Ineos, owned by the UK’s richest person, Sir Jim Ratcliffe, will invest $2bn (£1.6bn) in Saudi Arabia for the construction of three chemical plants. It is the energy and chemical firm’s first investment in the oil-rich kingdom, which has been criticised over the murder of journalist Jamal Khashoggi and other human rights abuses.
The three plants to be constructed by Ineos will form part of a $5bn petrochemical complex being built in Saudi Arabia by the state-owned company Saudi Aramco and France’s Total. The complex will supply more than $4bn of derivatives and speciality chemicals, Ineos said on Monday.
Ineos’ three plants will produce the key building blocks for carbon fibre, engineering polymers and synthetic lubricants. It is expected to start production in 2025.
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Ratcliffe, the company’s chairman, said: “This is a major milestone for Ineos that marks our first investment in the Middle East. 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.”
Khashoggi’s disappearance and murder last year provoked an international outcry. Sir Richard Branson halted talks with the Saudi government on investment in his space tourism venture Virgin Galactic and is reportedly looking for new funds elsewhere.
Several financiers including HSBC’s chief executive, John Flint, and BlackRock’s CEO, Larry Fink, pulled out of a Saudi investment conference in October amid the outrage. However, in April both attended a Riyadh conference. Speaking on a stage with Saudi ministers, Flint said: “It’s a privilege to be back in the Saudi Arabia. We are committed. This is an economy we have a lot of confidence in.”
Ineos said the Saudi plants would have access to competitive raw materials and energy, as well as infrastructure to better serve customers in the Middle East and Asia.
One of the three Saudi plants will be an acrylonitrile plant. Ineos is one of the world’s largest producers of acrylonitrile, which is the key ingredient in acrylic fibre, used to make clothes and carpets. Acrylonitrile butadiene styrene is used to make car parts, telephones, computer casings and sports equipment.
Paul Overment, the chief executive of the firm’s nitriles division, which makes acrylonitrile, said demand was outpacing economic growth.
Ineos is investing heavily around the world. This year, it unveiled a €3bn (£2.6bn) investment in a new plant at Antwerp, a £1bn investment across the UK, acquisitions in China and capacity increases in the US.
In its biggest investment to date, Ineos is building an ethane gas cracker in Belgium to produce chemicals needed for plastics and synthetic products.
