Shale Gas Is The Path To The Future

INEOS sets sights on winning residents' hearts and minds in bid to help revolutionise manufacturing in the UK

16
min SEPT 2015

INEOS is now officially the third largest shale gas company in the UK.

Its deal with IGas – announced in March and finalised in May – has now given it access to almost a quarter of a million acres of potential shale gas reserves in Scotland and the North West of England.

“These are first-class assets that have the potential to yield significant quantities of gas in the future,” said Gary Haywood, CEO of INEOS Shale.

In August INEOS was awarded three additional shale gas licenses from the UK Government. The additional acreage cements INEOS position as one of the UK’s leading shale gas businesses.

The company believes an indigenous shale gas industry will revolutionise manufacturing in Britain (currently one of the most expensive places in the world to make petrochemicals), give the UK energy security for the first time in many years, and create thousands of jobs.

But public support remains a challenge for this nascent industry across the UK.

In March INEOS had been buoyed by a Greenpeacesponsored survey which revealed more people in the UK supported fracking than opposed it.

“It clearly showed that more and more people are seeing the potentially huge benefits of UKproduced shale gas,” Tom Crotty, INEOS CorporateAffairs Director, said at the time. “UK shale gas is a once-in-a-lifetime opportunity that we cannot afford to miss. North Sea oil created great wealth for the UK and shale gas can do the same.”

Opponents of fracking claim it is dangerous and disruptive, triggers earthquakes, contaminates drinking water and the air we breathe.

Supporters say – done properly – it is safe, provides countries with a valuable domestic resource, creates jobs, underpins manufacturing and will help to cut CO2 emissions.

America is already proof of that. There, fracking has led to a manufacturing renaissance, created thousands of jobs, driven more than $150 billion worth of investment – and helped to slash US carbon emissions by displacing coal, which emits twice as much CO2 as gas. In 2012 energy-related CO2 emissions, according to the national Energy Information Agency, fell to their lowest level since 1994 because of shale.

In April and May this year INEOS met with local residents for the first time, as part of a concerted effort to explain the facts around shale gas development, and answer the questions posed by people in the Scottish local communities which would be directly affected.

“There will always be a hard core of opponents who are philosophically opposed to fossil fuel development, despite shale gas having only half the carbon footprint of coal,” said Gary. “However, many local residents fear shale development for more local reasons – and these are the people INEOS wants to address, to reassure them of the impacts of shale development. We believe that most people are open-minded about shale development, but want more information. It is an important part of our job to give people the facts, so they can make an informed decision on whether shale gas can happen safely and successfully within their communities – which we very much believe it can.”

The meetings achieved their goal and communities appreciate the opportunity to hear from INEOS first hand, and the opportunity to get their questions answered.

The team will be following up the first set of public meetings with exhibition-style events in Scotland in September.

“Reassuring people that the industry can operate without long-term damage to the environment or their way of life is critical,” said Gary. “It is also vitally important to make the case for why shale gas development is beneficial for communities, and for the country.”

Shale gas is widely viewed as the most important bridge to any future renewable – and affordable – energy source because of its low carbon footprint – half that of coal.

As it stands, rising energy costs in Europe threaten to undermine the ability of manufacturers in the EU to compete on the world stage.

The UK is currently losing jobs to the US where they have access to cheap gas, thanks to shale. In an attempt to protect its UK petrochemical business before it’s too late, INEOS is already investing $1 billion to import shale gas from America to make its site in Grangemouth profitable and to enable the long-term growth of its site at Rafnes (Norway). In a world first, those shipments of liquefied ethane will begin arriving in Rafnes later this year, and into Scotland next.

“Our success in the UK depends on access to competitive energy and feedstock supplies,” said Tom. “Having access to more competitivelypriced feedstock and energy would transform the fortunes of the UK petrochemicals industry and help it to compete in a global market.”

It is hard to believe that Britain – as the founder of the industrial revolution – was once the powerhouse of world trade.

Today manufacturing in the UK is perceived as an industry of the past and has steadily declined with the loss of more than three million jobs over the past 20 years alone.

Yet the chemical industry is even more relevant – and important than ever in helping to create a greener economy – today.

Although it may still rely on fossil fuels to run its plants, it is estimated that for every ton of CO2 it uses, more than two tons are saved by its products, which include catalysts, insulation, components for wind turbines, and solar cells.

Drilling for shale gas may be a new venture for INEOS in the UK, but the INEOS team is being guided by three world-leading pioneers who led the development of the first commercial shale play in the US, the Barnett Shale. Since the development of the Barnett, they have gone on to work on many other shale plays in the US and around the world.

Petroleum engineer Nick Steinsberger and geologists Kent Bowker and Dan Steward, who are now working exclusively for INEOS in Europe, have more than 20 years of industry experience. They have drilled thousands of shale wells without encountering any major issues and will be advising INEOS on how best to safely access Britain’s vast reserves.

“We believe our knowledge and experience in running complex petrochemical facilities, coupled with the world-class, sub-surface expertise we recently added to our team, means that INEOS will be seen as a very safe pair of hands,” said Gary.

He added: “Shale gas is not about short-term speculation for us. It is about securing our manufacturing base which provides thousands of jobs in regional economies.”

