SINGAPORE (Reuters) - German chemicals giant BASF on Thursday said it had selected the port city of Zhanjiang in the southern Chinese province of Guangdong as the site for its $10 billion petrochemicals complex.
The company had previously said that the facility, China’s first wholly foreign-owned chemicals complex, would be in the province without giving the exact location. [nL1N1U604Z]
China is allowing greater access to its massive chemicals markets for global majors and local independents as it looks to feed fast-growing demand for plastics, coatings and adhesives from industries such as consumer electronics.
“By 2030, China’s share of global chemical production will increase to nearly 50 percent,” BASF Chairman Martin Brudermüller said in a statement issued on Thursday.
“Guangdong is a growing market for innovations from chemistry, and our new site will support customers in multiple industries.”
The company on Wednesday signed a so-called ‘framework deal’ taking the project beyond the ‘memorandum of understanding’ that was previously agreed.
The $10 billion will be invested in phases including building a 1 million tonne-per-year steam cracker and several plants for consumer-oriented products, BASF said.
A 9 square-km plot of land will be allocated for the project.
The move comes after BASF in October signed a memorandum of understanding with China’s Sinopec Corp to build a steam cracker in the eastern city of Nanjing, where the firm started its first major investment in the nation nearly two decades ago in a tie-up with the Chinese state energy firm. [nL3N1X91ZH]
Reporting by Chen Aizhu; Editing by Joseph Radford