Photo : Yahoo Finance

In a strong move toward improving international energy cooperation, BASF Intertrade, a part of the famous German chemical company BASF, has signed a long-term supply agreement with AltaGas, a leading Canadian energy provider. This deal focuses on the regular and reliable delivery of butane gas—a crucial fuel and raw material used in the chemical industry.

This new partnership will officially begin in 2027 and continue for many years. The butane will be delivered from Western Canada to BASF through the Ridley Island Energy Export Facility (REEF), a major shipping and rail terminal being built on Ridley Island in British Columbia.

What Is Butane and Why Does It Matter?

Butane is a type of liquefied petroleum gas (LPG) used for many purposes. It's essential in the making of chemicals and plastics. It's also used as a fuel, especially in lighters, gas stoves, and even in some vehicles. For big companies like BASF, butane is an important ingredient used in their steam crackers—giant machines that heat up fuels and turn them into chemical building blocks like ethylene and propylene.

Having a secure supply of butane means BASF can continue to make important chemical products without depending too much on oil or gas from other countries.

Details About the REEF Terminal

The Ridley Island Energy Export Facility (REEF) is not just a regular terminal. It's a large-scale energy hub designed to handle huge amounts of liquefied petroleum gases (LPGs) like propane and butane, along with other bulk liquids. The terminal is being built by AltaGas and Royal Vopak, a Dutch company known for operating safe and advanced fuel storage systems around the world.

REEF will be able to move fuels by both train and ship, giving it a big advantage in handling exports. This flexibility will allow companies to move large fuel loads quickly and efficiently from Canada to other parts of the world.

Construction of REEF is moving forward quickly, and the entire project is expected to be finished by the end of 2026. Once completed, it will be one of the most advanced LPG export terminals in North America.

Why This Deal Is a Big Step

This agreement is important for BASF because it helps the company:

• Get better prices by accessing fuel directly from Western Canada, where gas supplies are strong.
• Diversify its feedstock—meaning BASF can use different raw materials in its chemical plants, making its business more flexible and safe.
• Improve energy security, especially during global supply chain disruptions or political tensions that can affect fuel availability.

For AltaGas, this deal is a big win because:

• It proves that Western Canadian energy is trusted and wanted by major global companies.
• It helps AltaGas grow its export business, which brings money and jobs to Canada.
• It shows that Canadian companies can provide clean, efficient, and reliable fuel to industries all over the world.

A Step Toward Stronger Global Energy Trade

This long-term agreement shows how Canadian energy infrastructure is becoming more connected to the global economy. It also highlights how the chemical industry, which creates many essential products like plastics, fertilizers, and synthetic materials, relies on steady fuel supplies.

By building REEF and securing partnerships like this one, Canada is setting itself up as a key player in international fuel trade.

BASF’s decision to work with AltaGas through REEF shows deep confidence in Canada’s ability to deliver clean energy consistently. This cooperation is also part of a bigger trend where companies want to reduce their dependence on traditional oil and gas markets and turn to new, more reliable sources.