For information about shale gas visit:
www.ineosupstream.com

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In April and May this year INEOS met with local residents for the first time, as part of a concerted effort to explain the facts around shale gas development, and answer the questions posed by people in the Scottish local communities which would be directly affected. “There will always be a hard core of opponents who are philosophically opposed to fossil fuel development, despite shale gas having only half the carbon footprint of coal,” said Gary. “However, many local residents fear shale development for more local reasons – and these are the people INEOS wants to address, to reassure them of the impacts of shale development. We believe that most people are open-minded about shale development, but want more information. It is an important part of our job to give people the facts, so they can make an informed decision on whether shale gas can happen safely and successfully within their communities – which we very much believe it can.” The meetings achieved their goal and communities appreciate the opportunity to hear from INEOS first hand, and the opportunity to get their questions answered. The team will be following up the first set of public meetings with exhibition-style events in Scotland in September. “Reassuring people that the industry can operate without long-term damage to the environment or their way of life is critical,” said Gary. “It is also vitally important to make the case for why shale gas development is beneficial for communities, and for the country.” Shale gas is widely viewed as the most important bridge to any future renewable – and affordable – energy source because of its low carbon footprint – half that of coal. As it stands, rising energy costs in Europe threaten to undermine the ability of manufacturers in the EU to compete on the world stage. The UK is currently losing jobs to the US where they have access to cheap gas, thanks to shale. In an attempt to protect its UK petrochemical business before it’s too late, INEOS is already investing $1 billion to import shale gas from America to make its site in Grangemouth profitable and to enable the long-term growth of its site at Rafnes (Norway). In a world first, those shipments of liquefied ethane will begin arriving in Rafnes later this year, and into Scotland next. “Our success in the UK depends on access to competitive energy and feedstock supplies,” said Tom. “Having access to more competitivelypriced feedstock and energy would transform the fortunes of the UK petrochemicals industry and help it to compete in a global market.” It is hard to believe that Britain – as the founder of the industrial revolution – was once the powerhouse of world trade. Today manufacturing in the UK is perceived as an industry of the past and has steadily declined with the loss of more than three million jobs over the past 20 years alone. Yet the chemical industry is even more relevant – and important than ever in helping to create a greener economy – today. Although it may still rely on fossil fuels to run its plants, it is estimated that for every ton of CO2 it uses, more than two tons are saved by its products, which include catalysts, insulation, components for wind turbines, and solar cells. Drilling for shale gas may be a new venture for INEOS in the UK, but the INEOS team is being guided by three world-leading pioneers who led the development of the first commercial shale play in the US, the Barnett Shale. Since the development of the Barnett, they have gone on to work on many other shale plays in the US and around the world. Petroleum engineer Nick Steinsberger and geologists Kent Bowker and Dan Steward, who are now working exclusively for INEOS in Europe, have more than 20 years of industry experience. They have drilled thousands of shale wells without encountering any major issues and will be advising INEOS on how best to safely access Britain’s vast reserves. “We believe our knowledge and experience in running complex petrochemical facilities, coupled with the world-class, sub-surface expertise we recently added to our team, means that INEOS will be seen as a very safe pair of hands,” said Gary. He added: “Shale gas is not about short-term speculation for us. It is about securing our manufacturing base which provides thousands of jobs in regional economies.” For information about shale gas visit:www.ineosupstream.com Gas who needs it vid Hydraulic Fracking vid

