BASF has announced that the first plants to be built at its proposed integrated site in Zhanjiang, China, will be an engineering plastics compounding facility as well as a thermoplastic polyurethane (TPU) production unit.

The compounding plant will add 60,000 t/y to BASF’s engineering plastics compounds capacity in China when it starts up in 2022, taking the German group’s total production in Asia-Pacific to 290,000 t/y.

BASF will also build general facilities for the site along with the two plants. The company has established a new wholly owned subsidiary – BASF Integrated Site (Guangdong) – to oversee the site’s operations.

“We want to improve our support for customers in the southern China market and around the world. We will do this by establishing the new plants close to growing customer industries, and through improvements in efficiency realized from our smart manufacturing approach. This will increase our speed of innovation and the efficiency of our services,” said Raimar Jahn, president of BASF’s Performance Materials division.

Jahn added that electric and electronics companies and automotive manufacturers are seeking help from BASF in areas such as the electrification of cars and miniaturization of electronic devices.

The Zhanjiang site, which will include a steam cracker and various downstream plants, will be BASF’s largest investment, at an estimated cost of up to $10 billion on completion. The complex is expected to be fully completed by 2030.

BASF said the site’s integrated value chain will connect upstream and downstream plants from basic chemicals to more consumer-oriented products and solutions, serving growth sectors such as consumer goods or transportation.

BASF signed a Memorandum of Understanding for the site with the Guangdong government in July 2018. This was followed in January 2019 with the signing of a framework agreement setting out further details of the project.