Sustainability
BASF, Air Liquide and Shenergy team up to produce low-carbon MDI in Shanghai
Under the deal, Shenji will convert bio-circular waste into biomethane that meets national standards and feed it into Shanghai Gas’ urban network
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By ICN Bureau | November 18, 2025
BASF partners with Air Liquide and Shenergy, to advance a sustainable MDI value chain. Photo: BASF
Global chemicals producer BASF has signed a multi-year cooperation agreement with Air Liquide’s Shanghai subsidiary and Shenergy Group’s subsidiary Shenji to advance low-carbon methylene diphenyl diisocyanate (MDI) production using biomethane.
Under the deal, Shenji will convert bio-circular waste into biomethane that meets national standards and feed it into Shanghai Gas’ urban network. Air Liquide’s SCIPIG will transform this biomethane into bio-hydrogen and bio-carbon monoxide (bio-CO). BASF will then use these bio-based industrial gases to produce MDI and derivatives with reduced product carbon footprints, including monomeric MDI for flexible foams, coatings, adhesives, shoe soles, and thermoplastic polyurethane.
"This project demonstrates BASF’s commitment to sustainability and circular economy solutions,” said Dr Jeffrey Lou, President and Chairman of BASF Greater China. “By using bio-based feedstock, we are further reducing the carbon footprint of our products and supporting local customers in their green transformation.”
Dinan Huang, Chairman of Shenergy Group, highlighted the collaboration’s impact on urban sustainability: “This marks a major milestone in building a low-carbon value chain from bio-based feedstock to green chemicals. Our goal is to accelerate green development and contribute to sustainable urban growth.”
Air Liquide China CEO Rui Coelho added, “This is the first time bio-hydrogen and bio-CO are produced locally in Shanghai from biomass, fully compliant with ISCC PLUS standards. This initiative supports decarbonization and the circular economy in the industrial park while providing reliable, competitive solutions for reducing carbon footprints.”
The partnership builds on last year’s memorandum of understanding between BASF and Shenergy, reinforcing the companies’ shared mission to integrate renewable feedstocks into chemical production. By leveraging advanced bio-waste technologies, the trio aims to set a benchmark for low-carbon industrial chemistry in China.
The collaboration is expected to play a critical role in advancing sustainable supply chains and accelerating China’s green transformation in the chemicals sector.
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