Ineos Suspend UK Gas Production Amid High Prices

The UK's Ineos has suspended production at its three plants in Hull, blaming high gas prices.

Gas prices in the UK are twelve times higher than in the US and eight times more expensive than coal-based processes used by Chinese competitors.

Billionaire Sir Jim Ratcliffe said: 'We are being forced to mothball some of the most efficient plants in Europe, but with gas prices now 12 times the level in the US and 8 times that of China, we just cannot compete. '

The facilities produce raw materials used to make pharmaceuticals, clothing, cosmetics, detergents, construction materials and military explosives.

Ineos said up to 4,000 jobs will be affected —1,000 directly and another 3,000 in the supply chain.

But the company is trying to obtain liquefied natural gas (LNG) directly from the US at lower prices - which could take up to a year - or waits for gas prices to go down.

Ineos is asking governments in the UK and the EU — where most of its products are exported to — to put in tariff protections against Chinese products. One plant makes acetic acid, which is used in vinegar, paint and glue. Another makes acetic anhydride, a key ingredient of aspirin, and the third makes ethyl acetate, which is used in solvents and decaffeinating tea and coffee.

He said the current government's energy policy was 'economic vandalism on an industrial scale'. The wholesale price of natural gas — used for heating homes and generating electricity — has almost doubled in the UK and Europe since July. Analysts say the main driver has been a reduction in global oil and gas supplies.

Ineos says that its plants in Humberside are 'among the most efficient in the world', producing materials with half the carbon footprint of US rivals, and only one eighth the footprint of Chinese equivalents.

Two plants are already shut and a third will stop production in