Frankfurt Airport to Expand

On Tuesday, Fraport secured an agreement with the Ticona chemical maker, which belongs to the industrial chemicals giant Celanese, to relocate a plant that adjoins the land where it plans to build a new runway.

The company stated it had signed a letter of intent with Ticona agreeing that the firm's Kelsterbach plant, south of Frankfurt, would be shut down by 2011. The plant which employs 900 people would then be dismantled and rebuilt elsewhere by 2015.

The final details will be worked out over the next months but Fraport has already agreed to recompense Celanese with a sum of 650 million euros ($855 million). Some 20 million euros will be paid to the chemicals company as early as this year.

Objections due to security and environmental risks

Ticona had originally objected to Fraport's plans because they feared it would represent a security risk to have jets flying in and taking off at heights of just 70 meters (76 yards) over the chemicals factory.

Environmental protection groups also oppose the plan because it will require the clearance of over 160 hectares of protected forest, as well as entail increased noise pollution for nearby inhabitants.

However, Fraport saw Ticona's security objections as a more serious threat to its expansion plans, which are supported by Hesse's regional state premier Roland Koch and have been floating around for over 10 years.

Frankfurt's airport authority insists that the construction of a fourth runway is vital to its plans to expand Europe's second-busiest airport after London Heathrow and secure thousands of jobs in the region. While air traffic in Europe continues to expand massively, Frankfurt airport is already operating at the limit of its capacity. Fraport argues that an extra runway could boost capacity by half and the company is also planning to build a third terminal. It hopes that the new runway will be operational by 2010.

The total investment required for the group's expansion plans is thought to be about 3.2 billion euros.

Relocation of Ticona plant means loss of jobs

The Frankfurter Rundschau daily reported that the Ticona plant would be relocated to a nearby suburb of Frankfurt, where Celanese's parent company Hoechst was originally located. A spokesman for Celanese declined to comment but insisted the plant would remain in Germany.

The Hesse region's opposition SPD and Green parties were critical of the deal, saying that thousands of jobs would be axed as part of the relocation.

Under the terms of the deal, Fraport has agreed to set up an employment company for Ticona employees who cannot be transferred. The Hesse authorities will also be involved.

"The fact that an employment company is being set up is a clear sign of what's to come," said the Greens' chief whip Frank Kaufmann. He said that it made no economic sense to expand an airport in such a densely-populated area.

However, Fraport chairman William Bender welcomed the deal in the name of common sense.

"Time is money," he said. "And every day that global air traffic flies past us is a lost day for our company and our employees, as well as for the region and the people who live here."

Although investors are in favor of the expansion plans, they appeared concerned by the costs. Fraport shares fell by four percent to 55 euros on the Frankfurt stock exchange Tuesday afternoon.