INEOS continues to impress markets with strong performance

Net debt is also cut by ¤500 million in just three months

4
min OCT 2017

INEOS’ performance slowed down slightly after a record start to the year.

In the first quarter the Group had reported earnings (EBITDA) of €753 million – up €199 million on the same time last year.

But the second quarter, though down by €115 million on the first, was still impressive at €638 million compared to €570 million this time last year.

Finance Director John Reece said the North American market had continued to benefit from its flexibility to be able to use cheaper raw materials and Europe was faring well thanks to the continued weakness of the Euro.

He said markets in Asia had also seen some strength in the quarter.

O&P North America reported EBITDA of €227 million compared to €225 million this time last year.

“The US cracker business environment was solid with healthy margins and high operating rates throughout the quarter,” said John.

Polymer demand was strong, particularly in certain product sectors such as pipe and injection moulding grades.

O&P Europe reported EBITDA of €210 million – up €20 million on this time last year.

“Demand for olefins has been solid in a tight market with top of cycle margins,” said John.

Butadiene prices have now declined from their elevated level in the first quarter of the year. European polymer demand was good in a balanced market, with solid volumes and healthy margins in the quarter.

Chemical Intermediates reported EBITDA of €201 million compared to €155 million this time last year.

“The improved performance across all of the businesses continued in the quarter, with sustained good demand for products together with tight supply side conditions as a result of planned and unplanned competitor outages,” said John.

The overall demand trend in the Oligomers business was strong in most product sectors and markets.

Demand for the Oxide business was stable, with particular strength in ethyl acetate and butanol.

Market conditions for the Nitriles business were healthy due to a combination of strong underlying demand, especially in acrylic fibre, and supply limitations due to a number of industry outages.

Phenol markets remained balanced, with some weakness in Europe due to customer turnarounds.

John said the Group had also continued to focus on cash management and liquidity, reducing its net debt by €500 million in just three months. At the end of June net debt stood at about €5.2 billion.

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World leaders

IN today’s increasingly dynamic and changing world, there is no substitute for innovation. It is the key to driving economic growth, the insurance against irrelevance and unlocks the door to real progress. As the pressure on resources grows, applications become more demanding and sustainability becomes more than just a buzzword, the need for innovation has never been greater. INEOS Styrolution understands that. As such, it focuses on the customer – and what the customer wants. But it does not work on its innovative R&D activities alone. It has set up a global innovation network with organisations such as the Washington State University, Fraunhofer LBF Darmstadt, Neue Materialien Bayreuth GmbH and the University of Bayreuth to deliver best-inclass solutions to customers to give them a competitive edge in their respective markets. For almost four years, it has been working closely with Germany’s Neue Materialien Bayreuth GmbH, a strong R&D site in material science, and the University of Bayreuth. The university carries out the basic research, NMB explores the innovative production processes and INEOS Styrolution, which steers the entire research process, is ultimately responsible for the production and launch of any innovative solutions. “It’s a fantastic and unique partnership,” said Dr Norbert Niessner, Global Head of Research and Development at INEOS Styrolution. “We not only have a lot of ideas but, together with our innovation partners, we also have the resources to execute them.” The beneficiary of the set-up is the customer. “Typically, if you work in R&D, the perception is that you are working in an ivory tower, but that is not the case here,” he said. “We include the Bayreuth researchers as if they were our own people. They are exposed to real customers’ challenges and that’s what makes this collaboration so outstanding. It’s the will and the brains working together to find a solution.” The end result, as far as INEOS Styrolution believes, though, is the same: keeping the customer one step ahead of the pack is the most important thing. “We are committed to giving our customers a competitive edge in their markets,” said CEO Kevin McQuade. “If we want to find the best solution for them, we need to work hand in glove with them. The innovation network is a win-win for everybody. Customers get access to the best solutions and access to resources. The partners are also happy because they are carrying out research for a real-life purpose.” The automotive industry is one where INEOS Styrolution focuses heavily. Earlier this year it, together with NMB, unveiled a brand new solution, which offers a lot of opportunities for the automotive industry. StyLight, as it is known, is a composite based on the company’s styrenic materials, and it is currently being evaluated by several car manufacturers. “We are expecting the first orders soon,” said Norbert. The automotive industry, though, is not the only one to benefit from the wisdom and brainpower of INEOS’ academic partners and the expertise and drive of the INEOS Styrolution team. Together they recently started working on a project that aims at developing innovative solutions for the recycling of polystyrene. “Sustainable plastics is a mega topic these days,” said Norbert. “So we want to make this happen. It may take a few years, but we are quite confident we will be able to do it.” What sets INEOS Styrolution apart is the importance it places on developing solutions, not just for its customers to stay one step ahead of the competition, but for the benefit of society. “I think only those companies which provide true value to the customers, and here I include sustainability aspects such as saving greenhouse gases and resources, will retain their market position,” said Norbert. It is not only INEOS Styrolution that is impressed with the partnerships it has forged over the years. “The collaboration provides application-focused research fields, which are attractive to our students and researchers,” said Prof Dr Hans-Werner Schmidt, Department of Macromolecular Chemistry, University of Bayreuth. By working together on innovative ideas for INEOS Styrolution’s customers in the automotive, electronics, household, construction, healthcare and packaging industries, they believe they can create the styrenics of tomorrow. “That customer-orientated innovation is at the core of our growth strategy,” said Kevin. The company regularly hosts innovation days when customers can give them a shopping list of what they are looking for over the next three to five years. In short, INEOS Styrolution works hard to understand what customers want to give them a competitive advantage. Everything it does is geared towards fulfilling its socalled Triple Shift strategy, three areas which it has identified as key to help profitably grow the business. Firstly, teams, each with an in-depth knowledge of their customers’ specific industry, work closely with their customers to deliver best in class solution, be they in the automotive or any other focus industry. Secondly, it focuses on producing more, higher value, styrenic specialty products. And finally, it continually expands its business in areas deemed ripe for growth, such as Asia. And it is on track to do that. Earlier this year it completed its first acquisition. Buying the global K-Resin® styrene-butadiene copolymers (SBC) business, with a manufacturing site in Korea, helped to expand INEOS Styrolution’s position in the Asian growth market and cement its position as the only styrenics manufacturer with a true global footprint. “We already had SBC production sites in the Americas and Europe, but we were missing a SBC manufacturing plant in Asia-Pacific,” said Kevin. “K-Resin is now filling that formerly white spot for our SBC specialty business on our map.” The company now employs 3,200 people and has 16 production plants and six R&D sites in nine countries. Looking to the future, Kevin remains optimistic and excited. “In the early days of the Joint Venture between BASF and INEOS, we focused on synergies,” he said. “Now that we have the right structure in place, we are looking at accelerated growth. We have a truly global presence that gives us a local insight into what’s going on in the world 24 hours a day, seven days a week. These are exciting times.”

