BASF Builds Manufacturing Plant for Chemical Construction in Panama

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Researched by Industrial Info Resources (Sugar Land, Texas)--BASF Construction Chemicals LLC (Cleveland, Ohio), a leading global supplier of construction chemicals and a division of BASF Corporation (Florham Park, New Jersey), which in turn is the North American subsidiary of BASF SE (OTC:BASFY) (Ludwigshafen, Germany), the world's largest chemical company, has announced plans to set up a manufacturing facility in the Republic of Panama. The facility is expected to be ready for operations by the fourth quarter of 2010.

With the establishment of the plant, BASF aims to expand its production and global service network. The company foresees immense potential for growth and development in Panama, and the plant is expected to help the company meet demand for construction chemicals in the country. The facility will have local production abilities, and the company will staff it with competent sales and development personnel to ensure fast and efficient service to customers. John Salvatore, who is head of BASF Construction Chemicals, North America said, "We look forward to being the first Construction Chemical company to establish a manufacturing plant in Panama."

Construction chemicals describe a wide range of chemical products that are used in the pre- and post-construction phases of a project. They are used as an additive to mortar or concrete, or as an application on masonry surfaces to enhance the properties of concrete in a fresh and hardened state. The construction chemicals sector is largely divided into admixtures, flooring compounds, rehab and repair, and other services. The Admixture Systems division of BASF Construction Chemicals caters to customers from the manufactured concrete, pre-cast concrete, ready-mix concrete, and underground construction sectors. The company's Construction Systems division offers a wide range of products such as flooring solutions, wall systems, expansion joints, wood protection, concrete repair and protection, crack repair and injection resins, joint sealants, grouting and anchoring systems, waterproofing, and tiling. The company has a business presence in more than 50 countries worldwide.

The ongoing $5.25 billion Panama Canal expansion project or the Third Set of Locks Project is set to double the existing capacity of the Panama Canal by 2014-15. Bigger ships and a higher number of ships will be able to sail on the canal waters. With the third set of locks in place, the canal is expected to manage traffic beyond 2025. The plan was proposed in 2006 under the leadership of the then-President Martín Torrijos of Panama. The Panama Canal Authority (ACP) (Panama City, Panama), an autonomous agency of the Panamanian government, is implementing the canal expansion.

The canal already has two lanes with their own set of locks. Under the expansion program, a third lane will be added by constructing new lock complexes at each end of the canal, one on the Pacific side and one on the Atlantic side. New access channels to the locks will be excavated, while the existing channels will be widened and deepened.

A strong economic recovery in the U.S. and Latin America is proving to be beneficial for Central America's export sector. The region also stands to benefit from an increasing interest from the private sector in infrastructure development projects; easier access to multilateral loan facilities; and project finances. The region's strategic location, and the fact that it is still a largely unexplored area for global investors, holds promise for global trade. The increasing interest of institutional investors in emerging markets is expected to continue, and Central America is poised to benefit from this interest.

Panama, Guatemala and Costa Rica are three Central American nations where foreign investments are pouring in for various infrastructure projects. In January 2010, Japan expressed its interest in investing in two more infrastructure projects in Panama--the country's first metro line and the Panama-Colon highway--in addition to already being the largest contributing partner in the bay cleanup project and the canal expansion project. Leading Spanish construction company Sacyr Vallehermoso S.A. (MCE:SYV) (Madrid, Spain) is keen to invest in about $100 million in Panama's infrastructure projects. The company is already building the third set of locks for the canal expansion project. January 2010 also saw the Central American Bank for Economic Integration announce a $150 million mezzanine fund for financing infrastructure projects in the Central American states of Belize, Columbia, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, Mexico, Nicaragua and Panama.

More recently, investors and project developers have promised $2.1 billion in 52 renewable energy projects in Honduras. The projects will generate 800 MW over the next six years. Empresa Nacional de Energía Eléctrica (Tegucigalpa, Honduras), the nation's electricity company, has promised to purchase 250 MW of the generated power.

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