Little feet make big strides

INEOS’ Go Run For Fun campaign wins children’s hearts and minds

10
min MAY 2014

The bold, new initiative launched by INEOS last year to get Britain’s children off the sofa has become a runaway success.

So many children – far from running away – have been queuing up to take part in INEOS’ Go Run For Fun events throughout the UK. The calendar is full for 2014/2015 with more than 30,000 children due to take part this year.

“These events have been extremely successful in the UK,” said Leen Heemskerk, who is leading the Go Run For Fun campaign. “We have been approached by councils, athletics clubs and schools, all wanting us to stage events.

It’s wonderful but if we are to extend the programme we need more resources. We have taken it as far as we can and we want to take it further, to even more kids but we can only do that with third party support from commercial organisations and Government.”

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INEOS GO RUN FOR FUN

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Since August last year, more than 15,000 children have already taken part in the INEOS-inspired mile-long runs for fun.

Melton Primary School in Suffolk hosted one of the events.

“Not only was it well organised, well run and very inclusive, but it has had such a positive impact on our pupils and has shown them that running, and being active, can be both fun and exciting,” said school sports coach Andrew Northcote.

Jim Ratcliffe, is passionate about running and this campaign.

“The idea for Go Run For Fun was born from a passion to get as many children running as possible, as early as possible,” he said.

“But the campaign is a real team effort and we couldn’t have done it without the team’s hard work and dedication. To reach the 15,000th runner milestone so soon is a sterling effort from all.”

By the end of this year, INEOS hopes to have staged 100 events in the UK. Some will be linked to major sporting events such as the Sheffield Half Marathon and the Bristol 10k, others to schools and athletic clubs.

Colin Jackson, an Olympic silver medallist, is an ambassador for Go Run For Fun.

“This has been a magical opportunity for children to try a little bit of running,” he said.

“These kids may never have tried running in their life but it may be the beginning of a sporting career because running is the basis of all sports.”

To ensure Go Run For Fun’s long-term future, INEOS is working with Nova International, which hosts the iconic Great Runs across the UK.

The ultimate aim for Go Run For Fun is for it to become the biggest kids’ running initiative in the world. “The aim is to attract 100,000 children by 2016 and we are well on target. If we can get additional support for what is already a successful campaign then there is no reason why we cannot increase this many times over,” said Leen.

Brendan Foster, a former British Olympic long-distance runner who founded the BUPA Great North Run, said he had no doubt INEOS would reach its goal.

In June, the first Go Run For Fun events will be held across the Channel near INEOS’ sites in Belgium, Germany and Switzerland.

“The circus is coming to town,” said Leen, the Chief Financial officer at Olefins & Polymers Europe (North).

INEOS is also extending an open invitation to its other sites around the world, including Norway, France, Italy and America, to get in touch with Go Run For Fun Project Manager Ursula Heath at ursula.heath@ineos.com

For the latest information on Go Run For Fun, visit the website at: www.gorunforfun.com

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Having already given away $28bn to his Foundation, Bill Gates now intends to eradicate polio, with the same drive he brought to Microsoft.  MOBILE PHONE Martin Cooper (1928 -) came up with the concept of the hand-held mobile phone while working at Motorola in 1973. The prototype, which weighed two kilos, is believed to have cost Motorola about $1 million in today’s money. The battery last 20 minutes but it didn’t matter because you couldn’t hold the phone for that long.  THE TELEPHONE Alexander Graham Bell (1847 – 1922) was the first to be awarded a patent for the electric telephone in 1876. He improved on the design and by 1886 more than 150,000 people owned telephones in the United States. He later said: ‘The day will come when the man at the telephone will be able to see the distant person to whom he is speaking.’  FEDEX Fred Smith (1944 -) took money left to him by his late father and founded Federal Express, a global overnight delivery service that a professor had warned him was unworkable. His company, now known as FedEx, is now believed to be the largest transportation business in the world, processing more than eight billion pieces of freight every day, and operating in at least 220 countries. PAPAYAMOBILE Si Shen was inspired after reading The Road Ahead by Microsoft founder Bill Gates. He wanted to change the world; so did she. After working for Google for several years, she left and returned to Beijing where she and a friend launched Papaya in 2008. Today she turns mobile phones into social networks. The software lets people share pictures, send messages and play games with others and it is believed to have more than 35 million users.  VIRGIN GROUP Sir Richard Branson (1950 -) dropped out of school at 16 and started out by selling records to his friends at the lowest price possible in 1970. He later opened a record shop in Oxford Street, London, and built a recording studio, signing artists such as The Rolling Stones. Today Virgin Group, which he founded, comprises of more than 400 companies. STARBUCKS It all started with a cup of coffee. Howard Schultz (1953 -) was so inspired after speaking to the staff at Starbucks in Seattle in 1981 that he joined the company as director of marketing the following year. At the time Starbucks had only four stores. In 1983, during a trip to Italy, he had a vision to bring the Italian coffeehouse tradition to America. He left Starbucks for a while, hoping to strike out on his own, but returned in 1987 and bought the company. Today Starbucks has more than 17,000 stores in 60 countries.

