BASF Agrees Strategic Partnership in Russian Petchems

With the signing of a long-term agreement to cooperate with Russia's biggest polyethylene producer, Kazanorgsintez, BASF has gained a firmer toehold in that country's petrochemicals sector.

Under the deal, the German chemical giant will supply plastics additives to its Russian partner and provide technical support for its HDPE production.

The two groups also intend to form production joint ventures to extend the Kazanorgsintez branded additives portfolio and apply "most modern stabilizer solutions." No details or projected capacity have yet been provided.

With an eye to the future, the prospective partners BASF and Kazanorgsintez said they will cooperate closely on analyzing the requirements of Russian plastics converters and providing the additives to match.

Sergej Andreyev, head of BASF's Russian operations, said the German group, world's largest chemical producer; has a "strategic interest in the development of the polymer industry in Russia." Together with local partners, it is "prepared to do its part to build up capacities for higher value-added products," he said.

Although BASF is an important Western player in the Russian gas market, it has been slow to move into the petrochemicals markets. There are signs that this may be changing, analysts have said.