16 min read

Köln Visit: Energy Efficient

The European Commission wants drastic cuts in energy consumption in Europe. It argues that it will be good for the environment, for jobs, energy security and the economy. INEOS, which spends 1.3 billion euros on energy every year, begs to differ. THE European Commission is being urged to understand the significant day to day focus that the chemical industry has on improving its energy efficiency instead of imposing yet more targets. It is appealing to the Commission, which wants a 27% reduction in energy consumption by 2030, to see that saving energy is already a fundamental part of how INEOS operates. “We don’t need more regulations or targets,” said Tom Crotty, INEOS Group Communications Director. “Energy efficiency is already a core business value because it makes good business sense. And nearly every technology available and affordable to reduce energy consumption has already been installed at our sites. To us a further cut in energy consumption would mean a cut in production.” The Commission believes setting an ambitious energy efficiency target will be good for the environment, for jobs, energy security and the European economy. INEOS, which spends 1.3 billion euros on energy every year, says the target is unrealistic, unworkable for the chemical industry and threatens to kill the industry in Europe and, with it, six million jobs. INEOS believes the problem partly stems from the Commission’s lack of understanding about the importance and on-site reality of the chemical industry. “We already have a competitiveness problem in Europe,” said Tom. In a concerted effort to be heard amongst many people who responded to a European Commission consultation on its 2030 climate and energy policies, INEOS and CEFIC invited representatives from the Commission’s Directorate-General for Energy to visit the Köln site. “INEOS has been working with great success on energy savings for years,” said Gerd Franken, CEO INEOS O&P North. “And we believe our sites are amongst the most energy efficient in the world.” The Köln site in Germany employs 2,000 people from 28 nations, and covers an area the size of Monaco. It spends 90% of its expenses on energy and feedstock and uses enough to heat, light and power 200,000 homes. The site might use a lot of energy but that does not mean it is inefficient. Stefan Krämer, energy manager at the site, showed the DG Energy delegation how everyone on the site already worked together to save energy. “It is quite a challenge as internal energy networks at the INEOS site in Köln need to be balanced,” he said. “The nitric acid and acrylonitrile process, for instance, generates steam, and crackers and butadiene production need heat and therefore use steam.” By-product hydrogen, rather than being flared, is used thermally in the power plant instead of natural gas – a move that has saved 80,000 MWh a year of natural gas. And improvements to the cooling tower have saved a further 13,000 MWh a year of electricity. “INEOS really is determined to use and reuse everything it produces,” said Gerd, “It makes clear business and environmental sense.” During the visit, Brigitta Huckestein, Communications and Government Relations from BASF, the world’s largest chemical company, also appealed to the Commission to see sense. For the first-time ever BASF has announced a strategic cutback in European investment, citing stagnant markets, expensive energy and expensive labour. Brigitta said BASF was struggling to find any further measures to reduce its energy consumption and C02 emissions. The Ludwigshafen site of BASF is the biggest and most efficient, integrated site in Germany. But she argued that the integrated production would lose efficiency if a renewable energy surcharge was applied to selfproduced power from a CHP plant after 2017. “It will also reduce the competitiveness of this most energy-efficient installation,” she said. “In short, we already feel driven out. If regulations stipulate the production of basic chemicals in Europe as a measure to reduce European energy demand, we feel it will be dangerous for the German and European economy because value chains will be destroyed. And if conditions are not favourable, we will invest elsewhere.” Koln video Alistair Steel, a representative from CEFIC, which is the voice of the chemical industry in Europe, said affordable energy was the key to growth. “The competitiveness depends on the industry’s access to competitive, reliable energy supplies,” he said. The cost of producing ethylene in Europe is now twice as high as in the US where cheap shale gas has led to a manufacturing renaissance. And while INEOS’ profits in Europe have halved in the past three years, its profits in the USA have tripled. “We can only cut so much energy,” said Greet van eetvelde, Manager of Cleantech Initiatives and based at INEOS’ head office in rolle, Switzerland. “The European Commission has to decide whether it wants a chemical industry in Europe. It is impossible to meet these targets without significant investment and the economic climate in Europe makes this difficult.” even if INEOS wanted to fund clean technology, it faces an uphill battle. “Banks like safe bets,” said Tom. “They do not like new technologies. Often the funding of new technologies is also dependent on support by the government which includes a political risk.” Stefan said the chemical industry had been working on ways to make their production plants more efficient for years. “The self-commitment of the industry to energy efficiency started long before EU directives in 1996,” he said. Last year INEOS chairman Jim ratcliffe warned that Europe’s chemical industry was facing extinction within a decade. “I can see green taxes. I can see manufacturing being driven away,” he wrote in an open letter to Jose Manuel Barroso, then president of the European Commission. He urged the Commission to wake up. “Worldwide the chemical sector has revenues of $4.3 trillion,” he said. “That’s bigger than the GDP of Germany. In Europe, chemicals and autos share top billing with $1 trillion each. Economically speaking chemicals is one of Europe’s jewels in the crown.” INEOS is hopeful that the Köln visit may have opened eyes in Brussels. Paul Hodson, a member of the Commission delegation, said in an email to INEOS that it had given them a valuable insight into – and understanding of – the chemical industry. He said a thriving European industry was at the core of the Commission’s concerns and that its policies would seek to increase the industry’s competitiveness. What the European Commission wants by 2030 27% reduction in energy consumption (non-binding for industry) At least 27% increase in renewables 40% cut in carbon emissions

11 min read

A Question Of Mindset

Changing the workplace is easy; changing people’s mindsets is not. But with the right approach, it’s not impossible NO ONE likes change. At least that’s the theory. But the reality is that some people do. And some don’t. Companies, looking to win over all their staff, perhaps just need to change their approach. The master of management, the late Peter Drucker, was very clear about the best way for an organisation to implement change. “You have to infuse your entire organisation with the mindset that change is an opportunity and not a threat,” he said. “People are secure if they realise that this time of sudden, unexpected and radical change is a time of opportunity.” Someone who understands that change can cause emotional upset – and lead to a dip in performance – is Dr Fred Wadsworth, a medical director at UK-based Corperformance which has worked closely with INEOS in the past. “Poorly-managed change processes can be seen as a threat and cause classic stress responses,” he said. But he said the fear of implementing change should never deter a company from seeking change. “An appetite for change needs to be present and developed but that can be achieved by setting members of staff effective goals, in which they believe,” he said. “Those threatened by the journey are usually the hardest to persuade.” But even those, can be won over. John Reh, a senior American business executive and author, said understanding what – and how – things needed to be done, was half the battle. “You have to help your people understand what the change will be, when it will happen and why it needs to be done,” he said. Roberta Katz, an Associate Vice President for Strategic Planning at Stanford University in America, described change as an iterative process. “Individuals within an organisation will get on the change train at different times,” she said. “The leader will have to keep repeating the vision and repeating the strategy so that when everyone is finally on the same train, they will have heard the same message, and will understand the goal to which they are all working. If you are the leader expressing the change, you are bored, you are ready to move on, but you have to remember to keep saying it because even if someone has heard it 10 times, you may not get them to understand until the 11th time when something happens in their life to make it meaningful.” Resistance to change can often spring from a fear of the unknown. “We resist change but fear of the unknown can result in clinging to status quo behaviours, no matter how bad they are,” said Dr Stan Goldberg, a former clinicalprofessor at San Francisco State University. That fear is often based on staff perception. And perception matters because it is their reality. The good news, says Dr Wadsworth, is that perceptions – just like personality – can be changed. “Personality is a fluid thing,” he said. “Values may be set in our teenage years and be like anchors on a seabed but the way we behave is more fluid, like buoys floating on the sea. They remain connected to our anchors but are open to change. That is why goals which are linked to our values are more likely to be achieved than those that are not.” The late Mr Drucker said if a change looked like an opportunity, a company should put one or two good people to work on it. “You need someone at the top who enjoys the unexpected,” he said. “That is crucial because there will be a great many surprises, and if every surprise is a threat, we won’t be around for very long.” Mr Drucker said rapid change could be achieved without upsetting people if the staff trusted the company. “Building trust is not rocket science,” said James Hec, a member of the faculty of theHarvard Business School. “It should be pretty simple, in fact. Don’t create expectations that can’t be met. Share knowledge. Hire, recognise, and fire the right people. Be consistent and predictable and avoid large-scale layoffs as much as possible.” Dr John Kotter, a Harvard Business School professor, has written almost 20 books about leadership and change. Last year he launched Kotter International Center for Leaders, a firm of world-class experts in helping organisations change. “The rate of change is increasing faster than our ability to keep up,” he said. “Yet we expect leaders at all levels to deliver ever-better results – and sooner.” David Carder is an engagement leader at Kotter International in America. “We have seen many companies that are unable to truly capitalise on technology and change the way they want to because they are held back by their hierarchy and structure,” he said. The bottom line, said Mr Drucker, is that change is painful, risky and requires a great deal of hard work. “Unfortunately, you cannot manage change,” he said. “You can only be ahead of it. You can only make it.” Top 5 tips for a company wanting to implement change 1 Keep staff in the loop – people like to know what is going on, especially if their jobs are directly affected2 Inspire your staff – appeal to people’s aspirations and desires. Goals that are linked to their own values will be more achievable3 Think ahead – changes should be made in the long-term best interests of the company, not simply to save money in the short-term4 Be understanding – staff are more likely to accept change if they fully understand the reasons for it5 Be realistic – Unrealistic goals increase fear, which increases the likelihood of failure

