Grangemouth Terminal UK Government Clears the Way for a € 285 Million Loan Guarantee for Ineos
The UK government grant Ineos an infrastructure loan guarantee worth € 285 million or £ 230 million. This allows Ineos to raise the money necessary to build a new terminal to import and store ethane for Grangemouth as North Sea availability declines.
Ineos Olefins & Polumers UK confirmed that it has received notification from Danny Alexander, Chief Secretary to the Treasury, that its application for an infrastructure loan guarantee has been successful: This confirmation now allows the company to raise the funds necessary to invest in a new terminal import, to store and process ethane from shale gas at its site in Grangemouth, Scotland, as North Sea supplies dwindle. The project protects thousands of jobs in Scotland and across the UK.
“Without doubt, this is one of the most important projects of recent times in Scotland, with implications to be felt right across the UK, not only for employment but also for manufacturing in general”, said Ineos Chairman Jim Ratcliffe. “Our ability to import US shale gas underpins the future of manufacturing at Grangemouth and across many businesses in Scotland. It is a vital step towards preserving the long term future of the Grangemouth site and those businesses that depend upon its continued presence in Scotland.”
More than 300 Pounds Invested at Grangemouth
The chemical company has invested more than £ 300 m at Grangemouth as part of a long term survival plan necessary for the site to manufacture petrochemicals beyond 2017. The loan guarantee from the UK Government now enables it to raise financing on £ 230 million specifically to cover the import facility and storage tank to be built at the site
The guarantee is a major step forward that ensures the long-term future of petrochemical manufacture at Grangemouth. A proposed ethane tank at the site will be the largest in Europe and is central to the site’s plans to import shale gas from the USA. By 2016 Grangemouth will be a shale gas-based facility, essential if it is to compete in world markets beyond 2017. In 2013, the company was discussing a site closure, as local media reported...
Future of Grangemouth Secured?
Gerry Hepburn, CFO, O&P UK says: “The news that the UK Government is supporting our plans to build an ethane import and storage facility at Grangemouth with a loan guarantee is a critical element to ensure the long term future of the site. We will use the loan guarantee to raise funds through a public bond issue. The proceeds of the bond will be used to fund the ethane tank project at Grangemouth. It will be very rewarding to see the renewal of the site starting to take shape as we begin construction work.”