7 min read

Energised – and up for the challenge

NOW is not the time to be living on another planet. Real focus on new ways of working is needed if energy-hungry companies like INEOS are to have a future in a world that is rapidly changing. For it is not just the climate, which is changing, so too is the resolve of those in power in the European Union to cut emissions and reduce energy consumption in its transition to a lower carbon economy. America may have won a temporary reprieve – thanks to US President Donald Trump – but the EU wants a 40% reduction in greenhouse gases, a cap on energy use in industry and at least 27% more renewable sources used in its energy mix by the year 2030. “We are literally drowning in targets,” said Greet Van Eetvelde, INEOS Manager of Cleantech Initiatives. “And because of that, the chemical industry’s competitiveness in Europe is at stake.” But that’s where the pessimism ends. The European Union has set aside tens of billions to support innovation in industry while trying to meet those targets – and Greet believes if anyone can find answers to some of society’s great challenges, INEOS can. “We are good at finding opportunities in every challenge,” said Greet. “And the European Union knows that by offering incentives and partnering with industry, they may stand a chance of meeting the grand societal challenges.” Outside Europe too, the opportunities are growing for INEOS to fund new projects at its sites thanks to support schemes, tax exemptions and grants for innovation and investment. “There is money to be had for supporting a lower carbon economy,” she said. Greet heads up INEOS’ Carbon & Energy Network, which regularly shares information and best practices on all carbon and energy related matters with all INEOS’ businesses. “The network keeps a finger on the pulse on all that happens at policy level and has an impact on INEOS,” she said. “That’s why it is also a breeding ground for novel creative initiatives to tackle the grand challenges, engage with universities and embark on industrial research projects.” Greet said creativity had to be at the forefront of the transition economy. “Innovation is INEOS’ main driver,” she said. Indeed what INEOS has become good at is securing EU funds for projects that will not only benefit the company but also society. “It is about seeing and seizing every opportunity,” said Greet. “As much as it is a grand challenge, it is also a huge opportunity for us to collaborate with universities and students.” And that is what INEOS is now doing. Earlier this year six graduates were given the chance to look at how INEOS operates now – and suggest how it could operate in a radically different future. “The PhD students will bring real value to INEOS in areas where we don’t usually go because of a lack of time and resources,” said Greet. The graduates will be focusing on six areas that present big challenges to INEOS, including energy efficiency, electrical flexibility, carbon capture, circular resources, and industrial symbiosis. “We trust they will be able to show INEOS how to use, reuse and recycle carbon and waste sources in a way that we can benefit from it,” said Greet. “They are likely to have new ideas about the future because they are the future. Sometimes those ideas might be a bit on the wild side but that is what is needed. This is a unique opportunity for them to be seen and heard and taken seriously. They are showing us the road ahead.” Graduates awarded their tasks VALUABLE research is now being carried out at several plants in INEOS. The PhD students or INEOS graduates will be asking potentially difficult questions and challenging processes in an effort to come up with new ways of working more efficiently with fewer resources. Sander Marchal, a commercial graduate based in Koln, will be focusing on the transition to a circular economy. Part of his brief will be to look at plastic packaging which the EU wants to see a 75% reduction by 2030. "We are a plastics producer,” he said. “But being part of the solution is better than being left out of the conversation.” Benedikt Beisheim, an Energy Optimiser at INEOS Koln, is hoping to find ways to improve the processes at the mature German plant to either save energy or raw materials. He will also focus on the nearby energy park to see how off gases and natural gases can be used more efficiently to produce steam and electricity. Cindy Jaquet has been working with the Carbon & Energy Network in Rolle, Switzerland. Her role has been to spread the word about sustainable practices and prove to others that sustainability is not impossible. “I needed to show the public, our partners, our customers and our competitors that sustainability can actually be a real business opportunity,” she said. Jens Baetens is also a PhD student. His project will hopefully help INEOS to find a solution to maintaining a reliable energy supply when wind and solar power start to replace gas and electricity. His focus will be on the 10 INEOS sites in Belgium. “We will be trying to understand the power demand at our sites and what resilience we can build in,” he said. Helene Cervo is a PhD student who is hoping to apply the lessons of nature to a project at INEOS’ site in Lavera in France. “All waste produced by one organism can be used by another,” she says. “There is no waste.” She will be looking at collaborating with other businesses on the site to see how energy, materials and services can be shared more efficiently. And finally, Gabby Isidro, will be hoping to help governments understand the consequences of their regulation, which govern CO2 emissions, on European competitiveness by showing them the overall cost and impact. “Knowing in detail what our position is today and into the future helps us to make sound, longterm business decisions and influence investment strategy,” she said