6 min read

The Changing Face Of Grangemouth

The face of Grangemouth is changing. And with it, comes the promise of a new and exciting future. ONE of the largest ethane storage tanks ever to be built in Europe is taking shape. Once completed, the 60,000-cubic metre tank will hold 30,000 tons of liquefied ethane gas – and herald a new era in the manufacture of petrochemicals. “The skyline at Grangemouth has changed somewhat since the 40-metre tank wall was built,” said Alan MacMillan, O&P UK ethane project manager. “These are exciting times for the O&P UK business and the tank is tangible evidence of the investment being made.” INEOS raises the roof vid The construction of the tank is just one element of a number of synchronised projects and activities that forms O&P UK’s vision for a sustainable and viable future. INEOS is investing about £450 million to transform the loss-making Scottish manufacturing site, which employs more than 1,300 people directly, into one of the best in the world. “It is the most significant investment into UK and Scottish petrochemical manufacture of recent times,” said John McNally, CEO INEOS Olefins & Polymers UK. “And it clearly demonstrates our commitment to Grangemouth.” INEOS needs the ethane, which will begin arriving from the US next year, to replace the dwindling stocks from the North Sea. Only by securing sufficient raw materials to run the manufacturing plants optimally and at full capacity – something it has been unable to do for many years – can the Scottish site begin to turn around its fortunes. In addition to the storage tank, the ethane supply project encompasses significant infrastructure work. The business is making changes to its jetty and offloading facility, where the state-of-the-art ships will dock, and laying miles of pipes to transfer the ethane to the tank and on to the manufacturing plant. INEOS constructs ethane tank vid The work will be carried out by a number of contractors who have been hired to ensure the project is completed on time, safely and within budget. “Working alongside the many different companies and across a number of interfaces is a complex and challenging task,” said Alan. The plan being implemented at Grangemouth is very similar to the one recently undertaken at INEOS’ Rafnes plant in Norway where the company has successfully built the infrastructure to enable it to import ethane from the North American shale gas fields this year. Long-term contracts have been agreed with American suppliers to pipe the shale gas ethane cross country to the east and Gulf coasts of America from where it will be shipped across the Atlantic to Norway – and in 2016 to Scotland – in a fleet of eight specially-designed ships commissioned by INEOS. In the meantime, as Grangemouth awaits those shipments, the O&P UK business continues to work on its strategic survival plan, which will protect the long-term value of the site by creating a global leading chemicals and manufacturing hub with the potential to become a centre of excellence and innovation in Scotland.

3 min read

How The Mighty Can Fall

No one can be complacent in today's fast-paced environment. In today’s fast-paced environment, companies rise and fall faster than ever before. The biggest threat is perhaps complacency. Or as the late Steve Jobs, inventor of the iPhone, put it; “Kill complacency before it kills you.” Here are six companies that were once deemed leaders in their field, before they all sadly lost their way Blockbuster Few could have predicted how this success story would end. Blockbuster was once the undisputed leader in video rental with a market value of $5 billion. It employed 60,000 people and had 9,000 stores throughout the world. Then Netflix started sending films through the post and cable and phone companies started streaming movies into people’s homes – and Blockbuster failed to respond to customers’ changing habits. Kodak NO ONE came close to rivalling Kodak for almost 100 years. The company was built on a culture of innovation and change; it was destroyed by complacency. Most people owned a Kodak camera and used Kodak’s trademark film. But what the company didn’t picture was its own demise with the advent of digital photography, a technology that it invented. It failed to act swiftly enough and others moved in for the kill. Polaroid Apple’s iconic inventor Steve Jobs is believed to have idolised the man who pioneered the iconic Polaroid SX-70. For Edwin Land was the first to mix cutting-edge technology with design. At its peak in 1991, sales of its mainly instant cameras and film almost hit £3 billion. But its great undoing came when it failed to embrace the digital photography revolution and went bankrupt 10 years later. Motorola It’s hard to believe that Motorola built and sold the world’s first mobile phone, and in 2003 introduced the biggest-selling mobile phone ever at the time – the Razr. But Motorola failed to focus on smart phones that could handle email and pictures and rapidly lost market share. Commodore International Commodore International was one of the first computer companies to successfully compete for the home market. Its relatively small machines were well made and cheap. In the early 80s, two million Commodore 64s were being snapped up every year and the company had cornered almost 50% of the market. Then it released the smarter Commodore plus/4. A smart move one would think but the company alienated its core customers. The new model was incompatible with the old one which customers loved. The company went bankrupt in 1994. ICI ICI was once a symbol of Britain’s industrial might. At its peak the company, which invented polythene, employed 130,000 people and was one of the biggest chemical companies in the world. But in the 1990s it became too complacent. Paul Hodges, a senior executive at ICI until 1995, said the company became increasingly risk and decision-adverse. “It lost the cuttingedge, the drive to try out new directions,” he said. “Instead, ‘no surprises’ became the motto.” It moved into speciality chemicals and sold its commodity chemicals business to INEOS, under whose ownership it has grown from strength to strength. Meanwhile ICI’s earnings continued to fall. The company was eventually sold to Dutch company AkzoNobel in January 2008 and its adhesives and electronic materials businesses was bought by Germany’s Henkel three months later.

