28 June 2001 15:32 [Source: ICIS news]
LONDON (CNI)--Basell, the 50:50 polyolefins joint venture owned by BASF and Shell, has abandoned plans to build a 600 000 tonne ethylene cracker in India in equity partnership with Indian petrochemical company Nocil (National Organic Chemical Industries Ltd).
In announcing on Thursday the pull-out, a Basell spokesman denied any link between the project's cancellation and last week's announcement by BASF of a profits warning and 20% reduction in capital spending. He attributed the decision entirely to a combination of worse than expected trading conditions for polyethylene (PE) and polypropylene (PP) resulting in the failure to sign up further equity funding for the proposed joint venture with Nocil following the expiry of an initial memorandum of understanding (MoU).
The proposed cracker at Thane, Maharashtra state was to have come onstream towards the end of 2003 with a cost initially put at just over $1bn (Euro1.2bn).
Although Basell declined to make any statement on the projected cost of its involvement in the project, it is understood that it had would have been left with a 75% equity holding in the Indian joint venture - some of which it was seeking to off-load to a third party company without success.
Basell said that it had no current plans to set up a replacement production facility for the failed project.
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