JV plants to cost billion$ Production of high-quality products in anticipation of tighter regulatory standards for industry and environment

31 Jul 2015

Last week, the joint venture between BASF SE and Petronas Chemicals Group Bhd, BASF Petronas Chemicals (BPC), announced plans to build two plants, including one for reactive polyisobutene (HR PIB), with an annual capacity of 50,000 tonnes, to be operational by the end of 2017.

HR PIB is a component for the production of fuel and lubricant additives, such as fuel detergents or dispersants for engine oils.

BPC managing director Dr Stefan Beckmann told StarBiz that the new plants’ investment could be to the tune of billions of ringgit based on earlier projects of similar scale.

He is confident that the chemical would be in demand in Asia due to increasingly higher standards for industry and the environment.

“Increasing environmental and regulatory standards will require higher performing engine oil and fuel, especially in the growth region Asia. HR PIB is an essential raw material to help industry players to fulfil such standards.

“The new plant will support the respective industry segments to achieve their objectives for sustainability,” Beckmann said.

In April last year, the company broke ground on its new integrated aroma ingredients complex, which would house facilities to produce citral, citronellol and L-menthol. With an investment amount of around RM1.5bil, the aroma ingredients produced would be used as flavours and fragrances for the food and beverage, fabric, homecare and personal care industries.

Recently, construction started on a 2-EHAcid plant with a total annual capacity of 30,000 tonnes. This plant is expected to be commissioned towards the end of next year.

Malaysian Investment Development Authority (Mida) chief executive officer Datuk Azman Mahmud said the investment would have tremendous impact not only on Pahang, but also other parts of Malaysia because it would provide potential business opportunities to supporting industries.

“This project is expected to create export revenue of RM300mil to the country as 100% of HR PIB will be for the export market,” he said.

Mida approved the establishment of the HR PIB plant in March.

BPC operates an integrated petrochemical complex located in Gebeng. Petronas Chemicals has a 40% stake in BPC, with the remainder held by BASF.

“The range of chemicals produced by BPC meets the growing demand in various industries including that of plastic, adhesives, lacquers, dyestuff, automobile and industrial coatings, paper, diapers, water treatment, textile and leather,” Beckmann said.

Source : StarBiz