Industrial giant Ineos has mothballed three plants in Hull. Sir Jim Ratcliffe, billionaire CEO of the company, says that gas prices are to blame for the decision.
On the 22nd September, UK gas hit £17.62/MMBtu, in comparison to US gas which peaked at £2.13/MMBtu.
Speaking to the BBC, Sir Jim said: “We are being forced to mothball some of the most efficient plants in Europe, but with gas prices now 12 times the level in the US and 8 times that of China, we just cannot compete.”
One plant makes acetic acid, which is used in vinegar, paint and glue. Another makes acetic anhydride, a key ingredient of aspirin, and the third makes ethyl acetate, which is used as a solvent and for decaffeinating tea and coffee.
Not only does this decision shut down three facilities that produce raw materials, impacting pharma, food and drink, construction supply chains and more, it also results in job insecurity for around 1,000 of its staff.
The Department for Business, Innovation, Science and Trade said: “We’ve taken bold action to support our chemicals industry including £350 million for strategically important chemicals producers, which will be available on a co-investment basis.
Ineos says that its plants in Humberside are “among the most efficient in the world”, producing materials with half the carbon footprint of US rivals, and only one eighth the footprint of Chinese equivalents.
The disruption of supplies of oil and gas through the Strait of Hormuz following the US-Israel war in Iran has pushed up prices around the world.