3 min read

Change Of Scene

Comfort zones are not for everyone. Especially men like Tony Moorcroft. To him, a change is always better than a rest, as INCH discovered ON 19th March 2003 American President George Bush addressed the world. In a live TV broadcast, he said that the Allied campaign to disarm Iraq, free its people and defend the world from grave danger, had begun. Watching events unravel, perhaps more closely than others, was Army reservist Tony Moorcroft, thousands of miles away at his home in the UK. For his specialist maritime regiment had already become the first to be compulsorily mobilised since the Second World War. He had received a letter, sealed in a brown envelope, in the post two months earlier. “At the time I had opened it and briefly read it before setting off for work, but I didn’t fully take in the content until a few hours later when I suddenly realised this was for real,” he said. Understandably his family were more worried than he was. “You know that it’s what you have been trained and signed up for so you become totally focused on the hour by hour, day to day tasks which enable you to overcome any fears or trepidation,” he said. “But they have to get on with a things in as normal a way as possible.” A week after he had received his call-up papers in January 2003, he had left the family home in the north of England and joined his 165 Port and Maritime Regiment, a specialist, logistical unit, as part of Operation Telic 1. Their job for the next five months would be to keep Allied Forces alive as they landed at critical locations in Iraq and Kuwait. As a non-commissioned officer he also had the added responsibility of looking after a team of men. “That really focuses the mind to achieve the outcome everybody wants which is to return safely to family and friends,” he said. Although thousands died in the conflict, Tony lived – and returned to his job as HR director for INEOS ChlorVinyls and INEOS Enterprises. “After a brief period of leave, I wanted to get back into civilian, normal life as quickly as possible,” he said. “For me it was fairly easy to adjust because as soon as I returned to work, I was back into a busy schedule. Family, friends and colleagues, though, gave me a great deal of support and didn’t pester me with endless questions, and the support I received from INEOS was fantastic. Many reservists were worried about their jobs back home. I wasn’t which meant I could focus solely on making sure everyone came home safely.” It was an experience, though, that would change his life. “I learned a lot about myself and others but it’s not one that I would repeat without trepidation,” he said. “I value life more and I think I now handle difficult situations better.” “I initially joined to enhance my engineering skills and further my career,” he said. “But being a reservist has changed my life in more ways than one and INEOS as an employer could not have done any more. In the Army Reserve you learn to prepare for very demanding environments where you have no choice but to take responsibility and be accountable for your actions. We face similar challenges and dilemmas in the chemical industry. Over the years I have found that both roles complement each other with the need for leadership, team work, discipline, integrity and respect.” He must also have been doing something right. For last year he was nominated for a Queen’s Birthday Honour – the Queen’s Volunteer Reserve Medal – for exemplary meritorious service in the conduct of their duties by his commanding officer Lt Col CK Thomas RLC. Only 13 are awarded each year. “My initial reaction was shock,” said Tony, 55. “But it very quickly turned to pride because so few of these medals are presented each year which makes it very special.” He was presented with the medal at Buckingham Palace by Prince Charles who recalled meeting Tony in 1993 at the Battle of the Atlantic commemorations ceremonies in Liverpool. “He was particularly interested in my switch from the Navy to the Army because we had both served on the same class of ship during our careers,” he said. Badge of honour ACCOLADES don’t come much higher in Tony Moorcroft’s book than the Queen’s Volunteer Reserve Medal. But then again, neither does the praise that earned him that prestigious award. His commanding officer, Lt Col Colin Thomas, who nominated him for the award, said Tony continued to stand out as an exemplary and selfless individual even though he was now nearing retirement. “He has always been known for his team spirit and readiness to sacrifice his own ease and comfort if it would help his colleagues,” he said. “All those who work with him, and perhaps most importantly those whom he commands, view him with the utmost respect. He is wholly committed, totally dependable and has unbridled enthusiasm, even after more than three decades of both naval and military service.” Lt Col Thomas said Tony cared deeply for the welfare of his soldiers when they were deployed in Iraq in 2003. “In addition to his main job, he put a huge amount of energy into turning his hand to repair or improvise basic facilities which ensured that morale remained high,” he said.