5 min read

There’s no stopping us now

IF you are looking for runaway success stories, look no further than the faces of these children who are the latest kids to be inspired to run for fun by INEOS. They covered the 2km distance – and had a wonderful time – at London’s iconic Queen Elizabeth Olympic Park in June. Among those championing INEOS’ campaign on the day were Olympians Denise Lewis and Colin Jackson. “GO Run For Fun has come such a long way since September 2013,” said Colin. “The campaign has reached an amazing milestone with over 200,000 children from seven countries taking part.” INEOS Chairman Jim Ratcliffe founded GO Run For Fun with one simple aim: to encourage children to give the TV a rest, and go outside. Denise Lewis, who hosted a panel discussion on the importance of encouraging children to be more active and the role played by parents, teachers and government, described GO Run For Fun as a wonderful, fun initiative. “I have been involved in sport all my life but I got into it because it was fun,” she said. “INEOS is doing a fantastic job.” Schools report healthy start to INEOS' pilot project INEOS’ campaign to breed a healthier generation has been making friends in the classroom. In February, 65 primary schools in the UK were chosen to take part in a pilot project. “We wanted to create something fun for the kids with a serious message,” said John Mayock. The results of the pilot project are now in and the feedback from pupils and teachers has been incredibly positive. “It has been really encouraging,” said John. “We are now analysing the results to determine the next steps to roll out this exciting programme to other international sites.” As part of the GO Run For Fun Education Programme project, two children from each of the 65 schools were chosen as Special Agents to encourage their 19,500 classmates to eat healthier foods and lead more active lives. The ‘agents’ were tasked with guiding their friends on different missions each week in the run-up to a 2km GO Run For Fun event. “The idea was to show children the real benefits of leading a healthy and active lifestyle,” said John. Part of the message was to encourage kids to give sugar a run for its money – and start drinking more water. Missions could be completed at break time, during lunch or in the classroom. “That was important because it gives teachers flexibility,” said John. INEOS decided to launch its health and wellbeing educational programme after it was often asked by schools, which were planning to take part in a GO Run For Fun event, for advice on improving fitness and healthy eating. INEOS Chairman Jim Ratcliffe initially commissioned 12 short films, featuring the GO Run For Fun mascot Dart. Since then it has been reaching out to teachers to continue the good work back in the classroom, long after the race is over. “GO Run For Fun has become so much more than just a fun run now,” said John.  

4 min read

Debate: How do we encourage children to give up sugary foods?