12 min read

Colder and bolder

It’s not everybody’s idea of heaven but some, like doug Stoup, will always be drawn to places where no man has ever dared to set foot. No man has ever set foot on the highest section of the East Antarctic Plateau. Scientists say this 620-mile, frozen mountain ridge, where temperatures can plummet below - 92°C (- 133.6 °F), is an inhospitable place where nothing really thrives or survives. It’s so cold that a human’s eyes, nose and lungs could freeze within minutes. “It is sort of otherworldly up there and it is what, I imagine, being on another planet is like,” says Ted Scambos, lead scientist from the US National Snow and Ice Data Center in Boulder, Colorado. “It is extremely difficult to breathe. In fact, breathing can be painful. Nasal passages can feel a burning sensation and inhaling too quickly can nip parts of the throat and lungs.” Polar explorer Doug Stoup knows more than most about hostile places, having explored the Antarctic more times than any other man alive. “The Antarctic is my office,” he said as he spoke to INCH magazine while skiing in the backcountry of Lake Tahoe, California. “It is an inhospitable place but I don’t have a death wish. I want to come back safe.” At 49, he’s considered something of a veteran, having travelled, climbed, skied and snowboarded in some of the remotest places on the planet. So would he be tempted to climb this remote ice plateau which, in December, scientists revealed was home to the coldest place on Earth? “Absolutely,” he said. “I have already been to so many places where no other human being has been, so the answer is ‘Yes. For sure. I love pushing myself to the limit and I have so many goals and dreams.” At a mind-numbing - 93.2 °C (- 136 °F), it is almost twice as cold as the coldest place Doug has ever been. And he knows what that is like. “You cannot stop,” he said. “It’s bitterly cold. You have to keep moving. When you are standing still, you burn calories just generating heat to stay alive. If you leave any skin exposed, frostbite sets in instantly.” Scientists discovered the coldest spot on Earth as they analysed data from satellites that have been orbiting the planet for 32 years. The latest satellite, Landsat 8, was launched in February last year and has been taking about 550 pictures of the Earth from 438 miles (705km) every day. “What we’ve got orbiting Earth right now is a very accurate and consistent sensor that can tell us all kinds of things about how the land surface of Earth is changing, how climate change is impacting on the surface of Earth, the Earth’s oceans and the icy areas, ” said Ted. “Finding the coldest place on Earth is just the beginning.” Doug would agree with that. “If you are mentally and physically prepared and have the right equipment, I believe anything is possible,” he said. Doug has been guiding teams across the frozen Arctic Ocean to the North Pole and to the South Pole in Antarctica for more than 10 years. “The journey to the North Pole is the hardest journey in the world,” he said. “As the ice moves, it opens up, and when you are sleeping in your tent, you can feel and hear the ice creaking, breaking up and moving beneath you. Sometimes it sounds like a whistle. Other times like a train. And, then of course, there’s always the danger of encountering polar bears.” Being mentally and physically prepared for what lies ahead is critical but, that alone, is not enough. Without the right clothing, many expeditions would fail. “The chemical industry has played a huge part in helping to create the stuff that keeps people, like me, alive,” he said. “It makes performance fabrics and clothing possible, to help me to stay warm and dry in some pretty inhospitable places, when I’m not active, whilst at the same time helping control perspiration when I’m on the move.” Doug, who has helped to design some of the high performance clothing for polar explorers, will soon be drawing on his experiences to help NASA in their quest to put a man on Mars. He is due to travel to Devon Island in Canada, which is home to the largest uninhabited, desert island on Earth. It is cold, dry, desolate and home to a 15-mile wide impact crater that is 23 million years old. All of that means it is a very good environment for scientists studying what it would take to conduct a manned mission on Mars. Experts are predicting that NASA could put a team of astronauts on Mars by the 2030s. Like Earth, Mars has polar ice caps, seasons, volcanoes, canyons and deserts. But with temperatures falling to - 128 °C (- 198 °F ) at night, it a good degree colder. “Mars is no place for the faint-hearted,” said a spokesman for the space agency. That’s a word no one would ever use to describe Doug, who, in 2008, almost lost his life trying to cross a crevasse field during a 47-day, 738-mile trek to the South Pole via a route first attempted by polar explorer Ernest Shackleton. Was he worried? ‘No,’ he says. Has he ever been scared? “Yes,” he says. “I caught a cab once from Heathrow into the city of London. That was crazy.”

8 min read

Debate: Is entrepreneurship contagious?

It’s an age-old question. Are entrepreneurs wired in a different way to the rest of us? Or can we all be taught to think differently? In other words, is entrepreneurship contagious? The debate about whether entrepreneurs are born or made is a hot one. Entrepreneurship is most definitely in vogue – with swathes of people wanting to be an entrepreneur, to be involved in entrepreneurial initiatives or to partner with an entrepreneur. Never before has the word had such kudos. Whether it’s nature or nurture – and a lot of entrepreneurship comes from a natural innate drive that can’t easily be taught – once you’ve had a taste of it, and even small success, there’s no looking back. I’ve definitely caught the entrepreneurial ‘bug’, and undoubtedly those creative start-ups, which are trying to change the world and solve issues, are great for communities and the economy.Michelle Wright, Chief Executive for Cause 4 This human propensity for imitative behaviour has been seen and studied repeatedly, from childhood development, to learning languages, to product and service purchases, to the decision in a crowd to check e-mail on one’s phone. In all of these cases, humans are heavily influenced by what they observe (literally or virtually) others doing. We recently carried out a survey to establish whether entrepreneurship was contagious and discovered that an individual who had been exposed to entrepreneurs — and to growth entrepreneurs in particular — was more likely to become one. The implication? Entrepreneurship can be viral, but must be introduced early and often in environments where it is least often seen. In particular, growth entrepreneurship is a narrow phenomenon, one that requires much more effort to introduce it to susceptive populations and drive overall economic growth.Paul Kedrosky, Ewing Marion Kauffman Foundation, a non-profit foundation based in Kansas City, Missouri Entrepreneurship is absolutely contagious. Once you are surrounded by motivating and innovative entrepreneurs, and get the taste for life outside of big corporate America jobs, where your efforts can have a direct impact on the company’s success and see the real-time fruits of your labour, there is no turning back. That is why many universities are scrambling to launch Masters of Entrepreneurship programmes, as the appeal of MBAs are starting to lose their luster for the next generation of workers. George Deeb, managing partner of Chicago-based Red Rocket Ventures Is entrepreneurship contagious? Think about it, and consider this: Obesity is contagious, so is quitting smoking, and so is divorce. So why not entrepreneurship? Think of how people infect (or so it seems) each other with ideas, fashion, eating habits, and customs. Doing something, even something hard, is easier to do when it feels like a lot of other people are doing it. And isn’t entrepreneurship a combination of ideas, fashion, customs, and like that? So if I start a business and make it, aren’t my friends more likely to do the same? They have a changed risk perception.Tim Berry, American founder and chairman of Palo Alto Software, Eugene, Oregon Entrepreneurship has nothing to do with genes. It has everything to do with the political, economic, educational and social environment people find themselves in. And that’s why it’s contagious. All the economic evidence today points to one simple truth: the entrepreneurial spirit is the best tool ever invented for creating growth and prosperity for individuals, companies and entire countries. Companies that gave us the pin-striped ‘organisation man’ are today promoting a culture of ‘corporate entrepreneurship’ as the best way to compete and survive in the global economy. And government leaders of all political stripes have also discovered that developing a more entrepreneurial economy is the best way to create jobs and achieve sustainable economic development. Entrepreneurship has become a global phenomenon because it works better for more people, for more companies and for more countries than any other business or economic model around. Of course, none of this could be happening if the age-old myth ‘entrepreneurs are born not made’, were true. In fact it’s never been true. The reality today is that millions of new businesses are being started each year by all kinds of people from all walks of life. Entrepreneurship happens because of circumstances – a circumstance of opportunity like coming up with a great product/ service idea – or a circumstance of necessity like being poor, or full of frustration, or getting fired. Ninety-nine per cent of the 3,000 entrepreneurs I’ve met and researched are indeed, ordinary people who simply found themselves in extraordinary situations. Larry C. Farrell, founder and chairman of The Farrell Company, a worldwide organisation that researches and teaches entrepreneurship to university students, corporations and governments. www.TheSpiritOfEnterprise.com When an entrepreneurial spirit permeates every corner of an organisation, the entrepreneur lurking in each of us awakens. Think about what characterizes successful entrepreneurs. They have tremendous belief in their abilities and in their vision for their business. Now, imagine that every person in that organisation shares that same belief. How powerful would that be? Anyone who has worked in a business that embraces the entrepreneurial spirit knows how exhilarating it is. You can feel a buzz in the air. The action on the shop floor and in the hallways is so intense that coming out of your office is like merging into rush¬-hour traffic. Decisions are made on the fly without the need for formal meetings or approvals. The esprit de corps is palpable. The whole team pitches in to do what it takes to succeed. Martin O’Neill, author of The Power of an Internal Franchise: How Your Business Will Prosper When Your Employees Act Like Owners