5 min read

Debate: Is Change Always A Good Thing

Some people thrive on change; others will do all they can to resist it. But are those who advocate that change is a good thing, always right? INCH sought the opinions of those with something to say Change is not always a good thing. It may force us out of tired habits and impose better ones upon us, but it can also be stressful, costly and even destructive. What’s important about change is how we anticipate it and react to it. Change can teach us to adapt and help us develop resilience, but only if we understand our own capacity for growth and learning. When change makes us better, it’s because we have learned how to turn a challenging situation to our own advantage, not merely because change happens.Rick Newman, author of Rebounders: How Winners Pivot from Setback to Success and a columnist for Yahoo Finance One of life’s constants is change. Ready or not, it happens. We grow. We age. Technology reinvents each new day. Some relish change; others resist. We like it best on our terms, but don’t always have that option. Sometimes all we can do is cope with it. When given the opportunity to exert our will in the matter, we’re wise to proceed with caution. Change for the sake of change is a risk – the grass on the fence’s other side isn’t always greener. The relentless pursuit for “better” can sometimes leave us bitter, regretting changes we didn’t need to make.Bob Tamasy, author and Vice President of Communications Leaders Legacy, Inc. Change isn’t inherently good or bad. It’s something that is inevitable. Problems are created by the speed at which it occurs and the threat it poses to those being asked to change. A helpful maxim is that the smoothest journey occurs when what you’re asking a person, organisation, or country to do, is almost as easy as not changing. Unfortunately, those who push for change are shocked when there’s blow-back. Even the most basic understanding of the principles of change would make transitions easier, whether it’s the head of a country proposing universal insurance, the CEO of a corporation after for more accountability from his employees, or a wife annoyed at her husband’s messiness.Stan Goldberg, author of “I Have Cancer,” 48 Things To do When You Hear the Words and eight other books on the sharp points of life Change is inevitable, but are we always forced to change because we live in a highly-connected, fast-paced global environment? I think change for the sake of change has nothing to do with true innovation and fostering creativity or acquiring new knowledge and learning the necessary new skills to stay competitive. For big or small businesses any change in brand identity such as image, logo, slogan, has an impact on the brand image and how the customers perceive the products or services. In most cases, loyal brand lovers hate change so before implementing any change, you need to ask: What additional value do I bring to my customers, employees and other stakeholders?Anne Egros, global executive coach Many people hate change, yet others look forward to it. Resistance to change is normal yet a very destructive thing. Some managers fail to recognise the symptoms of change as directly related to proposed or actual changes, such as high staff turnover, conflict, lateness, mistakes, injuries, low morale and lowered productivity.Eve Ash, Australian psychologist and managing director of Seven Dimensions Excellent firms don’t believe in excellence, only in constant improvement and constant change. Winners must learn to relish change with the same enthusiasm and energy that we have resisted it in the past.Tom Peters, American writer on business management practices Change is good. It’s also often hard. The status quo can be so much more comfortable. But to succeed in business, you must run towards it. This is the fastest-changing communications and technology landscape we’ve ever been in. Twenty years ago, you probably didn’t have an email address, and now it’s hard to imagine life (or your business) without email. Ten years ago, Facebook didn’t exist, and now one-and-a-quarter billion people and millions of businesses use it to communicate. Even if you’re not directly involved in the communications or technology industries, there’s no doubt that technology has played a huge role in changes in your industry. These changes mean you have to change.Dave Kerpen, New York Times bestselling author of Likeable Social Media and Likeable Business Progress is impossible without change. And those who cannot change their minds, cannot change anything.The late George Bernard Shaw, Irish playwright and co-founder of the London School of Economics

4 min read

In Safe Hands

INEOS is obsessive about safety. It has to be. Lives can be at stake if it gets things wrong. But when mistakes are made, INEOS is keen to ensure valuable lessons are learned every time COMPLACENCY kills businesses. And in a potentially hazardous business like INEOS, complacency can also costs lives. One man whose job is to help fight against it is Steve Yee, INEOS Group Safety Health and Environment Director based at Runcorn, UK. “It’s so important that safety is always at the forefront of everyone’s mind,” he said. “We all know that the sustainable long-term future of our businesses rests on our track record on safety, health and the environment.” Whatever INEOS is doing, though, seems to be working. Last year INEOS’ overall safety record improved 23% on 2013 and its environmental breaches hit an all-time low. “It was our best-ever safety and environmental performance,” said Steve,who collates the Group’s safety reports. He said INEOS had often seen year-on-year improvements but this was one of the biggest. “What has been particularly pleasing is to see sites, which were not among the best safety performers, showing improvements,” he said. “When that happens, it shows very clearly what can be achieved if we set our minds to it.” INEOS recently switched to OSHA (Occupational Health and Safety Administration), a stricter, US-based system of recording workplace accidents, injuries and illnesses so that outsiders 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 Steve. “But whilst we are catching up, we are still behind.” INEOS views an OSHA performance of 0.23 as being the best in class. “Dow is amongst one of the top performers,” he said. “We are at 0.40.” In December Steve and Simon Laker, INEOS’ Group Operations Director, visited Dow’s HQ in America to understand how it managed to achieve such an impressive performance. “A number of factors came out and a particularly important one is that whilst the OSHA performance may be improving, the number of life-changing injuries is not,” hesaid. “The same is true for us, so clearly we have to be more focused on what we need to do to avoid the more serious injuries and fatalities.” Steve also realised that reporting across all countries needed to be at a high level if INEOS was ever going to see real improvement. “As a management team we are very focused on reporting,” he said. “It’s absolutely no good if the first injury we hear about is a fatality or a loss of limb.” In an effort to make a difference, INEOS launched a group-wide initiative late last year after a member of staff at one of its production sites by-passed a safety system to speed up the job. “New initiatives are always introduced when we review incidents that have occurred because we see what we need to put in place to prevent repeats,” he said. “Thankfully no one was hurt in the incident but it was good that it was reported to us.” The life-saving rules now make it easier for everyone to see what INEOS expects – and also help to ensure the safety basics are in place everywhere. Steve said those rules would be seen by everyone. “What makes it easier to check that messages have been clearly communicated to all and understood is INEOS’ management structure,” he said. “We don’t have a huge corporate headquarters. Each site is very much accountable for its actions.” The rules INEOS introduced seven life-saving rules after a worker bypassed a safety system to speed up his job. Those rules are: No consumption or being under the influence of alcohol or drugs on company property No smoking outside dedicated smoking areas No work on live equipment/machines to commence without authorisation Safety critical devices/interlocks must not be disabled or overridden without authorisation Persons working at height must use proper fall protection No entry to confined space without authorisation and gas test Lifting & hoisting – no unauthorised person to enter the defined danger zone where objects can fall

