BASF, the world’s largest chemicals company, is to press ahead with the expansion of a huge joint-venture production complex with Sinopec in spite of a $500m surge in the project’s costs.

The German company said it and Sinopec, one of China’s three state-owned oil companies, had raised their investment in their Nanjing site to $1.4bn (€1bn) from $900m as a result of higher construction costs, exchange-rate effects, and plans for additional capacity.