BASF shelves plan to build coal gasification plant on uncertain emission costs
04.10.08, 4:11 AM ET
forbes.com
FRANKFURT (Thomson Financial) - BASF SE. has shelved plans to build a 1.5 billion-euro coal gasification plant due to uncertainty over the future costs of emission certificates, Frankfurter Allgemeine Zeitung reported, citing executive board member Eggert Voscherau.
'We don't know what we have to buy in terms of carbon dioxide certificates after 2012,' Voscherau said in an interview, adding that more reliable information is needed, given the useful life of about 30 years of such a plant.
The German government and the European Commission are in an ongoing tussle over how to handle the allocation of emission rights from 2013.
BASF (nyse: BF - news - people ) was planning to use the gas from the plant to produce methanol and ammonia, which are key chemicals for plastics, fertilisers and pesticides, Voscherau, who is BASF's deputy chief executive, said.
It is yet unclear whether the gasification plant will eventually be built in Ludwigshafen, where BASF is headquartered, should the company reconsider the investment at a later stage, Voscherau was cited as saying.
Uncertainty about the cost of emission rights is also paralysing investments in the utility, steel, cement and aluminium industries in Germany, the executive said.
'The entire industrial infrastructure is being called into question in Germany at the moment,' Voscherau said.
ludwig.burger@thomson.com
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