China and Brunei get down to business
Joint efforts made to build series of landmark projects, including refinery complex, bridges, highway and dam
Two years ago, the tiny island of Pulau Muara Besar, which lies off the northern tip of Brunei in the South China Sea, was nothing but a wilderness.
Today, the island is abuzz with more than 10,000 workers from China, Bangladesh, Indonesia and other countries. A refinery and petrochemical complex, jointly invested by China’s privately-run Hengyi Group and the Brunei government, is starting to take shape.
When it is completed next year, the first phase of the $3.4 billion complex will have the capacity to refine 175,000 barrels of crude oil per day. It is Brunei’s largest-ever foreign investment project and the biggest single overseas investment by a Chinese private company.
The complex, listed by China as a key project for the Belt and Road Initiative, also represents efforts by Brunei, a member of the Association of Southeast Asian Nations, to partner with Chinese businesses to diversify its sources of income and further improve infrastructure.
Chinese companies have also been involved in the construction of other landmark projects in Brunei such as the Pulau Muara Besar Bridge, the Telisai-Lumut Highway, the Ulu Tutong Dam and the Temburong Bridge, and their presence has been more than welcomed locally.
“China has the expertise to assist countries that do not have this kind of know-how for mega projects. And people in Brunei are benefiting because of that,” said Ahiraj Tyagi, project coordinator for a joint venture between China State Construction Engineering Corp and a Brunei company that is building a section of the 30-kilometer-long Temburong Bridge.
“If we were to do projects like this on our own, the cost would be much higher, and a two-year project would become a seven-year one. Chinese companies have huge experience worldwide, and they bring this when they come to work here,” said the Indian national, who has lived and worked in Brunei for 25 years.
Diversified economy
For Brunei, the arrival of Chinese companies is coupled with efforts to diversify its economy and improve infrastructure.
Before his state visit from Nov 18 to 20, President Xi Jinping said in a signed article in local newspapers that more and more Chinese companies are making investments and doing business in Brunei, contributing to the diversification of its economy.
He said China will continue to help Brunei in this respect, ensure the success of key joint projects and explore possible cooperation in areas such as energy and infrastructure.
Brunei’s oil and gas reserves are expected to run out within two decades. The country’s economy posted negative growth of 2.8 percent yearon-year in the second quarter, dragged down by slowing oil and gas production, according to Xinhua News Agency.
Hengyi Group said that when it is completed, the first phase of the refinery and petrochemical complex alone is expected to contribute as much as 40 percent to Brunei’s GDP.
The second phase of the project will expand the refinery capacity to 281,150 barrels per day, and includes building units to produce 1.5 million metric tons of ethylene per year and 2 million tons annually of paraxylene, the company said on its website.
Zuo Xueqiang, an executive with the company, which is headquartered in Hangzhou, capital of Zhejiang province, said, “It (the project) is a win-win in many respects.”
He said the complex on Pulau Muara Besar has provided a platform for Chinese companies to expand their operations in Brunei, as the project also requires the development of support facilities. These include plants for power generation, water supply and waste water treatment, and a port, which have been contracted to a number of Chinese companies.
“It (the island) was an absolute wilderness two years ago. Even the sand we are now standing on was shipped in from Hainan province (in South China),” Zuo said.
He added that construction of the project is only a first step, and more challenges lie in the operations, as petrochemical projects involve high risks.
The project has prioritized participation from locals, and will be jointly managed by the company and counterparts in Brunei, he said.
More than 60 percent of the project’s workers will be locals, starting from the eighth year of operation, according to agreements signed between the company and the Brunei government.
As part of efforts to help with training local talent, the company has launched programs with Zhejiang University, which has catered to 68 undergraduates from Brunei working in the petrochemicals sector.
Wang Wenke, manager of the power plant project for the complex, said nearly half of the 300 workers employed on this are from Southeast Asia, and the others are from China. “For Chinese businesses, it is important to employ overseas workers in projects abroad to control costs,” he said.
It has been common practice for Chinese workers, who are generally more experienced and skilled, to work together with local workers to ensure the quality and efficiency of projects, he said.
“We bring with us Chinese management and technology for projects like this, and we try our best to leave employment opportunities for local people,” Wang said.
The strong Chinese presence in Brunei is also evident in another landmark project, a bridge connecting the country’s main region with the forested enclave of Temburong. Located on the island of Borneo, Brunei has two main regions that are separated by Sarawak in Malaysia.
In dense rainforests and alongside tropical swamps, employees from China, Bangladesh and Southeast Asian countries battle scorching temperatures and high humidity as they work in three shifts a day, totaling at least 18 hours, to ensure the bridge project is completed before November.
