Chemicals giant Ineos invests 2bn dollars in Saudi Arabia
Billionaire Sir Jim Ratcliffe’s company will team up with Saudi Armaco and Total.
Chemicals and plastics giant Ineos is set to spend two billion US dollars (£1.6 billion) on building three manufacturing plants in the Middle East for the first time.
The plants in Saudi Arabia are part of a major five billion dollar petrochemical site and will see Ineos, chaired by billionaire Sir Jim Ratcliffe, team up with state-controlled Saudi Aramco and French oil giant Total.
Each site will produce carbon fibre, engineering polymers and synthetic lubricants used in the car, aerospace and manufacturing sectors.
Sir Jim, who has recently come under pressure for his decision to move to tax-haven Monaco, said: “The timing is right for us to enter this significant agreement in Saudi Arabia with Saudi Aramco and Total. We are bringing advanced downstream technology which will add value and create further jobs in the kingdom.”
The first site will be a 425,000-tonne acrylonitrile plant – a key chemical for making plastic – and is set to be the first of its kind in the Middle East when it opens in 2025.
The other plants will churn out linear alpha olefin (LAO) and polyalphaolefin (PAO), which is a high-performance lubricant used in the automotive and industrial sector.
Ineos said setting up in the Middle East will give it greater access to the raw materials needed to produce its chemicals.
Critics are expected to raise Saudi Arabia’s human rights record, following the killing of journalist Jamal Khashoggi in the Saudi embassy in Turkey.
But Tom Crotty, a director at Ineos, defended the decision.
He told BBC Radio 4’s Today programme: “We believe there is a process of change going on in Saudi Arabia, that now is a good time for us to get involved because we think investment is what will lead to fuelling that process of change and modernisation in Saudi Arabia.”
The announcement comes as campaigners targeted Ineos over the production of plastic and the impact it is having on the environment.
Campaigner and TV chef Hugh Fearnley-Whittingstall hopes to shame Sir Jim into cutting plastic production in a new documentary, War On Plastic, due out this month.
Ineos, which has annual sales of around 54 billion euros and profits of six billion euros, has also invested three billion euros into a new plant in Antwerp, £1 billion in UK investments, and acquisitions in China and the US.