the year to increase the manufacturing
capacity for FPDs antireflective materials and lithium ion rechargeable battery materials. In particular,
demand for antireflective
materials for FPDs, such as
LCD and plasma TVs, has
been growing dramatically,
with supply struggling to keep
up with demand. JGC
group’s increased output will
help to support further busi-
ness expansion.
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