Contract packages
The huge project was divided into six contract packages, with the one covering the sea crossing awarded to the Brunei-South Korea joint venture Daelim Swee. A joint venture between China State Construction Engineering Corp and Ocean Quarry & Construction was responsible for building a viaduct through the rainforests in Temburong.
For Amirah Hajiarun, construction of the Temburong Bridge provided her with a job after she graduated five months ago. It also will bring her family closer.
The 27-year-old from Brunei, who is a quality inspection worker at the China-Brunei joint venture, said that even though she lives with her parents in Bandar Seri Begawan, the capital, her father still has siblings who live in Temburong.
“We only meet during major family events, such as marriages or funerals,” she said.
Passengers traveling between Bandar Seri Begawan and Temburong now have to rely on a 45-minute water taxi ride, or drive for two hours through Malaysia, which involves border entry and exit procedures.
“It is really inconvenient, because the water taxis only run during the day and the border control offices are only open at certain times,” she said.
Next year, the Temburong Bridge will change all this by connecting the forested enclave to mainland Brunei. Once built, it will reduce the journey time by car to 20 minutes.
Hajiarun said: “Working on this project gives me tremendous pride. Everyone in my family is really excited. Since I started working here, they keep asking me when the bridge will be completed.”
Ahiraj Tyagi, project coordinator for the joint venture, said the Chinese company won the contract because of its competency and good track record.
He also described the Temburong viaduct as a “unique project”.
“There was no means of access to reach the work site. The preparatory work was far greater than the actual work we have done,” he said.
“There were no roads in the rainforest. The bay area where we had to start our work was very shallow, and we had to dredge a river just to reach the site. You could not even walk to the place.”
The strict environmental standards imposed on the project by the government in Brunei also made it even more challenging, Tyagi said.
“Before we started, we had to get clearance from all departments. Whatever we needed to do, we had to submit documents, such as statements showing how we were going to do the work, whether it would affect the environment, and if so, we had to outline mitigation methods,” he said.
Tyagi added that work was proceeding on the bridge structure, rather than on the ground, to minimize the environmental impact.
“If you compare the project to building a house, we are constructing the roof first and then the rest. The nature of the work makes it difficult,” he said.
To ensure the project is completed on time, the Chinese company and its partner in Brunei decided to start the work on different fronts. “It is like doing different projects in one go. It requires duplicating four sets of machinery, four sets of manpower and four sets of accommodation,” Tyagi said.
Rather than building the bridge from scratch, the company decided on a plan for a panelized structure made in China, and then assembled on site.
This project also employs workers from a variety of nations.
“It’s like a cultural melting pot here. Despite the differences in language, culture and dietary habits, teamwork keeps us together. The main aim of all the people here is to make this project happen. Everybody is focused on getting the work done,” Tyagi added.
Catalyst for change
Similar to the refinery and petrochemical project on Pulau Muara Besar Island, the Temburong Bridge also carries Brunei’s hopes of diversifying its economy. Falling oil prices in recent years have led to a new focus on tourism, and local travel agencies are eagerly looking forward to the bridge being completed.
Leslie Chiang, the founder of Brunei tour company Borneo Guide, in addition to the Sumbiling Eco Village, said, “More people will visit Temburong and the rainforest, and will be able to enjoy more activities without worrying about dashing to catch a water taxi.”
She added that in recent years her company has seen a major increase in the numbers of Chinese tourists.
“Also, the increase in Chinese businesses in Brunei has helped local ones to grow, creating more jobs,” she said.
Chiang added that the bridge will soon be an attraction itself. “It will be stunning if you drive on it either during sunset or sunrise. I cannot wait to see the view from the bridge,” she said.
Meanwhile, more Chinese service providers are eyeing growth in Brunei.
Zhang Tao, CEO of Yeebee, a Chinese business-to-business services provider, said the company is targeting more expansion in Brunei to tap the potential of the service sector by linking local suppliers with those in China.
Zhang, who visited Brunei last month to promote his company’s services, said more than 20 local businesses have signed up. “In the future, we foresee more demand for highend consumption here, especially in education, tourism, medical care and financial services,” he said.
He added that the growing presence of Chinese businesses in Brunei may see a demand for financing services, which could be met through cooperation between institutions in both countries.
Tyagi, the coordinator, said infrastructure projects such as the Temburong Bridge could be catalysts for “an array of changes”.
“Previously, there was hardly any economic development in Temburong. The number of people staying there has been falling. The younger generation, because of the lack of opportunities, is moving to downtown areas,” he said, adding that Temburong is underdeveloped largely because of a lack of convenient access.
“With the bridge, Temburong can have its own economy. It will enable better transportation of goods and manpower. Once the number of people rises, infrastructure will grow accordingly,” he said.
It’s like a cultural melting pot here. Despite the differences in language, culture and dietary habits, teamwork keeps us together.”
Ahiraj Tyagi, project coordinator