Sir Jim Ratcliffe's Ineos suspends production at three UK chemical sites over soaring gas prices
UK gas prices are now reportedly 12 times higher than in the US
Sir Jim Ratcliffe’s chemicals giant Ineos is pausing production at three plants in Hull, warning that UK industry is being priced out of the global market by soaring gas costs.
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The billionaire Manchester United co-owner said the company had been forced to “mothball” some of Europe’s most efficient chemical plants, with UK gas prices now reportedly 12 times higher than in the US and eight times above Chinese rivals.
The sites on Humberside make chemicals used in pharmaceuticals, clothing, cosmetics, detergents, paint, glue and construction materials.
One plant produces acetic acid, used in vinegar and adhesives, while another makes a key ingredient in aspirin.
Ineos said around 1,000 workers could be affected by the decision, including 245 employees based directly at the sites.
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However, staff are understood to be staying on while the company explores buying liquefied natural gas directly from the US - a process that could take up to a year.
Two of the plants have already stopped production, with the third due to pause in the coming days.
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 eight times that of China, we just cannot compete.”
Ineos claims its Humberside operations produce chemicals with around half the carbon footprint of US competitors and one-eighth of the emissions associated with equivalent production in China.
The company is now calling for tariff protection from the UK and EU against Chinese imports, as it warns the chemicals sector is being undermined by high energy costs.
Wholesale gas prices in the UK and Europe have almost doubled since July, after disruption to oil and gas flows through the Strait of Hormuz pushed up prices globally.
It is the second broadside from Sir Jim against the Government in less than a week.
He recently said he had “lost confidence” in the UK, describing the country as “on the slide” and blaming high taxes and immigration.
The Department for Business said it understood this would be a “concerning time” for workers in Saltend and their families.
A spokesperson said the Government had committed £350m for strategically important chemical producers and was taking action on electricity costs and overseas chemical imports.