WE can see more and more initiatives being taken to encourage children to also eat more healthily. Schools are gradually taking their responsibility and the big retailers launch some initiatives as well (extra bonus points on the loyalty scheme when you buy vegetables & fruits). There again, the gamification aspect motivates children and parents to make the right choices. On our side, we make sure to partner up with ‘healthy alternatives’ for mass sports events where we have eg kids runs. They are good signs, but all in all it’s much more difficult to intervene in this area of healthy living. It needs a mind-shift with the parents first, and that is still very problematic today, as obesity numbers have never been higher. Jeroen Plasman, The Energy Lab WHILST the evidence about obesity and sugar is exceedingly complex, the facts about the impact of sugar on teeth are not. The science is irrefutable: sugar feeds bacteria, which produce acid that attacks teeth. And tooth decay is currently the leading cause of hospital admissions among young children in Britain. We’ve been leading urgent calls for action to lower the nation’s sugar intake, highlighting measures ranging from lowering the recommended daily allowance, through to action on marketing, labelling and sales taxes. Starting the conversation can go a long way to helping highlight the amounts of sugars in popular foods, including those marketed as ‘healthy’, and encouraging better oral health for everyone. Graham Stokes, Chairman, British Dental Association Health and Science Committee WHEN Theresa May first became prime minister, she pledged that she would look after the sick and poor, and yet within three weeks her previous adviser Nick Timothy had slashed David Cameron’s evidence-based obesity plan from 37 to 13 pages, cutting out many vital policies. I was therefore astonished to hear that following the PM’s stripped-down Queen’s speech, not a single mention was given to strengthening the government’s plan to curb childhood obesity – the biggest public health crisis that we face. Public health is hugely underfunded, considering its cost-effectiveness. It’s amazing that Theresa May can find a billion pounds to form a government but can’t find a million pounds to prevent millions of UK citizens from becoming obese or developing type 2 diabetes or high blood pressure. Graham MacGregor, Professor of cardiovascular medicine, Queen Mary University of London Nearly a quarter of the added sugar in our diet comes from soft drinks and children aged 11-18 get 40% of their added sugars from soft drinks. We have been campaigning for a sugar tax on soft drinks for many years, as we believe there are clear oral health benefits of such a tax. We welcomed the Government’s announcement of a levy on sugary soft drinks from 2018, but are calling for measures to go further to cover a wider range of sugary food and drinks, and for proceeds of the sugar levy to go towards funding children’s oral health initiatives. British Dental Association EVIDENCE shows that slowly changing the balance of ingredients in everyday products, or making changes to product size, is a successful way of improving diets. This is because the changes are universal and do not rely on individual behaviour change. A broad, structured sugar reduction programme is being led by us to remove sugar from the products children eat most. All sectors of the food and drinks industry will be challenged to reduce overall sugar, across a range of products that contribute to children’s sugar intakes, by at least 20% by 2020. Public Health England TRYING to cut down on sugar often seems like an impossible task as sugar appears to be hidden in a huge variety of products. However, there are still lots of little things that can be done to reduce our daily intake of sugar. It is important to try and make small adjustments to our diet and lifestyle in order to reduce the amount of sugar that we consume each day. It is interesting to see that in fact it does not take a long time for our taste buds to readjust to foods with less sugar, and that once they have, the foods that we used to eat appear far too sweet. Action on Sugar WE have solid evidence that keeping intake of free sugars to less than 10% of total energy intake reduces the risk of overweight, obesity and tooth decay. Making policy changes to support this will be key if countries are to live up to their commitments to reduce the burden of non-communicable diseases. Dr Francesco Branca, Director of World Health Organization’s Department of Nutrition for Health and Development

4 min read

INEOS' tour de force

INEOS likes to challenge its workforce to go that extra mile for themselves and others. And this year is no exception. But even INEOS was taken aback at the speed of the response from staff all over the world to its latest call to action. Just a week before the start of this year’s Tour de France, teams of up to 20 were invited to complete each stage of the world’s most famous cycle race as part of INEOS’ first-ever Tour de France Challenge. “We weren’t expecting to have more than 15 teams,” said Fred Michel, who came up with the concept with Jeroen Plasman and Richard Longden. But within a week 1,000 riders from more than 40 teams had ridden more than 300,000 km – the equivalent of cycling around the Earth over seven times. As the real riders had chased each other through the French countryside for the coveted title, INEOS’ teams had been squeezing in their mileage – before, during or after work. The only criteria had been that each team member would decide how far to cycle each day. “One of our objectives was simply to get people moving more than they usually would,” said Fred who received emails from staff thanking him for running the event. “They didn’t normally cycle to work but because of the challenge, they had decided to get on their bikes and had enjoyed it,” he said. “Others had encouraged their whole family to cycle at the weekends and again that was something they would never have done.” About 15 million spectators had lined the route of this year’s Tour de France as the riders headed for Paris and the final sprint down the Champs-Élysées. INEOS’ teams did not see many others, except for their teammates, even in the closing stages. By the time they had finished, they had collectively burned almost two million calories. But to appeal to INEOS’ competitive spirit, there were prizes. The Antwerp-5 were named as the team which covered the biggest distance. They covered 17,481km. “What’s amazing about Le Tour de France is that you see how people can surpass themselves and how important it is to be part of a team because they really help each other to be stronger,” said Fred Michel, who came up with the concept with Jeroen Plasman and Richard Longden. “To us, that’s the INEOS philosophy.” INEOS’ coveted yellow jersey was won by Stéphane Frigiolini, 31, from Tavaux. He completed the entire distance of 3,540 km, on his own, in 23 days. The pink jersey went to Jane Kinsella as the woman who completed the furthest distance. She rode a total of 1,275km. Her colleague Christina Schulte won a pink jersey too for cycling uphill the furthest, climbing 1,365 metres. The white jersey was won by Stef Raets who was named as the under 25-year-old who cycled the furthest, clocking up 804km. The King of the Mountain’s jersey, which was reserved for the man who made it harder for himself by riding the furthest uphill, was awarded to Matthew Rimmer. He climbed 2,953 metres. And the Grangemouth-3 won the halfway team sprint. But perhaps the real winners in INEOS’ challenge were those in need. At the start INEOS had promised to donate £1,000 to every team, which covered the distance over 21 days, to a charity of their choosing. When the challenge ended, 1,037 people in 41 teams had cycled 324,393 km – and wheeled in £40,049 for charity.

