Shale Gas Spawns Investments BASF Considers Building World–Scale Propylene Complex in the US

Editor: Dominik Stephan

German chemical giant BASF follows the gas boom: The company considers investing in a shale based propylene production on the US Gulf coast.

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BASF considers using US shale gas to produce propylene
BASF considers using US shale gas to produce propylene
(Picture: BASF)

Ludwigshafen/Germany – BASF is evaluating an investment in a world-scale methane-to-propylene complex on the U.S. Gulf Coast. “The production of propylene would allow us to take advantage of low gas prices due to shale gas production, considerably improve our cost position and improve our backward integration in the United States,” said Dr. Kurt Bock, Chairman of the Board of Executive Directors. This would be BASF’s largest single-plant investment to date. Propylene is one of the most important basic chemicals in the petrochemical industry and is used in the production of a wide range of higher-value chemicals. Details on the potential investment are currently under evaluation.

Good News for BASF from America

The company recently saw good sale sin North America due to the overall good economic situation: Sales grew by 9% in U.S. dollars and by 5% in euro terms. Sales volumes in the Petrochemicals and Catalysts divisions increased especially sharply. Besides currency effects, lower prices also reduced sales growth in the region. At €491 million, earnings surpassed the level of the first quarter of 2013 by €37 million thanks primarily to higher contributions from the Petrochemicals division and the Agricultural Solutions segment. “We had a good start to the year in our chemicals business and in the Agricultural Solutions segment. We sold more. This more than compensated for the negative effects on sales from the comparatively weak U.S. dollar and currencies in emerging markets,” Bock stated at the Annual Shareholders’ Meeting.