4 min read

Breaking The Mould

The late Steve Jobs had a strategy and a vision for Apple and it started with the customer, not the engineers or the company’s awesome technology. The focus was always on the incredible benefits Apple could give its customers. Styrolution shares that vision STYROLUTION has come a long way since 2011. For the staff it has been quite a journey. For the customers, it has been proof that industry consolidation can work together for the greater good. Today INEOS Styrolution is a wholly owned business having bought BASF’s 50% stake in the 2011 styrenic plastics joint venture for €1.1 billion last year. And the future for the customers – if it is at all possible – looks even brighter. The automotive industry will be among those to benefit most from INEOS’ latest decision to merge two of its businesses and create a one-stop shop for styrenics, which makes plastics for car components, electronic devices, household appliances, medical equipment, packaging and toys. “It is something that no other company can offer on this scale,” said INEOS Capital Directorand Styrolution chairman Andy Currie. “And that is powerful for us and our customers.” The decision to merge INEOS Styrolution and INEOS ABS was made in March this year – just months after INEOS acquired BASF’s share in Styrolution, the global market leader for styrenics. Andy said the merger made perfect sense and offered ‘further tremendous opportunities for growth’. INEOS ABS is the largest producer of styreneacrylonitrile polymers in North America and is well known there for shaping the interiors of cars. INEOS Styrolution, which operates 15 manufacturing sites in nine countries, has historically had a stronger position in exterior automotive applications. “The businesses complement each other beautifully,” said Kevin McQuade, CEO, INEOSStyrolution. “High performance and premium aesthetics are key buying criteria for our customers in the automotive industry. And that’s what sets our products apart. We are passionate about giving our customers the best solution. It is in our corporate DNA.” He added: “In the past, we may have had both companies competing for the same business but now we can build upon each other’s strengths to provide customers a more comprehensive offering.” At the recent international NPE trade show in Orlando, Florida, INEOS Styrolution and INEOS ABS shared a booth and offered customers a glimpse of the future. “We were able to show them that the possibilities of styrenics are endless and they were excited by what they saw,” said Kevin. “Quite simply we have always been helping others to shape the future of the automotive, healthcare, electronics, household, construction and packaging industries through styrenics.” INEOS and BASF had formed the joint venture in October 2011 amid challenging market conditions. Overnight they created a truly global business and secured their number one place in the global styrenics market with a world-class, global manufacturing platform offering customers supply security, access to the very best technology and a broad product and service portfolio. Together they were also stronger and more efficient. And within two years – instead of the forecasted five – they had generated €200 million in cost savings. “We created a completely different and unique company,” said Kevin. “It was a game-changer.” {} As part of the joint venture agreement, though, INEOS always had the right to buy out BASF – a decision it took in November last year. INEOS chairman Jim Ratcliffe described the acquisition as another important step in the growth of the Styrolution business. “We are pleased to bring Styrolution fully into the INEOS family,” he said at the time. INEOS Styrolution is now a wholly-owned INEOS business – and looking to expand. “Styrolution already has a global asset footprint but new markets are emerging,” said Kevin. “We intend to expand our footprint in Brazil and in Asia, particularly China. This is an outgrowth of our Triple Shift strategy, which calls for expanding our position across customer industries, standard ABS and styrenic specialties, and emerging markets. With plants all over the world, there is no need to ship goods from Europe to America or vice versa. The goods are on the doorstep of our customers. We really are a truly global business within INEOS.” INEOS Styrolution sells its products to the automotive industry as granules. Those granules are then further processed by manufacturers to make and shape parts, for example, for cars. “Whatever they can imagine, they can make,” said Kevin. Another industry which works closely with INEOS Styrolution is the construction industry – and it shows. “Our customers in the construction market are at the leading edge of innovation and are continually challenged to bring higher endurance, longer lasting, more cost effective and aesthetically-pleasing products to the marketplace,” said Thomas Hazenstab, Specialities Business Director. Together they have created products such as decking, fencing and railings that fare better in bad weather and can also withstand high temperatures. “We pride ourselves on working closely with customers to develop new products that meet their specific needs,” said Thomas. “It’s about setting industry trends. We want to offer the best possible solution to give them a competitive edge in their own markets.” Kevin said innovation had been key to the business’ success and would be, even more so, in the future. “To thrive in the specialty markets, we need to create added value through innovation for our customers,” he said. “That’s why we enter into collaborative innovation with our customers to develop new styrenic solutions for the products of tomorrow. Cutting-edge solutions and applications, product and process innovations differentiate us from our competitors and foster our preferred partner position.” Styrolution is also the leading, global supplier of styrenics to the electronics industries, which also ensures computer casings and monitors are strong and heat resistant. A major part of printers made in the world today contain Styrolution polystyrene or ABS products. Both Styrolution and INEOS ABS are also expected to benefit from the merger by reaping synergies which will enhance the efficiency of the business. Core functions such as marketing and sales, customer service, research and development, supply chain, manufacturing, finance and human resources are being merged and best practices are being shared. Not only will this benefit the whole organisation but customers will enjoy the advantage of having a central source to fulfil all their styrenics requirements. “There have been a lot of changes for people within the business,” said Kevin. “But for our customers, the key message has been continuity. If there are any changes, they will be for the better. This company is in it for the long-term.” www.styrolution.com Styrolution vid 2