3 min read

Stéphane leads the pack

BRITON Chris Froome may have won The Tour de France for the third successive year. But it was a Frenchman who earned – and thoroughly deserved – the coveted yellow jersey in INEOS’ first ever Tour de France Challenge. Stéphane Frigiolini, 31, completed the entire distance of 3,540 km, on his own, in 23 days even though he was working. Every day the computer technician cycled to work from his home in Offlanges, Franche-Comté, to the office 26km away in Tavaux and then home again. Once he got home, he went out on his bike again. To make it harder for himself, he rode 2,775 metres uphill. “I was probably cycling about 100km a day while I was working and more than 200km at the weekend,” he said. As he neared the end of the INEOS challenge, he asked his bosses at INOVYN if he could take two, half days off. “In the beginning I just wanted to do as many kilometres as possible to be sure the Tavaux Team succeeded because it was important for me to complete the challenge for the charity we had chosen,” he said. “But then I realised I stood a chance of being first so I decided to give it a go. Those two, half days meant I could complete the 3,450km and stay in front.” Stéphane also had an added incentive. An INEOS colleague in Antwerp, Belgium, was hot on his heels. “I would like to congratulate Rudi Rutten because he was second all the way and that helped me to keep going,” he said. And kept going he did. “I have done a couple of 200km rides in the past years but nothing compared to what I have just done,” he said. “My legs will remember this challenge for quite a while.” So he is tempted to give Britain’s Chris Froome a run for his money in next year’s Tour de France? “I would love to,” he said. “But I would need many years of training to be half as fit as him.”

3 min read

Action Stations

SOMEONE once said that exercise not only changes the body, it changes your mind, your attitude and your mood. It doesn’t matter who that someone was. But someone who understands that mindset is John Mayock, a former Olympic athlete who has now helped to launch Energy Station, INEOS’ online fitness hub. John very quickly learned that health and well-being were at the core of INEOS’ ethos to being better, and staying sharper, than their rivals after he joined the company about a year ago. “I knew INEOS was passionate about improving children’s health through my work for INEOS on Go Run For Fun and The Daily Mile,” he said. “But that passion clearly didn’t end there.” INEOS has always believed that a healthy lifestyle is good for the mind, body and soul of all its employees – and does what it can to make that journey easier. One only has to look at INEOS’ new headquarters in London which boasts one of the biggest private gyms in the UK, and its new three-storey office block in, Germany, which also has an on-site gym. “As far as INEOS is concerned, being fit to work isn’t simply about being safe,” said John. “It’s about being healthy, energetic, giving our best, and enjoying our working time.” As a man once driven by the desire to improve his own performance on the track, he has now set himself another target. “We’re on a mission to help our 17,000 worldwide employees improve their health and wellbeing, whatever their role, goals or fitness levels,” he said. And the starting gun for that is the Energy Station, created by John and Golazo, a company founded by former Belgian long-distance runner Bob Verbeeck who believes that sports participation leads to a better world. Once Energy Station has been rolled out across the INEOS group, it will become the place for employees to find out about forthcoming runs, rides and triathlons and what their colleagues have been up to all over the world. Staff at every INEOS site will be able to log their performances, connect with others, share their adventures and challenge others and themselves to do better. It will also provide help and expertise on training and nutrition – whether someone just wants to walk more each week or train for a marathon. “This is for everyone,” said John. “There’s nothing elitist about it.” INEOS has also teamed up with well-known sporting brands to provide discounted fitness gear, which, in turn, will earn money for INEOS’ community fitness initiatives. “We want to bring together the existing initiatives operating throughout INEOS and inspire the growth of new ones,” said John.  

4 min read

Graduates sign up for heat of the battle

PREPARATIONS for next year’s IN NAM challenge are already underway. As INCH went to press, 24 graduates had signed up. “Everyone is eligible,” said project leader John Mayock. “No one is excluded. In all 48 graduates have the opportunity to go, but 30 will be realistic.” He described the response so far as excellent, especially from graduates in the US. Jennifer Niblo, a 24-year-old Process Technical Support Engineer based at Grangemouth in Scotland, is going back to Namibia. But this time she will be an ambassador. Her role will be to advise, inspire and train alongside the next group. “My job is to encourage them to make the most of this life-changing experience and remind them that all the hard work in training does pay off,” she said. The experience was so life-changing for Jennifer that she hopes more graduates will sign up and discover that you can achieve anything if you set your mind to it. “I cannot wait to go back,” she said. “It was an amazing opportunity to challenge what you think you are capable of and pushing through the limits, in a country with amazing landscape, scenery and wildlife.” Jennifer returned to the UK, feeling fitter and healthier. “This time last year I couldn’t run the length of myself but now if I’ve had a tough day at work, heading out for a run is a great way to clear my head, and generally makes me feel a lot better, happier, energised. I also now realise that tough problems at work don’t always have an obvious answer. You have to stick at it and work through bit by bit to get to the end.”