7 min read

Little feet make big strides

The bold, new initiative launched by INEOS last year to get Britain’s children off the sofa has become a runaway success. So many children – far from running away – have been queuing up to take part in INEOS’ Go Run For Fun events throughout the UK. The calendar is full for 2014/2015 with more than 30,000 children due to take part this year. “These events have been extremely successful in the UK,” said Leen Heemskerk, who is leading the Go Run For Fun campaign. “We have been approached by councils, athletics clubs and schools, all wanting us to stage events. It’s wonderful but if we are to extend the programme we need more resources. We have taken it as far as we can and we want to take it further, to even more kids but we can only do that with third party support from commercial organisations and Government.” Video Since August last year, more than 15,000 children have already taken part in the INEOS-inspired mile-long runs for fun. Melton Primary School in Suffolk hosted one of the events. “Not only was it well organised, well run and very inclusive, but it has had such a positive impact on our pupils and has shown them that running, and being active, can be both fun and exciting,” said school sports coach Andrew Northcote. Jim Ratcliffe, is passionate about running and this campaign. “The idea for Go Run For Fun was born from a passion to get as many children running as possible, as early as possible,” he said. “But the campaign is a real team effort and we couldn’t have done it without the team’s hard work and dedication. To reach the 15,000th runner milestone so soon is a sterling effort from all.” By the end of this year, INEOS hopes to have staged 100 events in the UK. Some will be linked to major sporting events such as the Sheffield Half Marathon and the Bristol 10k, others to schools and athletic clubs. Colin Jackson, an Olympic silver medallist, is an ambassador for Go Run For Fun. “This has been a magical opportunity for children to try a little bit of running,” he said. “These kids may never have tried running in their life but it may be the beginning of a sporting career because running is the basis of all sports.” To ensure Go Run For Fun’s long-term future, INEOS is working with Nova International, which hosts the iconic Great Runs across the UK. The ultimate aim for Go Run For Fun is for it to become the biggest kids’ running initiative in the world. “The aim is to attract 100,000 children by 2016 and we are well on target. If we can get additional support for what is already a successful campaign then there is no reason why we cannot increase this many times over,” said Leen. Brendan Foster, a former British Olympic long-distance runner who founded the BUPA Great North Run, said he had no doubt INEOS would reach its goal. In June, the first Go Run For Fun events will be held across the Channel near INEOS’ sites in Belgium, Germany and Switzerland. “The circus is coming to town,” said Leen, the Chief Financial officer at Olefins & Polymers Europe (North). INEOS is also extending an open invitation to its other sites around the world, including Norway, France, Italy and America, to get in touch with Go Run For Fun Project Manager Ursula Heath at ursula.heath@ineos.com For the latest information on Go Run For Fun, visit the website at: www.gorunforfun.com

10 min read

Europe’s chemical industry faces extinction in 10 years

Last year INEOS began warning that Europe’s petrochemical industry was facing huge challenges from outside and within. Since then, little has changed to help Europe compete with America, the Middle East and China. As it stands Europe is now one of the most expensive places in the world to make petrochemicals. That has to change, Europe’s politicians must wake up to this competitive onslaught before it’s too late, says INEOS chairman Jim Ratcliffe. Europe is dithering. But it cannot afford to, not if it wants to retain a competitive chemical industry, says INEOS chairman Jim Ratcliffe. “It’s not looking good for Europe but Europe seems agnostic about the fate of European chemicals,” he says. “I can see green taxes, I can see no shale gas, I can see closure of nuclear, I can see manufacturing being driven away. I can see the competition authorities in Brussels blissfully unaware of the tsunami of imported product heading this way and standing blindly in the way of sensible restructuring.” In an open letter to EU Commission President José Manual Barroso, Jim calls on him to take urgent steps to protect Europe’s chemical industry. “Strategically, and economically, no large economy should abandon its chemical industry,” he says. INEOS’ profits in Europe have halved in the past three years while its profits in the USA have tripled. And BASF, the world’s largest chemical company, has announced – for the first time ever – a strategic cutback in European investment, citing stagnant markets, expensive energy and expensive labour. “Energy, in the form of gas, in Europe is three times higher than the USA today, whilst electricity is 50% higher,” says Jim. “There are no cheap feedstocks in Europe. USA and Middle East feedstocks costs are in another league.” He said shale gas in America had transformed its competitiveness and its confidence. “There are $71 billion worth of announced petrochemical expansions on the back of shale gas flowing into chemicals,” he said. “And that is predicted to grow to over $100 billion. In contrast Europe announces closure after closure.” In the UK alone, 22 chemical plants have closed since 2009. Chemicals depend upon competitive energy and feedstock costs. Whilst intensely technical as an industry, and one of the reasons historically that Europe has been so successful, Jim says technology alone will not save it, and warns that the industry could be wiped out within a decade. “The European textile industry was wiped out because it could not compete with Asian labour rates,” he said. “Chemicals could go the same way. It could well be another European dinosaur.” The chemical industry in Europe currently employs one million people directly and five million others indirectly. “In Europe, chemicals and automotives share top billing with $1 trillion revenues each,” he said. “Economically speaking, the chemical industry is one of Europe’s jewels in the crown.” In his letter, Jim also highlighted the very real threat from China, which is set to become the world’s largest economy by 2020. “The Chinese are building relentlessly,” he said. “Whilst in recent history, they have soaked up all the world’s surplus chemicals, they will soon be self sufficient. And beyond that they will start to reverse the flow.”

