As part of a strategic portfolio review, Ineos Acetyls said it has launched a feasibility study to explore building a world scale plant for acetic acid and derivatives on the US Gulf. At the same time, the olefins and polyolefins powerhouse said it will not build a plant for vinyl acetate monomer (VAM) plant in the UK, due to the uncompetitive energy situation there.
A final invesment decision is expected to be made before the end of 2023. Ineos said the project will be underpinned by its proprietary technology and will take advantage of the latest carbon-efficient processes.
Plans for the VAM plant initially were announced in 2017, when the monomer was in short supply in Europe, due in part to Ineos a few years earlier having closed a major plant that it said cheap Middle East imports had made uncompetitive. After two years of silence, the group announced in 2019 that the plant would be built at Hull, UK, rather than Antwerp, Belgium, which had also been under consideration. It provided no further details, however.
World events offer changed perspective
Meanwhile, the market perspective has changed, due a number of factors, including the coronavirus pandemic in 2020, which delayed or canceled many new projects across the industry, and Ineos’ acquisition of BP’s acetyls business in 2021 for €4.45 billion. The acquired portfolio includes acetic acid and derivatives such as acetic anhydride.
An investment on the US Gulf may also fit well with Ineos’ plans to tap US shale gas reserves for feedstock. For years, chairman Jim Ratcliffe unsuccessfully leaned on successive UK governments to make investing in shale gas easier, before announcing the group would switch its attention to the US.
In 2019, Ineos also touted the shale gas connection as ”the fundamental reason” for its decision to reenter the VAM market, saying that the group’s investment in shale gas-derived ethane has made ethylene production more competitive. For several years, it has been buying US shale-derived LNG and shipping it to its production sites at Grangemouth, UK, and Rafnes, Norway.
For the new acetic acid facility, the group said it is reviewing several ”high-quality locations.“ David Brooks, CEO of Ineos Acetyls, said the chemical producer already has a “significant presence” in the region, which “has an abundance of competitively priced feedstocks and offers a competitive advantage to support the continued global growth and customer demand for acetyl products.”
Author: Dede Williams, Freelance Journalist
