"You'll probably see the installation of hydrogen systems in 2003, with the construction one year ahead of the introduction of the vehicles, which could be 2004," said Gary Oliver, hydrogen market development manager at BP.

Oliver said BP plans to install hydrogen refueling facilities, which cost between $500,000 to $1.5 million each, in one or two of its existing retail outlets in Singapore.

"For this pilot project we're targetting about two refueling stations to serve maybe 15 cars or so," he said.

Oliver said while the initial stations will be costly and serve only a few vehicles, the price of installing hydrogen refueling stations should decline as more are built.

The next step in the project will be to conduct a feasibility study on the Singapore market, BP executives said.

BP in March launched a similar project in the United Kingdom.

"We think that in 20 years the internal combustion engine could be obsolete," said Koh Kim Wah, president of BP Singapore.

He said while this project is focused on vehicular use of hydrogen, this fuel could also be used for power generation and other energy needs in the future.