BASF approves investment in €10bn world-scale Chinese chemicals complex

BASF has approved the construction of the core of its €10bn (US$10bn) integrated chemicals site in Zhanjiang, China. The huge complex will become the German company’s third-largest site worldwide after Ludwigshafen in Germany and Antwerp in Belgium.

In 2020, BASF started construction of the initial phase of the Zhanjiang site in Guangdong in the south of the country. This included an engineering plastics compounding plant and a thermoplastic polyurethanes (TPU) plant which are expected to begin operations this year and next. Its latest approval is for €10bn worth of investment by 2030 in what the chemicals major describes as the core of its integrated plant – or Verbund plant – which includes a mixed-feed steam cracker that can use butane or naphtha to produce 1m t/y of ethylene.

When fully operational in 2030, the plants will stretch over a site measuring 9 km². The ethylene will be fully consumed to produce ethylene oxide and ethylene glycol as well as 500,000 t/y of high density polyethylene (HDPE), marking its first foray into the market. In an investor briefing last year, BASF Director Markus Kamieth said local demand for HDPE offered a competitive setup for the Verbund plant. Propylene will be processed into acrylics and oxo-alcohols. While the C4 value chain will be processed into downstream petrochemicals including diisobutene, and chemicals for nutrition and health sectors, including citral.

BASF has set targets to be net zero globally by 2050. Measures to reduce emissions at its Zhanjiang site include powering the site with 100% renewable electricity from 2025; using electricity-driven rather than steam-driven turbines for compressors in the cracker; and using excess steam to preheat air in the cracker furnaces to increase system efficiency.

Separately, the company has announced it will invest US$780m in the final expansion phase of its methylene diphenyl diisocyanate (MDI) plant at its Verbund site in Geismar, Louisiana, US. MDI is a raw material for polyurethanes, foams and adhesives. The first phase involved construction of a new MDI synthesis unit which began operations in 2020. The second phase involved expanding several existing upstream units and began operations in 2021. The third and final phase includes constructing new upstream units and a splitter. Taken together the three phases will double output to 600,000 t/y once fully operational by the end of 2025.