8 min read

Experts explore options

Radical thinking on INEOS’ part in 2009 will start to pay dividends next year when the first shipments of low-cost ethane from the US begin arriving at Rafnes in Norway to help reduce operating costs at INEOS’ gas crackers in Europe. But why stop there? That’s the question INEOS is now asking itself. INEOS hates waste. And that includes squandering opportunities to run its businesses more efficiently. Having already clinched game-changing, 15-year deals with two American companies to import low-cost, shale-derived ethane gas from the US to Europe to help reduce the operating costs at its European plants, INEOS is now looking to the UK. A new team, led by Gary Haywood, is now weighing up the pros and cons of pursuing shale gas exploration and production starting in the UK, currently one of the few countries in the EU to accept the importance of hydraulic fracturing, or ‘fracking’ – the process by which gas and liquids can be extracted from shale formations. Gary said the British Government’s support for shale gas exploration had been an important factor in INEOS’ decision to invest in its own project team, which was set up in February. “Without Government support, the development of shale gas production would be virtually impossible,” he said. The British Government has now created an Office of Unconventional Gas and Oil to promote the safe, responsible and environmentally-sound recovery of the UK’s shale gas and oil resources, and has promised tax incentives to encourage investment. “The Government has recognised that shale gas has the potential to provide the UK with greater energy security, growth and jobs, and help the UK’s chemical and energy-intensive UK manufacturing industry to succeed,” said Gary. There are currently 176 Petroleum Exploration and Development Licences (PEDLs) for onshore oil and gas in the UK. More licences are due to be awarded this year. The US shale gas revolution has transformed America’s petrochemical industry. Gas prices in the US are now about a third to a half of those in Europe (and a quarter of Asian prices), and cracker feedstocks have also benefitted. Dennis Seith, CEO of Olefins & Polymers (USA), said the effect of reduced energy costs for American industry had been nothing short of phenomenal. US chemical companies are set to spend more than $70 billion before 2020 on new manufacturing facilities – fuelled by these cost advantages. The factors impacting gas prices in the UK are complex, and in some ways different to the US. It is unlikely that the impact of significant shale gas production on gas pricing will directly mirror the US situation, but there is no doubt that the development of this national resource will only improve the competitiveness of the UK gas market, as well as boost energy security, the balance of payments – and jobs. In January UK Prime Minister David Cameron, buoyed by what has happened in America, urged the European Union not to impose premature regulatory burdens on shale exploration because investors would look elsewhere. “Oil and gas will still be plentifully produced but Europe will be dry,” he told the World Economic Forum. Instead he urged the EU to embrace the opportunity. “I understand the concerns some people have,” he said. “We need the right regulations and governments need to reassure people that nothing would go ahead if environmental dangers were present. But if this is done properly, shale gas can actually have lower emissions than imported gas.” Gary’s team have already started work. The UK is estimated to contain vast and untapped reserves of shale gas. The question is whether the gas can be extracted economically. Part of the INEOS team brief is to study UK geology to identify the most prospective areas for economic production. Of course, economic production of shale gas will also require the right surface conditions, including available land, and the required infrastructure. The team has also been working with other chemical companies, energy-intensive users, and shale gas production companies to decide how best to communicate to a now sceptical public that shale gas can be extracted in a safe and environmentally-sound way. “The environment at the moment is difficult,” said Gary. “People are concerned but what we need to do is to get our message out to people, to balance those messages of concern, which can sometimes be emotional and not necessarily based on sound science or indeed knowledge of the facts.” INEOS has already adopted a strategy to help persuade the public about the very real need for shale gas exploration – by its involvement in discussions in Parliament, in the media and through INCH, and highlighting the benefits to its own employees in the hope they too will share the facts. “We need to keep driving home the message that the chemical and energy intensive industries in the UK need to be competitive, or they face a very bleak future,” said Gary. “At the moment Europe is seeing increasing competition from America and the Middle East where energy and feedstocks are very low cost. We need to explain that the development of our shale gas resource is one way that we can help here.” INEOS can use shale gas as a feedstock or energy source for its ethylene crackers but it also owns land, pipelines and storage in some of the key areas being explored in the UK. “All that, coupled with INEOS’ clear manufacturing excellence, strong safety focus and good relationships with the communities in which it operates, means that INEOS may bring something unique to this emerging industry,” said Gary. “So INEOS may ultimately opt to drill for shale gas itself.” INEOS has brought substantial external experience into the team to help with the evaluation of this exciting opportunity. Tom Pickering has 10 years’ experience in on-shore gas exploration and production in Europe, and has also applied for – and successfully obtained – the largest number of UK onshore licences of any applicant. Gareth Beamish has 30 years’ experience as a geoscientist with major companies such as ExxonMobil and BG Group, including five years’ experience in shale gas exploration globally. “We are looking at what makes sense for us,” said Gary. “We are certainly big supporters of shale gas production. Whether we are merely cheerleaders, or directly involved in exploration and production, or something in between, will depend on our assessment of the benefits and risks across our options, and then ultimately on how INEOS Capital assess those benefits and risks, and how they want to deploy the resources of the company.” If the UK does manage to tap into its vast reserves of shale gas, Gary believes it could have a knock on effect across Europe. “We can’t be sure, but we do believe that positive progress in any European country will set the tone for the rest of Europe,” he said. “People want secure, competitive and environmentally-friendly energy options, and we believe that if they had all the facts around shale gas production, then they would be supportive.”

