SUPPORTING MANUFACTURING IN THE UK
INEOS intends to move into shale gas extraction to secure a supply of competitive energy and feedstock for its UK petrochemicals businesses. It operates some of the most energy-intensive assets in the UK, including one of only two gas crackers in the country, which makes it particularly well positioned to benefit from on-shore gas extraction as part of its wider business strategy.
Over the past few years as the North Sea’s supply of ethane has dwindled INEOS has been forced to run its plant at Grangemouth at half rates, with limited supply of raw materials necessary to produce its products. With an abundant supply of ethane emerging from the USA from shale gas, INEOS has now invested in new import terminals at its sites in the UK and Norway, as the only way to bring in sufficient gas to maintain a competitive, global olefins and polymers business. It is not only a lack of raw materials that is the issue. Energy, in the form of gas, in Europe is three times higher than the USA today, whilst electricity is 50% higher. About 85% of UK homes rely upon gas for heating or cooking, and our indigenous UK supply from the North Sea has now dwindled to less than 50% of our demand. So we are importing more from overseas.
People want a secure affordable and reliable energy supply. We have a clean energy resource in the UK shale that is ready for development, and this can bring a wide range of benefits to the country.
UK shale can help to protect manufacturing and jobs by securing competitive secure energy and raw materials.
INEOS is keen to be part of this development and we will be pursuing sensible opportunities to safely develop shale gas for the company and for the country.
The Government has recognised that shale gas has the potential to provide the UK with greater energy security, growth and jobs, and help the UK’s chemical and energy-intensive UK manufacturing industry to succeed. Done properly, responsible shale gas extraction within a strict regulatory framework presents significant opportunity for the UK with minimal environmental impact.