BASF, Sinopec mull second steam cracker in Nanjing, China

SINGAPORE (ICIS)–Germany’s BASF and China’s Sinopec are looking at constructing a new steam cracker in Nanjing, to further strengthen their partnership in upstream and downstream chemical production in China, the companies said in a joint statement on Monday.

From left: Sinopec chairman and president Dai Hou-Liang and BASF chairman Martin Brudermueller at the MoU signing in Beijing. (Source: BASF)

The cracker will have a 1m tonne/year ethylene capacity.

The two companies have signed a Memorandum of Understanding (MoU) in Beijing on the project and the planned expansion of their 50:50 joint venture, BASF-YPC.

Under the MoU, BASF-YPC and Sinopec Yangzi Petrochemical (YPC) will each invest in a 50% stake on the steam cracker.

A joint pre-feasibility study on the project will be concluded by the end of 2018.

“The basic chemicals provided by the new steam cracker enable BASF and Sinopec to expand production capacity at BASF-YPC, their existing integrated joint venture “Verbund” site in Nanjing, the companies said.

BASF-YPC currently operates a cracker with a 740,000 tonne/year ethylene capacity at Nanjing in China’s Jiangsu province, according to the company’s website.

BASF-YPC petrochemical complex in Nanjing, China (Source: BASF)

The Nanjing site currently produces around 3m tonnes of chemicals and polymers each year. In 2017, the joint venture company generated sales of about Chinese yuan (CNY) 21bn.

“This additional investment into a new steam cracker and the expansion of our BASF-YPC joint venture in Nanjing underline the strong partnership between Sinopec and BASF and the commitment to our customers in China,” BASF chairman Martin Brudermueller said.

“With the strengthened cooperation between Sinopec and BASF, we will provide high quality chemicals … We aim to create further value by extending this partnership,” Sinopec chairman and president Dai Hou-Liang said.

The partners are also jointly exploring new business opportunities in battery materials.

“The rising importance of alternative energy in China, especially in the automotive industry, has led to a surge in demand for innovative battery materials for a range of applications,” BASF and Sinopec said.

Additional reporting by Pearl Bantillo

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