10 min read

INEOS refines its goals

With Europe now one of the most expensive places in the world to make chemicals, energy-intensive companies like INEOS need to think creatively if they are to stay in business. At the French site in Lavéra, changes are afoot.  Marseille is the oldest – and second largest – city in France. It enjoys miles of sandy beaches and is peppered with picturesque buildings. As such, you wouldn’t expect it to have anything in common with a neighbouring crude oil refinery, which produces thousands of tons of gasoline, jet fuel, diesel, and heating oil every day. But it does. For INEOS’ Lavéra petrochemicals site and Petroineos’ crude oil refinery – just 30 miles west of Marseille – use as much energy as the city itself. And therein lies the problem. “We have got to continually maximise our energy efficiency,” said Jean-Noël Large, who now has the job of improving the energy efficiency of the 81-year-old refinery. “It is one of INEOS’ top priorities, and not just in France. The high cost of energy is a problem for the whole of Europe. Our energy costs are now incredibly high compared to America and Asia. Compared to other similar-sized petrochemical companies and refineries on other continents, we are currently in a difficult position, and people on site generally understand the situation well.” In his role, Jean-Noël works closely with on-site technicians, manufacturing, process and maintenance engineers across the site, experts from INEOS Technologies and also external partners. “The INEOS Technologies modelling team has the ability to carry out simulations to explore ways to improve the efficiency of the site,” he said. The 650-hectare Lavéra site as a whole is one of the biggest petrochemical sites in Europe. It was owned by BP when Jean-Noël joined the company in 1989. INEOS acquired it when it bought BP’s Innovene business for $9 billion nine years ago, in December 2005. “When BP owned the site, the cost of energy in Europe was competitive,” he said. “But the price of energy in Europe has continued to rise whilst the shale gas boom has dramatically reduced the price of energy for our competitors in the US, creating a huge difference between these markets. Energy is now a top priority for us and it is up there with the reliability of the site.” Tom Crotty, INEOS Group Director, said spiralling energy costs in Europe meant it now cost INEOS’ Olefins & Polymers business in France twice as much as it did in America to produce a ton of ethylene. “If we want to be around in years to come to compete then it is incredibly important to cut our energy bills,” said Jean-Noël. He is currently working on many projects. Smaller ones, including a steam balance tool to analyse steam consumption across the refinery, have already been implemented, others are ongoing – and so far investments and careful monitoring have led to a 20% reduction in the number of steam leaks – and more are in the pipeline. This year he will also oversee a major change to one of the furnaces in the refinery. The crude oil distillation unit currently runs on a mixture of liquid and gas but, from May, it will run on gas only. “At the moment the combustion of liquid fuel generates deposits in the furnace that limit its global efficiency,” said Jean-Noël. By improving the efficiency of the unit, less fuel will be burned, money will be saved and air emissions will be reduced. Petroineos Manufacturing France is also investing in a €70 million project to two install new state-of-the-art steam boilers by mid-2015. Once in place, they too will improve the efficiency of the refinery, and lead to a further reduction in emissions. In 2002, 13,000 tons a year of sulphur dioxide were being emitted into the atmosphere from the site. By 2013 INEOS had cut that figure by 70% a year thanks to a series of improvements and investment. “With the changes we are going to make, we will be able to cut further these emissions by more than 90% by 2016,” said Jean-Noël. He said all the projects would have a huge impact on the efficiency of the refinery and help the site to regain its competitiveness. “We are looking at saving up to €25 million a year,” he said. Jean-Noël is excited by what lies ahead for Lavéra, and also the difference he can make. “I have been given the freedom to explore any path judged as potentially interesting, that helps our performance and reduces cost to the business,” he said. “My field of investigation covers any unit of the refinery and any source of energy improvement. And hopefully my experience and my knowledge of the site and of the people will help me to implement this action plan.”

8 min read

Safely on track

Safety is paramount at INEOS. But it has to be, because it operates in a hazardous environment. The year may have changed, but INEOS’ approach to personal and process safety won’t. If anything, it will become even more important and robust, as Stephen Yee explains. Safety doesn’t just happen by accident. It takes a lot of hard work, and needs everyone – employees, employers and contractors – to understand what’s at stake when a company like INEOS gets it wrong. “Our commitment to safety starts at the top as a core value of our company,” said Stephen Yee, Business Safety Health and Environment Manager based at INEOS ChlorVinyls in Runcorn, UK. “We all know that the sustainable long-term future of our businesses rests on our track record on safety, health and the environment.” Last year was a good year for INEOS despite its decision to switch to OSHA, (Occupational Health and Safety Administration) a stricter, US-based system of recording workplace accidents, injuries and illnesses so that others could judge its performance against the very best. “We can now see that INEOS compares well against the likes of Shell and Dow Chemical,” said Stephen, who collates the Group’s safety reports. “But the data also shows that lower injury rates are achievable. Based on our own analysis, if we look back five years, we are approximately 50% better than we were in 2008. And in 2013 there were 70 fewer injuries reported.” Last year was a particularly good year for INEOS O&P Europe North, which won the INEOS SHE award for the second time for its safety performance and for setting a good standard in process safety management. Hans Niederberger, chief operations officer, said clear communication was one of the reasons for the business’ success last year, with SHE line managers tasked with the vital job of keeping everyone informed of what was expected. “In addition every single site has its own score card regarding SHE improvements during the year and those cards are reviewed every month,” he said. INEOS O&P Europe North reported four injuries during 2013. “That led to a frequency of 0.12 injuries per every 200,000 hours worked,” he said. “A world-class frequency is deemed to be 0.20 to 0.25.” Stephen said INEOS would be looking to the best sites to help the worst-performing sites in terms of safety. “We can – and will – learn from how the best sites approach safety to improve the performance of all businesses,” he said. At INEOS in Köln, a hard-hitting poster campaign, ‘Accidents cast long shadows’, was launched to encourage all staff to think of the potential consequences of their actions at work. Juergen Schmitz, head of the occupational safety and health department whose job is also to deliver key messages about safety to almost 2,000 employees and 1,000 contractors on site, said the campaign had been well received but it was difficult to establish a link between that and the fact that the site’s safety record had improved. “Many occupational safety-related components will have contributed to that improvement,” he said. In addition to the campaign, he said, all trainees and managerial staff – from the shift managers to the Managing Director – had attended a mandatory training safety programme in 2013. Looking back over a successful year, Stephen said there were some ‘outstanding milestones’. No one, he said, had been injured at the INEOS ChlorVinyls plant in Sweden since December 30, 2010. “To go 1,000 days without a recordable injury is something of which the plant should be very proud,” he said. Helen Axelsson, who is in charge of safety, health, environment and quality assurance, attributed the plant’s impressive safety record to 10 years of focusing on employees’ behaviour. “We have an open safety climate, where everyone could tell anyone if they think someone is working in an unsafe manner,” she said. “The last three to four years we have used the expression: ‘We always have time to work in a safe manner’ and I really think that everyone, both employees and contractors, feel that it is true.” Last year each INEOS business also implemented – despite a challenging timescale set by themselves – the 20 key safety principles devised by INEOS’ process safety management team and based on actual incidents or ‘near misses’. “We not only implemented them but each business has been independently audited,” said Stephen. “The lead auditors were site and production management from other sites which encourages sites to share best practice.” He said, though, that people should not worry unduly about statistics. “Our focus is simple,” he said. “It’s one step at a time and to focus on what we can all do to prevent injuries to those who work on our sites. The good results will follow.” But, as with most things, there is always room for improvement. “I do find it frustrating that there are still injuries which happen that can be prevented if people stop and think before they act,” he said. As a group, INEOS also wants each business to further improve its safety record by 10%. “They are challenging SHE controls,” said Stephen. “But they are achievable.”

