BASF and Petronas Chemicals Group Berhad (PCG) intend to invest US$500 million (MYR 1.5 billion) in an integrated aroma ingredients project as part of their existing joint venture BASF Petronas Chemicals in Gebeng, Kuantan. With this investment, the partners will help meet the globally growing demands of customers in the flavor and fragrance industry, especially in Asia Pacific.
At the heart of the complex will be a plant for citral and precursor plants. The partners will also invest in downstream production for aroma ingredients including a new world-scale plant for L-menthol and a plant for citronellol. Production will be developed in phases, with the first plants of the project operational in 2016, creating some 110 new employment opportunities.
“With this strategic investment we are increasing our contribution to the aroma ingredients market to bring attractive fragrances and flavors to our daily lives. Embedding this investment into our Kuantan Verbund allows our customers to benefit from a global production network for their future growth plans in the Asia Pacific region,” said Saori Dubourg, President Asia Pacific, BASF.
Datuk Wan Zulkiflee Wan Ariffin, Chairman of Petronas Chemicals Group Berhad, added that the integrated aroma chemicals complex will open up a new business frontier for PCG, tapping into the flavors, fragrance and pharmaceuticals markets.
BASF and PCG founded their joint venture BASF Petronas Chemicals Sdn Bhd in 1997. The company currently operates an integrated complex situated at the Gebeng Industrial Zone, Pahang. The company’s share capital is 60% held by BASF and 40% by PCG with a total initial investment of about MYR 3.4 billion for acrylic monomers, oxo products and butanediol production facilities.In the new project, the partners will invest according to their stake.