25 March 2002 21:03 [Source: ICIS news]
SAN ANTONIO, Texas (CNI)--Shell Chemicals remains very committed to Basell, its loss-making polyolefins joint venture with Germany's BASF, CNI was told here on Monday.
Fran Keeth, president of Shell Chemicals LP, admitted in an interview on the sidelines of the annual International Petrochemicals Conference (IPC) that Basell has significant problems.
"But we're working very hard together with BASF to improve," she said.
"We're really committed to Basell and I don't want any doubts in anyone's minds, whether its investors, partners, employees or any other stakeholders."
At Shell's analysts' briefing in December, the joint venture was identified as part of the group's $7bn (Euro8bn) of poorly performing assets. This led to question marks being placed against Shell's long-term commitment to Basell.
But Keeth stressed that Basell was a major part of Shell Chemicals' future. "If we're going to have big crackers we need to have an offtaker that we have a relationship with."
She said Basell's problems were being addressed. "We need to take cost out and shut in capacity - all things that Basell is doing."
Keeth pointed out that Basell had disposed of non-core operations and had reduced by about 30% the number of polypropylene (PP) and polyethylene (PE) grades that it sells. It had, more importantly, embraced the fundamental concept that commodity companies have to be low cost companies.
Keeth expressed confidence in the ability of Basell president and chief executive Volker Trautz to turn the company around.
The IPC, which is sponsored by the National Petrochemcials & Refiners Association (NPRA), concludes Tuesday.
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