10 min read

Business gets taste for new adventure

Baleycourt is one of the 12 businesses that come under INEOS Enterprises’ umbrella. It is a small site, about the size of 20 football pitches, but its contribution to INEOS’ success should not be underestimated. video INEOS Enterprises will be fielding another new product this year – food grade rapeseed oil. It will be the first time that INEOS has ever ventured into the food ingredients market, but by the end of 2014 it will be producing 15,000 tons of rapeseed oil at its site at Baleycourt, France. Only time will tell whether it will be a wise investment but Ashley Reed, Chief Executive Officer of INEOS Enterprises, and Chief Operating Officer Steve Dossett, who manages the business, are confident. “It is a new departure for us but rapeseed oil is becoming increasingly popular, mainly for its healthy properties and price advantage versus olive oil,” said Ashley. Production of rapeseed oil, which is a rich source of vitamin E and contains half the saturated fat of olive oil, will also help to ensure that the site – in the heart of France’s second largest vegetable oil producing region – remains competitive. For years Baleycourt had been producing tons of biodiesel for French supermarkets and oil companies like Total. In 2008 INEOS Enterprises further strengthened Baleycourt’s position when it set up an €80 million joint venture – known as INEOS Champlor – with French farming co-operative SICLAE and oil seed crushing group C.Thywissen, which led to the opening of a second biodiesel unit and rapeseed crusher and oil refining plant. “The investment was principally driven by the French government which was promoting significant levels of biofuel blending ahead of EU legislation,” said Ashley. “Each of the fuel markets (diesel and gasoline) had individual incorporation targets with severe financial penalties for the blender if they failed meet the obligation. That meant we should have had a guaranteed market.” It also meant INEOS could crush locally-grown rapeseed itself instead of buying it as rape oil from Germany, where previously it had been transported for crushing. The investment made financial sense and the partnership worked beautifully. INEOS bought in the rapeseed at a competitive price and crushed it, making thousands of tons of renewable fuel for a market that wanted it. As a bonus, the by-product was rapeseed meal, which was used as a GM-free protein animal feed for pigs. At its peak Baleycourt was producing 140,000 tons of biofuel and 180,000 tons of rapemeal every year. But then the wind started to change. In 2010 the EU introduced ‘double count’ legislation which encouraged fuel producers to blend waste feedstocks such as used cooking oil and tallow. By 2011 – with no cap on the product – the international oil trading hub, ARA, began saturating the French market with this form of fuel, materially impacting on demand for ‘single count’ rape oil derived product. Baleycourt production volumes slumped. Eventually imports into France were limited. The domestic producers did regain market share but it had altered the market dynamics significantly and French government incentives were also about to dwindle. The following year the EU Commission made a significant about turn on biofuels with a proposal to limit the quantity of biofuels made from crops to 5%. Then last year further EU legislation was imposed. In short, the EU had lost its appetite for crop-based biofuels. “There is still much debate within the EU institutions, including what is a crop, so it is not clear exactly how this will play out over the next few years,” said Ashley. “But it is highly unlikely there will be much, if any, growth in the current EU average blending levels of biodiesel made from crops.” INEOS decided it was time to take back control. To become the master of its own destiny. At the end of last year it negotiated down the JV’s uneconomic debt with the banks, bought out its JV partners, agreed a five-year, improved deal with farmers for their rapeseed and restructured the Baleycourt business. “We had been thinking about using the extra capacity to produce rapeseed oil instead of biofuels for a while but we needed the agreement of all parties,” said Steve. “The JV could not service its debts to its lenders and had been heading towards bankruptcy since the end of 2010. Failing was an option but now INEOS has a future in the oilseeds and biodiesel world, whilst still retaining the strategic supply for local seed from the French co-operatives. This new project is a toe in the water. We know there is already a very large oil market but we are confident.” The seeds of that new venture are now being sewn in the fields that surround the 25-hectare site near Verdun. But Baleycourt, which employs 150 people and turns over 250 million Euros every year, is not just about biofuels. This small French site has also been producing high quality plasticisers from alcohols and acids for more than 40 years. And business is booming thanks to the development of INEOS’ phthalates-free CEREPLAS™ Esters which are now used to make PVC cling film and food bags, car dashboards, vinyl flooring, and tubes and bags for the medical industry. Over the past five years three new grades – terephthalates, trimellitates and sebacates – have been launched on the market leading to more than 20% increase in sales volume. “This growth has been driven by matching market demand and being proactive on customers’ trends,” said Steve. Phthalates help to soften and make plastic more flexible and harder to break, but their use come under increasing scrutiny due to concerns about potential health risks. “What INEOS did – in the face of those concerns – was develop an alternative, phthalate-free ester which does the same thing,” said Steve. “Some of our competitors do still make phthalates as well as non phthalate products but we made the decision – and it was important to us – to make the site 100% phthalate free. Even though that limited our sales opportunities, it meant we could promise our customers that we would not, even by accident, supply them products containing phthalates.” Baleycourt, which sees more than 700 000 tons of various products transported in and out of the site each year, also produces esters for the lubricants market. “The future of the esters business will be to continue to grow significantly by providing tailor-made, smart solutions,” said Ashley. That will be done by keeping a close, watchful eye on the ever-changing market and coming up with innovative products to meet INEOS’ customers’ needs. “INEOS Enterprises is now recognised as a key supplier of esters in Europe which is a significant achievement, when you consider that esters’ customers are historically reluctant to change because of the lengthy approval processes imposed on them by their downstream customers,” said Ashley.