2 min read

Out of Africa – and fit for everything

IT was a short, sharp lesson for a privileged few in perhaps what really matters in life. Air. Food. Water. And shelter. Those, argued American psychologist Abraham Maslow, are every human’s basic needs. Once we have those, that’s when we want more. In today’s modern world we have – and demand – a whole lot more. Everything we need is within our grasp. We can order our groceries at the gym, send a text message to someone on the other side of the world and turn the heating off from the pub, if we want. So what happens when those ‘necessities’ vanish overnight? Twenty nine graduates from INEOS found out for themselves when they signed up for a 350km run, ride and hike across the unforgiving and scorching African desert in one of the rarest and toughest team-building challenges ever set by a company. Very quickly they learned that morale boosts did not come from bonuses. They came from glimpses of a rare black Rhino, a cooling breeze, the stunning view of sunrise from the summit of the Brandberg, the highest peak in Namibia, or the sight of base camp after a long and tiring day in the desert. The graduates worked well as a team, supporting each other as they scrambled over the challenging and rough terrain. “Sometimes we were pushing each other up rocks and other times we were pulling each other up,” said Gabby Isidro, a 26-year-old Energy and CO2 Trader based at INEOS’ Hans Crescent office in London. For INEOS Chairman Jim Ratcliffe, it was mission accomplished. He had told INCH shortly before they left for Namibia: ‘It’s remarkable what people can do and accomplish when they turn the brakes off in their heads.” That’s certainly how Gabby feels today. “I don’t think you truly realise your physical and psychological strength until you are pushed to your limits,” she said. Gabby readily admits she was one of the least likely people to have volunteered for the six-day adventure into the unknown. She wasn’t overly sporty and her mum Julia wasn’t keen on the idea of her daughter running, hiking and cycling in the blistering heat through the untouched Namibian desert. “I was overweight and unfit and my mum was concerned about my right wrist which is part metal, part plastic,” she said. “I’d had five operations between the ages of 18 and 22 and she was worried that all of that reconstructive work could be undone.” But the criteria for joining was simple – If you feel you can do it, you’re in – and Gabby felt she could do it. She also suspected, remembering with a smile, that being half Portuguese might give her an advantage in the searing heat over some of the more fair-skinned graduates. “I was determined to do it,” she said. “I wanted to get healthy and fit. I knew for the bike ride I would need to wear titanium casing and a compression sock but it just showed there is always a way round things.” The training beforehand was intense but invaluable. “I travel every week and have a lot of responsibility which I love but I remember being in Norway, Belgium and Switzerland in the dead of winter over January and trying to fit in my training. I very quickly, though, got better at managing my time and I got used to taking my gym equipment everywhere I went.” In May, she and her 28 INEOS colleagues from around the world boarded a plane for Windhoek, which is possibly the world’s smallest international airport. Kasper Hawinkel, a Production Engineer from INEOS Oxide in Belgium, remembers the journey well. “I remember having some doubts about my ability to complete the whole event,” he said. “I didn’t think it was possible to cycle 190km and run two half-marathons and a marathon in one week. I was wrong.” Gabby was also quite nervous but before she could really focus on the challenge ahead, she was fielding calls from potential suppliers who were bidding for an INEOS power contract. “At home I am never without my phone but out there there’s nothing. No phones, no emails, no computers,” she said. “I thought I might struggle with that but it was a real pleasure to be able to fully switch off from work and the outside world in general.” Each graduate had been given a luggage allowance of 15kg. Aside from the essentials – different shoes for running, cycling and hiking – Gabby packed some make-up. The hair straighteners were left at home. Every day presented fresh challenges. But every day the graduates faced them head-on – and as team. “You just take every day as it comes,” said Gabby. “In some ways you cannot plan for it. You are stuck in the desert, you have no choice, and you have to get from A to B so there is no point in moaning.” But there was also a real sense of pride – and a sense that they were all in it together. “That certainly kept me going,” said Kasper. “I was confronted with multiple difficult moments both mentally and physically, but I didn’t want to give up and let down the team.” Jill Dolan from INEOS’ HR department had sent the graduates a good luck message on behalf of the In Nam’17 project team before they left. “Challenges bring out the best in people as they prove you can do things you may not have thought you could do,” she said. “Those graduates will also have made friends for life built on a mutual journey of individual and team challenge and achievement.” Kasper and Gabby said life-long friendships were formed. “All of us have shared this unforgettable experience,” he said. The graduates had been warned about the heat. “When you look back it is terrifying,” said Gabby. “But at the time you just get on with the job in hand. There was an absolute determination to get through each day.” The wind was also a constant companion, sometimes unbearably so. “One day the wind was so strong that it took us almost three hours to cycle 10km (6 miles) in the 47 degree heat,” she said. “It was relentless.” Nearly half of her colleagues that day ended up being treated for dehydration. Gabby kept going – only to fall off her bike 3km from base camp. “At first I thought I must have fractured my skull because I couldn’t see properly because of all the blood,” she said. “But it turned out that even though I has split my head open, I had just dented my forehead.” The experience has changed her – not least because she now bears a small scar on her forehead. “It has helped me to find perspective and cope better in difficult or tense situations,” she said. “If ever I feel overwhelmed at work I can simply reflect on any moment of the Namibia challenge and remember that we got through it.” She is also determined to remain fit – no matter how busy she is. “I now realise that being healthy, fit and in the best physiological condition, I will be able to manage anything that is thrown my way,” she said. Phill Steffny, a safari guide from Cape Town, was one of the guides on the trip. “It’s a mind-blowing, life-changing experience,” he said. “And everyone has changed.” He said the drive and determination shown by the graduates had been inspirational. “These types of people work for INEOS,” he said. “It is in their DNA.” Phill will be among the guides leading next year’s graduates into the desert. “I think everyone can do amazing things,” he said. “You may not have a clue how to do it. But if you are given the opportunity, I cannot understand why anyone would not want to do it.” He added: “If you are on your own out there, it’s different. But they were a team. Everyone was in the same boat. One day one person might feel good, then lousy the next. It’s like life. It’s the same.”  

