German chemicals giant BASF SE (OTC:BASFY) inked a deal with ENN Energy Holdings Limited (OTC:XNGSY) to purchase natural gas for its Zhanjiang Verbund site in China.
As per the contract, ENN Energy will invest in the construction of the needed supporting natural gas gate stations and pipelines to aid a stable natural gas supply to BASF's Zhanjiang Verbund site.
The Zhanjiang Verbund site will be BASF's largest investment to date with around €10 billion upon completion.
The deal will also further boost the clean energy supply capabilities of Donghai Island in the Zhanjiang area.
Marko Murtonen, Senior Vice President, New Verbund Site China, BASF & General Manager, BASF Integrated Site (Guangdong) Co. Ltd said, "This is a crucial milestone for BASF to secure one of the essential energies required for our Zhanjiang Verbund site. As one of the important fuels and raw material sources, natural gas plays a significant role in the energy and raw material balance for BASF's Zhanjiang Verbund site in both its construction phase and operation phase."
"We are delighted to successfully establish this long-term partnership with ENN Energy. BASF is dedicated to building our Zhanjiang Verbund site as a role model of sustainable production. We are convinced that this partnership will not only benefit both parties but also contribute to building the Donghai Island into a world-class industrial cluster for a joint sustainable future of Zhanjiang."
Last month, BASF broke ground on a methyl glycols (MG) plant at its Verbund site in Zhanjiang, China.
Price Action: BASFY shares are down 0.61% at $14.57 on the last check Friday.
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