20 min read

INEOS Technologies moves fast to win business in Vietnam

A company in Vietnam has licensed INEOS Technology to manufacture polypropylene, a plastic polymer that is used in everything from fridges to carpets to car parts. Vung Ro Petroleum Limited said INEOS’ Innovene PP process would give it the edge over its competitors and help it to satisfy the growing demand in the Asian market. “The economies of Asia are growing and with that growth is a need for plastic products for infrastructure, packaging, household goods, appliances and consumer products,” said Randy Wu, Vice-President, PE/ PP Marketing and Sales at INEOS Technologies. “In the past most of those products were destined for the export market.” Vung Ro Petroleum Limited first approached INEOS Technologies in mid-2012. Within a year, the company had signed a deal with INEOS. “That’s relatively fast for a polyolefins licensing project, many of which take years to consummate,” said Randy. “But it shows that we have done such a good job developing our relationships with clients, consultants and contractors that our reputation as a leading provider of technology is widely known in the industry.” The refinery will be based in the Dong Hoa District of Phu Yen Province. “INEOS’ Innovene PP process will be an integral part of our refinery project and provide us with an advanced polypropylene process with advantaged economics and broad product reach,” said Kirill Korolev, CEO of Vung Ro Petroleum Limited.

2 min read

INEOS responds to customer demand

INEOS Oxide has expanded its ethylidene norbornene (ENB) plant in Antwerp, Belgium, to satisfy demand from customers. The plant will now be capable of producing 28,000 tons a year – 20% more than before – and, as such, becomes the largest, single ENB plant in the world. ENB is mostly used to make ethylene-propylene-diene rubber (EPDM), an extremely weather-proof, durable, synthetic rubber that is increasingly favoured by car manufacturers and the construction industry. “Debottlenecking the Antwerp plant is a unique step by INEOS that will provide sufficient ENB for the next two to three years,” said CEO Hans Casier. ENB is also used by the perfume industry as a scent carrier

1 min read

INEOS signs second deal to ship more ethane to Europe – and orders more ships

INEOS has signed another deal to import more competitively-priced shale-derived ethane from the US to help reduce the operating costs of its European gas crackers. INEOS Europe AG will begin accepting shipments from CONSOL Energy in Pittsburgh from next year. “This will allow us to continue to consolidate the competitiveness of INEOS’ ethylene production in Europe,” said David Thompson, Procurement and Supply Chain Director. Two years ago INEOS became the first petrochemical company in Europe to seize the opportunity to import cheaper energy and feedstocks from Range Resources in the US. In December 2012 it finalised 15-year contracts with three US companies which would be responsible for the drilling, distributing, liquefying and shipping of ethane from America to INEOS’ Rafnes plant in Norway. On May 7 this year INEOS announced that it had reached an agreement with Evergas to increase the number of shipping vessels to six. Those ships are currently being built in China and will transport the ethane to both the Rafnes site and INEOS’ Grangemouth plant in Scotland. The ships are the largest, most flexible and advanced multi-gas carriers yet to be built. They will provide INEOS with a flexible solution for their ethane supplies with the option of transporting LNG, LPG as well as petrochemical gases including ethylene. “The advanced design of these vessels offers very high efficiency and unparalleled flexibility to INEOS securing the longevity and strong position of their business” said Martin Ackermann, CEO of EVERGAS. The dual-fuelled vessels will use clean LNG in state-of-the-art engines securing high efficiency, low emissions and reduced fuel cost.

2 min read

INEOS sues over alleged misuse of patents

INEOS is suing state-owned Chinese oil and petrochemical company Sinopec and some of its associated businesses for allegedly violating patents. INEOS said Sinopec Ningbo Engineering Company had broken a long established technology agreement which, together with alleged misuse of trade secrets by other Sinopec companies, had enabled it to build a series of acrylonitrile plants in China without INEOS’ consent. “We want to take our best technology to China but we need to know that it will be protected,” said INEOS chairman Jim Ratcliffe. “The prolific building of acrylonitrile plants in China will destroy our business.” INEOS, which has otherwise excellent relationships with Sinopec and with China, said in a statement on March 21 that it had no choice other than to protect its intellectual property. “Unless we protect our hard-won intellectual property, which includes trade secrets and patents, covering technology, design and operations, ultimately we will see the demise of INEOS,” said Jim. INEOS fears China’s actions will cause major harm to its acrylonitrile business which generates up to $500million in profit every year and supports about 5,000 jobs in America, the UK and Germany. INEOS currently leads the global market for the production of acrylonitrile, the key building block for carbon fibre. The important molecule is also the key ingredient in ABS polymer, which is used in many everyday applications from children’s toys and computer monitors to white goods. INEOS’ acrylonitrile technology provides the basis for over 90% of the world’s production. SNEC, a Sinopec company, has had a licence to use that technology since 1984. INEOS, which is pursuing parallel actions in the Beijing High Court and through arbitration in Sweden, said it had ‘every confidence’ in China’s intellectual property system because it now files more patents than any other country. Sinopec denies INEOS’ claims.

