Ratcliffe's Ineos halts production at UK plants over gas costs
Billionaire Sir Jim Ratcliffe's Ineos has suspended production at three Hull plants, saying UK gas prices are far higher than in the US and China. The move could affect up to 1,000 workers.
Industrial group Ineos, owned by billionaire Sir Jim Ratcliffe, has paused production at three plants in Hull, citing high gas prices in the UK. The company says gas costs there are twelve times higher than in the US and eight times higher than the coal-based processes used by Chinese rivals.
Ratcliffe said the government's policies were effectively forcing the closure of some of Europe's most efficient plants, arguing that competing under such gas prices is impossible. The facilities produce raw materials used in pharmaceuticals, clothing, cosmetics, detergents, construction materials and military explosives across the UK and Europe, with gas serving as a key production input.
Impact on staff
Up to 1,000 Ineos employees could be affected, including 245 who work directly at the sites. However, BBC sources indicate staff will remain employed while the company attempts to source liquefied natural gas directly from the US at lower prices — a process that could take up to a year — or waits for prices to fall.
Ineos is urging UK and EU governments to introduce tariff protections against Chinese chemical imports, since most of its output is exported to Europe. One plant produces acetic acid, used in vinegar, paint and glue; another makes acetic anhydride, a key aspirin ingredient; and a third produces ethyl acetate, used as a solvent and in decaffeinating tea and coffee.
Wholesale natural gas prices in the UK and Europe have nearly doubled since July, a rise driven partly by disruptions to oil and gas supplies through the Strait of Hormuz following the US-Israel conflict with Iran. Two of the three plants have already closed, with the third due to halt production within days.
The UK's Department for Business, Innovation, Science and Trade said it would be a concerning time for workers and their families, pointing to £350 million already committed to support strategically important chemicals producers and trade measures against foreign chemical imports.