3 min read

INEOS’ vision paves way for fresh opportunities in Europe

INEOS’ ground-breaking decision to ship shale gas from America has paved the way for new investments on European soil. These competitively priced raw materials will now be used in plans to expand production of ethylene and propylene for INEOS’ businesses in Europe. Output from the new production will be used to feed INEOS’ derivative businesses, replacing ethylene and propylene currently purchased from other companies. In all, nearly 2 billion Euro will be spent on major new petrochemical projects in Europe, with Belgium, Norway and Scotland all likely locations for significant investments. “Without access to cost advantaged raw materials these investments could not be possible,” said Gerd Franken, CEO INEOS Olefins & Polymers North. Work on expanding the crackers at Rafnes, Norway, and Grangemouth, Scotland, is expected to start in 2019 and, once built, could add up to 900kt to INEOS’ overall of ethylene production capacity. In addition to the investments in ethylene, INEOS is also planning a new production facility to produce 750kt of propylene, with Antwerp in Belgium one of the possible locations. “The use of competitive raw materials to increase the self-sufficiency of our European businesses will support our position in Europe and help to protect our businesses against pressure from imported products,” said Gerd. “This will become increasingly important as significant new capacities come on-line in the US over the coming years.” The decision to expand capacity at Grangemouth is especially good news for the staff who, in 2013, had faced the prospect of the ethylene plant shutting due to dwindling North Sea gases. “That was our only feedstock and we were running out of it,” said John McNally, CEO INEOS Olefins & Polymers UK. “At times the plant was running at 50% capacity.” INEOS Chairman Jim Ratcliffe said that these would be the first substantial investments in the European petrochemicals industry in many years. “Collectively, these investments are the equivalent of building a new world-scale cracker in Europe,” he said. Pete Williams, Head of Investor Relations, said the investments, which could create up to 100 jobs in total, showed that INEOS was committed to maintaining a competitive manufacturing base in Europe. INEOS currently produces almost 4.5 million tonnes of ethylene and propylene – the key building blocks for many petrochemicals – but still remains the largest buyer of both in the region.

4 min read

Drive to find manufacturing base

INEOS has begun its search for a site to build what it believes will be the world’s best 4x4. Britain is the favoured location but it has received a number of attractive offers from the UK’s European neighbours. “Whilst we would love this to be a British vehicle, this is a business venture and our hearts cannot be allowed to rule our heads,” said Tom Crotty, INEOS Director of Corporate Affairs. INEOS Chairman Jim Ratcliffe, who was born in the North of England, has voiced concern over the years about the slow death of manufacturing in the UK – and the need to reverse it. But only time will tell whether the UK proves to be the best place for INEOS Automotive to invest hundreds of millions of pounds in producing its Grenadier. Jim spotted a gap in the 4x4 market early last year when Jaguar Land Rover ceased production of its iconic Defender at its Solihull plant in the West Midlands. In an interview with INCH magazine last year, he said that INEOS’ Grenadier had been inspired by the Defender but it would not be a replica. “It might share its spirit,” he said. “But it will be a major improvement on previous models.” Dirk Heilmann, CEO of INEOS Automotive, said the search for a production site was the latest step in a fantastically exciting project. “Our plans for the vehicle are well advanced and the time has come to decide where we are going to build it,” he said. INEOS needs a site capable of producing at least 25,000 cars a year to an extremely high standard. Green field sites, former car plants and even existing production lines, which can be re-configured for the new vehicle, will all be considered. “We’ve already had high level discussions with the UK government as well as a lot of international interest,” said Tom. INEOS says its new 4x4 will be aimed at farmers, forestry workers, explorers and adventurers and enthusiasts. “It needs to be an uncompromising offroader that not only stands for adventure, but is also capable of being used as a workhorse,” said Jim. INEOS is determined that its new vehicle will offer a real and pure alternative to the current crop of standardised ‘jelly-mould’ SUV’s.

4 min read

INEOS staff make a move – to a new office

ABOUT 400 INEOS employees in Köln, Germany, will soon be on the move. INEOS has invested about 30 million Euros in a new, three-storey office block – modelled on the ‘O’ in INEOS – to bring all the administrative staff together for the first time. “We see this investment as a clear sign for our future and also a reflection of how important this site is to the INEOS group,” said Dr Patrick Giefers, Commercial Managing Director and Works Manager. It is an open-plan office, which is a relatively new concept in Germany. “This is not just a new building,” said Dr Anne-Gret Iturriaga Abarzua, Head of Communications at INEOS in Köln. “This is about a new style of working, communicating and spending your day at work. At the moment if I did close my office door, no one would know I was in here.” That will change when the staff move from their individual offices to the new one. “It might take a little getting used to but it will be so much better,” said Anne-Gret. Staff will be able to see each other in the glass-fronted offices. INEOS, though, has not just invested heavily in the new building. Money has also been spent working out where everyone should sit so that the new departments not only work well together, but people are happy – and different styles of desks were tested by staff before they were bought. “Those things matter a great deal,” said Anne-Gret. “The way it has been organised means that staff can now choose to work at their desks, in the coffee bar, in the cafeteria or in what INEOS has called ‘communication zones’.” Staff will also find a modern cafeteria run by a qualified nutritionist who, if asked, will advise people on what to eat, and an in-house gym where they can keep fit, if they want. At the topping out ceremony last month, Hermann Gröhe, Germany’s Federal Minister of Health, praised INEOS for its clear commitment to looking after the health and well-being of its staff. It is not yet known what will happen to the empty offices. The new office block, though, is just part of a 211-million Euro investment package for the site where a new tanker bridge, power plant and supply tunnel, between the west and east works, will be built. 

