Ineos, the privately owned energy and chemicals group run by Jim Ratcliffe, Britain’s richest man, is to invest £1bn in the UK — half of it to extend the life of the nation’s most important oil pipeline.
Ineos said it would invest £500m in the Forties Pipeline System, which transports 40 per cent of the UK’s North Sea oil and gas, in an overhaul that would extend its life at least two decades into the 2040s.
The group, founded by billionaire Sir Jim, will also invest £350m in a new energy plant at Grangemouth, Scotland’s most important industrial complex.
It will spend £150m in a new plant in Hull that will make vinyl acetate monomer, which is used in products such as adhesives, paints and textiles.
“This £1bn investment underlines our confidence in our business in the UK,” said Sir Jim, who has been a vocal supporter of Brexit.
“At an uncertain moment for the country, Ineos . . . is committed to continue investing in manufacturing and high skilled jobs in the UK,” he said in a statement.
Earlier in February, the Sunday Times newspaper reported that Sir Jim was in discussions with accountants PwC about a tax avoidance plan that could save up to £4bn in tax, after moving his tax residence to Monaco.
Ineos declined to comment but the report prompted John McDonnell, Labour’s shadow chancellor, to warn that such a move would jeopardise future government backing for his chemicals company.
Ineos acquired the 44-year-old Forties pipeline in 2017 as part of a strategic bet on the future of ageing North Sea oilfields. The pipeline can transport up to 600,000 barrels of North Sea oil a day for refining onshore.
Just a few months after the acquisition, global oil markets were roiled by a three-week shutdown of the pipeline that was caused by the discovery of a crack in an online section near Aberdeen.
The £500m investment would include technical upgrades and modernising of its environmental systems, Ineos said on Wednesday.
“North Sea oil and gas producers are telling us that they want to be in the North Sea well into the 2040s so we are making this commitment to be there with them,” it said.
The group said that its £350m investment in the new steam and power plant at Grangemouth would improve its energy efficiency and long-term reliability.
Ineos had announced it would close its Grangemouth operations during a dispute with the Unite union in 2013, only reprieving it after workers accepted changes to pensions and other conditions.
The group has since invested heavily in the petrochemical complex, which now relies in part on imports of US shale gas.