2 min read

How journalists helped to put INEOS on the map

In 2011, when the first edition of INCH was published, research had shown that the INEOS brand was not as strong as it ought to be, given the sheer scale of the company, but that it clearly needed to be if it were to attract the very best students and potential investors and influence politicians and the media. The magazine has – hopefully – helped to address these issues, but recently INEOS’ profile has been raised in a way not even chairman Jim Ratcliffe could have predicted. INEOS can no longer describe itself as the biggest company that you have never heard of. Ever since the events at Grangemouth in Scotland, at the end of last year, views of the company along with those of its founder and chairman Jim Ratcliffe have been in demand. Newspapers from around the world have been keen to include articles on the company and its Executives. Sylvia Pfeifer, a journalist on the Financial Times, said until a few months ago, INEOS had been little known outside industry circles. “If the Grangemouth issue generated unwanted headlines, it has also lured INEOS out of the shadows,” she said. But Journalists have not only been interested in INEOS’ success story. It has also been asked to comment on such things as the state of manufacturing in Britain, the impact of the shale gas boom in the US, the crippling cost of energy in Europe and the huge opportunities for growth in China. Business editor Alistair Osborne wrote in The Daily Telegraph: “Jim Ratcliffe may not be a household name but it’s hard to find another British industrialist who, in 15 whirlwind years, has built a business from scratch into a global $43bn (£27.5bn) sales machine.  Ratcliffe is hardly a man short of experience. So when he says that Britain ‘frankly has not been a very attractive place to manufacture’, or that the UK should stop ‘faffing about’ with shale gas and nuclear power, then his views command respect.” During an interview with Brian Carney, one of the editors on The Wall Street Journal, Jim was asked what the US could do to make life even better for industry in America. “Cut corporation tax,” he said. “It’s my only gripe. If you brought it down to about 30%, the US would be unbeatable.” During an interview with Stanley Reed from the New York Times, Jim talked about why he was not prepared to see profitable sites in the US subsidising those losing money in Europe. Bernd Freytag spoke to INEOS for an article he was writing for Frankfurter Allgemeine Zeitung. In it, he described the company as a pioneer for its decision to import low-cost shale-derived ethane gas to bring down the operating costs of INEOS’ European crackers. Referring to Jim, Bernd said: “His picture of Europe for the petrochemical industry is rather grim, and he forecasts hard times. He doesn’t share the view of some experts that the US shale gas boom will soon be over. He’s alone in thinking that but he thinks that is nonsense.” A similar story appeared in Le Monde. “Europe is not a good place for business right now and it’s getting worse,” Le Monde’s London correspondent Eric Albert wrote in his first-ever interview with the company. “I do not think people understand the challenges facing them.” Interviews also appeared in newspapers in Norway and China, written by Cecily Liu, a reporter on The China Daily, reporting on the huge petrochemicals market and steady demand that are propelling China’s growth. “I only knew about INEOS because of its joint venture with PetroChina but I knew very little about Jim,” she told INCH. “After Grangemouth he became more outspoken in the media. He clearly knows how to make the most of his talents and is more willing than most people to take risks.” But one of the challenges that INEOS once faced, now no longer exists. “INEOS had grown so rapidly that the perception people had of us hadn’t kept pace,” said Tom Crotty, Group Director for Corporate Affairs. “Even some customers were saying they thought we were a bit reticent, considering our size, in putting forward our views on the market. We also had some feedback from investors and the media that we needed to open up a bit.” Today no one can level that criticism at INEOS anymore.

3 min read

INEOS slices further €30 million off its interest bill

Entrepreneurial thinking has saved INEOS a further €30 million a year in interest payments, when the company refinanced some of its borrowing in February. Video The latest decision to take advantage of favourable financial markets followed last year’s refinancing when INEOS secured a significant interest rate reduction, which cut payments by $140 million a year. “If we combine the latest improvement with those of the last 18 months we have reduced the overall interest charge from €550 million to €385 million,” said Graeme Leask, CFO of INEOS Group Holdings. INEOS was able to drive down the interest rate on its borrowing because of strong demand from investors seeking to participate in INEOS’ success. “The reaction from the investors in February was extremely positive,” said Graeme. “Demand for the new bond was seven times oversubscribed.” INEOS had been paying just under 8% on its bonds. It had hoped to pay just over 6% on the new bond. What it achieved was just under 6%. It also managed to secure a further interest rate reduction on its bank loan. “We could choose to use these savings to repay debt but our investors know that we have many good opportunities across our businesses to earn money with this investment. So it is better for INEOS and its investors to put this money to work in our businesses than pay down the borrowing,” said Peter Clarkson, head of investor relations at INEOS. Financial advisors described the latest deal, as a ‘blowout’, said Graeme. INEOS attributed its success to the communications it has with its investors to highlight the ongoing performance of the company. “We are very open with our investors and they value that transparency,” said Peter. “Every week, which is unusual in the world they invest in, we write a market update for all investors and analysts with a summary of what has been happening in all our major markets.” That culture of openness and honesty has also allowed INEOS to reduce the amount of time needed to renegotiate and secure better interest rates. A bond refinancing deal used to take up to three weeks. Now, because investors know us well, it can be done in a few days. INEOS did not need to refinance these high yield bonds until 2016 but saw an opportunity to take advantage of the good financial markets and moved quickly. “We don’t normally wait until we have reached the wire on these things because we want to give ourselves plenty of leeway,” said Peter. The latest deal also led to an improved credit rating from Moody’s which now matches Standard & Poor’s at B1/B+ “Credit rating agencies are inherently conservative and their default scenario is ‘the world’s going to end tomorrow; explain otherwise’, so to get an upgrade at this point in time is good news,” said Peter. There are also other added benefits, including the ability to negotiate more credit with suppliers which improves cash flow. Moody’s analyst Douglas Crawford said the upgrade partly reflected INEOS’ ‘resilient’ performance in 2013 and how well it expected the company to perform this year. INEOS AG Finance Director John Reece said overall the group had performed well in 2013 and that 2014 had got off to a good start. Most of INEOS’ profits, though, are coming from America, rising from about 60% in 2012 to almost 70% last year. “Shale is not the only reason we are doing well in the US but it has been transformational,” he said. INEOS is planning to invest heavily in the US over the coming year. “That investment is very much our number one priority,” said John. Plans in the pipeline include a polyethylene plant, an oligomers plant and possibly a new ethylene oxide plant. John said, “Europe, particularly southern Europe and the UK, are still challenging but our decision to import low-cost shale-derived ethane gas from America to Europe will help to reduce operating costs at our European gas crackers which will help us to remain competitive.” Looking ahead, the journey, which began in April 2012 when INEOS secured the largest-ever covenant-lite loan for a European company and the largest globally since the credit crunch, will continue. “It is part of our strategy,” said Graeme. “We are opportunistic so if there is an opportunity in the market to reduce our interest rates or extend our fi nancing, then we are always ready to do that.”

11 min read