BASF spends DM350m in new plants at Ludwigshafen, Schwarzheide

14 October 1999 10:40  [Source: ICIS news]

LONDON (CNI)--German chemicals giant BASF announced on Thursday plans to spend over Dm350m ($190m/Euro180m) in new production plants at Ludwigshafen and Schwarzheide, despite serious reservations about the burden of corporate taxation in Germany.

Due to come on stream in the second half of 2001, the new facilities will produce crop protection agents, paper chemicals and intermediate products. They will create 300 new jobs.

BASF said DM134m would be spent at Ludwigshafen on the development of its paper chemicals business and the expansion of its range of acetylenic alcohols.

The imine plant at Ludwigshafen will be extended to allow the production of a new group of paper chemicals additives, polyvinylamines (PVAm) which are manufactured from the monomer vinylformamide (VFA). BASF explained that the new facilities would have the capacity to produce 8000 tonne/year of VFA and 60 000 tonne/year of PVAm. Systems based on PVAm are used for strengthening paper and for removal of insoluble contaminants from the circulating pulp in paper production.

Ludwigshafen has also been chosen for a new plant to produce 2,5-dimethyl-2,5-hexanediol (DMHD), which is used mainly for the manufacture of 2,5-dimethylhexane-2,5-di-tert-butyl peroxide. This peroxide is used in the production of polypropylene and also plays an important role in the cross-linking of polyethylene.

Production of DMHD will be based on a process involving acetylene developed by BASF. Capacity of the new DMHD plant was not immediately available.

The paper chemicals and acetylenic alcohols developments will create 100 new jobs at Ludwigshafen. Last month BASF confirmed it was building a 20 000 tonne/year trimethylol propane (TMP) plant at Ludwigshafen, with completion scheduled for the beginning of 2001.

BASF said DM220m would be spent at Schwarzheide on facilities for the production of a new fungicide from the strobilurin class of active agents. It will be the second BASF production plant at Schwarzheide for a crop protection agent, and will create over 200 new jobs. A plant for the synthesis of epoxiconazol was brought on stream in 1995.

Main target markets for the new fungicide will be Europe, North and South America, said BASF which was unable immediately to give the planned production capacity of the new plant.

The new investment plans, however, were combined with a sideswipe at the federal government's tax policies. BASF board member and director of labour, Helmut Becks, said the decision to locate the new developments in Germany was not an easy one for the company to take give present uncertainties.

In a reference to the current debate among Germany companies about diminishing opportunities for tax write-offs, Becks said: "The change in what are known as the AfA (allowance for wear and tear) tables would result in conditional additional burdens for BASF and the whole of German industry and have a negative impact on investment decisions for an in Germany."

BASF added that despite these uncertainties "it trusts the pledges given by responsible German politicians to improve the economic framework conditions in our country in a sustainable way."

By: Neil Sinclair
+44 20 8652 3214

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly