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Germany confronts a broken business model

Can the country’s industrial economy reinvent itself for an era without cheap gas from Russia?

Hives of activity don’t get bigger — and busier — than BASF’s headquarters in Ludwigshafen. The size of a small town, it’s the largest integrated chemical complex in the world, with one of Europe’s biggest wastewater treatment plants, its own hospital and fire brigade.

The lifeblood of Ludwigshafen is natural gas. It is the substance that courses through its dense network of pipes, the fuel for its power plants, the feedstock for its chemical processes. And Russia’s war in Ukraine has knocked out its main supplier.

BASF first responded to the soaring price of gas by shutting down its ammonia plant and reducing the run rate of its acetylene facility, hobbling production of two chemical building blocks used to make a host of different products that are vital to modern industrial value chains.

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