2 min read

INEOS continues to impress markets with strong performance

INEOS’ performance slowed down slightly after a record start to the year. In the first quarter the Group had reported earnings (EBITDA) of €753 million – up €199 million on the same time last year. But the second quarter, though down by €115 million on the first, was still impressive at €638 million compared to €570 million this time last year. Finance Director John Reece said the North American market had continued to benefit from its flexibility to be able to use cheaper raw materials and Europe was faring well thanks to the continued weakness of the Euro. He said markets in Asia had also seen some strength in the quarter. O&P North America reported EBITDA of €227 million compared to €225 million this time last year. “The US cracker business environment was solid with healthy margins and high operating rates throughout the quarter,” said John. Polymer demand was strong, particularly in certain product sectors such as pipe and injection moulding grades. O&P Europe reported EBITDA of €210 million – up €20 million on this time last year. “Demand for olefins has been solid in a tight market with top of cycle margins,” said John. Butadiene prices have now declined from their elevated level in the first quarter of the year. European polymer demand was good in a balanced market, with solid volumes and healthy margins in the quarter. Chemical Intermediates reported EBITDA of €201 million compared to €155 million this time last year. “The improved performance across all of the businesses continued in the quarter, with sustained good demand for products together with tight supply side conditions as a result of planned and unplanned competitor outages,” said John. The overall demand trend in the Oligomers business was strong in most product sectors and markets. Demand for the Oxide business was stable, with particular strength in ethyl acetate and butanol. Market conditions for the Nitriles business were healthy due to a combination of strong underlying demand, especially in acrylic fibre, and supply limitations due to a number of industry outages. Phenol markets remained balanced, with some weakness in Europe due to customer turnarounds. John said the Group had also continued to focus on cash management and liquidity, reducing its net debt by €500 million in just three months. At the end of June net debt stood at about €5.2 billion.

4 min read

Germany chosen for new cumene plant

INEOS is to build its own world-scale cumene plant in Germany with the very best technology. The decision was made in response to demand from its customers and to ensure a secure supply of cumene, an essential raw material for INEOS’ phenol and acetone plants in Gladbeck and Antwerp. “Our plan shows a clear commitment to our European phenol sites and our business,” said Hans Casier, CEO of INEOS Phenol. The new plant is expected to be up and running by 2020. INEOS Phenol is the world’s largest producer of phenol and acetone and the largest consumer of cumene. It already owns and operates one of the world’s largest single train cumene plants at its Pasadena site in Texas.

1 min read

Global demand drives European investment

INEOS Oxide is to capitalise on the continuing global demand for vinyl acetate monomer (VAM) an essential chemical used to make paints, windscreens, fuel tanks, PVC and adhesives. It plans to spend hundreds of millions of Euros building a new plant at one of its integrated European sites either in Saltend, Hull, Koln in Germany, or Antwerp in Belgium. CEO Graham Beesley described it as an exciting project for INEOS. “The demand for VAM in Europe continues to grow briskly but the market is currently uncomfortably reliant on imports from remote locations for sufficient supply,” he said. “Our new capacity is designed to plug the gap and improve supply dependability to our customer base.” All three locations benefit from pipeline or terminal supply of the raw material ethylene, and low cost logistics for the other key raw material, acetic acid. In addition, all three are also well positioned to supply the VAM market efficiently.

1 min read

Oxide plans to increase production

JUST months after buying out Arkema’s 50% stake in Oxochimie, INEOS Oxide wants to grow the business. It is now considering producing a new range of oxo derivatives, including 2-ethyl hexanoic acid and polyalcohols, to complement its existing products. Oxo alcohols are mainly used to produce acrylic esters, diesel additives and paints and make lubricants. The site of the new production plant is likely to be on a core INEOS site in either Zwijndrecht, Belgium, Dormagen, Germany or Lavéra in France. “This is a significant growth project for INEOS,” said CEO Graham Beesley. Oxochimie had been a 50:50 joint venture between INEOS Oxide and the French chemicals group Arkema. INEOS fully acquired it in March this year.

1 min read

INEOS awaits verdict on shale gas core wells

INEOS Shale’s quest to unearth shale gas in the UK continues. It has now submitted two planning applications to drill vertical core wells near Sheffield so it can analyse samples of the rock. Operations Director Tom Pickering remains confident that the first well could be drilled by early next year and believes the public’s appetite for shale gas exploration is growing. “Landowners are naturally worried about protesters but it is a different backdrop today,” he said. “There has been a huge shift from three and a half years ago when we first set out on this road. The mood has changed. Brexit has really concentrated the mind. People now see that we do need to be thinking about the UK’s energy security.” The cost of drilling each well could be up to £12 million. INEOS Shale now owns the rights to explore 1.2 million acres of land in the UK for shale gas. In January this year INEOS increased its acreage when it bought Moorland Energy and with it Government licences to explore an area stretching from Helmsley to East Ayton in East Yorkshire.

1 min read