14 min read

INEOS Gains Interest Of Lenders

INEOS is not one to miss an opportunity, especially when it comes to managing its financial affairs more efficiently. And this year has been no exception A robust performance and INEOS’ reputation as a company that can make money helped it to iron out three separate deals during the first half of this year – and slice a further €80 million off its annual interest bill. “Although it means investors won’t make as much money in interest, it means INEOS can focus on strengthening the business, and is seen as a better ‘risk’, which is always good for lenders,” said Peter Clarkson, Head of InvestorRelations at INEOS. The money saved in interest payments, on the latest €4 billion debt to be refinanced, is likely to be reinvested in the business. “It is hard to say exactly what will be done with the extra cash flow,” said Peter. “But what it does do is give us more flexibility when we are considering business improvements or even some bolt-on acquisitions, to which we remain alert and opportunistic.” Over the past four years INEOS has – in a succession of tactically smart moves – refinanced the $9 billion it borrowed in 2005 to buy Innovene, BP’s olefins, derivatives and refining subsidiary. And in doing so, it has helped to save the company €405 million in interest charges. “Since 2011 we have been in a process to improve the debt structure of the group after the restrictions that were put in place after the financial crisis of 2008,” said ChiefFinancial Officer Graeme Leask. “That is what has enabled us to reduce our cash interest bill from €763m in 2010 to €358m now.” In April 2012 INEOS made history in the financial world when it achieved the largest-ever covenant-lite loan for a European company and the largest globally since the credit crunch began in 2008. Michael Moravec, head of European high-yield syndicate, described it as a staggering achievement by a company. “Management can now concentrate on what it does best, which is managing a chemicals business,” he said at the time. INEOS has now refinanced most of its loans that were nearing maturity. “Taking out the next big tranche of debt requires us to pay a significant premium now, but the premium will reduce and may be a more attractive proposition next year,”said Peter.

2 min read

INEOS channels energy into new TV show

It hopes IN:TV, which will be broadcast from a different site every month, will strengthen the bond between its growing, global workforce and the company. INEOS External Affairs Director Tom Crotty, who will host the 15-minute programme, will be joined each time by a special guest presenter from the local plant. “In just 17 years INEOS has grown from nothing into a global chemicals’ giant with over 53 manufacturing sites around the world and nearly 20,000 employees,” he said. “Sometimes communicating to so many people is a real challenge.” The first episode was filmed at Grangemouth in Scotland where Tom was joined by Jennifer Prentice, an award-winning chemical engineering graduate in O&P UK. “I really think with the innovation of IN:TV that we are leading the way in staff communications for the petrochemicals sector,” said Tom. “And given the importance of video and social media to the younger generation, who represent our future employees, and customers, we want to provide as much information as possible to them.” Each episode will highlight the latest news from around the group but employees will also be given the chance to ask chairman Jim Ratcliffe any questions. The programme is online – for all to view – at www.ineos.com/intv

3 min read

Insight and Ingenuity join INEOS’ fleet

TWO state-of-the-art ships commissioned by INEOS to transport tons of liquefied ethane gas from the USA to Europe have been officially named. JS INEOS Insight and JS INEOS Ingenuity began work in July. Emblazoned on the side of one of the huge vessels is ‘shale gas for manufacturing’; the other bears the slogan ‘shale gas for chemicals’. The ships were named at Qidong near Shanghai, where the first of a fleet is being built for INEOS by SINOPACIFIC. Offshore and Engineering, one of the largest shipbuilders in the world. Each ship is the length of two football pitches and can carry 40,000 barrels of ethane. Steffen Jacobsen, CEO of Evergas, the Danish gas shipping company that designed, leased and operates the vessels, has worked in the shipping industry for 35 years. “These ships represent a world first on many levels,” he said. “No-one has ever tried to ship ethane in these quantities and over this distance before. To do this, we had to invent completely new ways of doing things. These ships are truly unique.” The naming ceremony marked the latest landmark in INEOS’ $1 billion global project to bring shale gas from the USA to its manufacturing plants in Norway and Scotland. INEOS will be the first company in the world to opt to ship shale-gas derived ethane from America where the gas has led to a renaissance in manufacturing. Jim Ratcliffe, INEOS founder and chairman, said the scale of the project, which will help revolutionise the European chemicals industry by bringing US economics to Europe, was extraordinary. “We’re going to move more than 40,000 barrels of gas a day, every day of the year, for 15 years, from the US to Europe,” hesaid. “Any way you look at it, this is an extraordinary achievement.” INEOS names its Dragon Ships vid

4 min read

GO Run For Fun breaks record

INEOS GO Run For Fun team has recently staged its biggest-ever event at Queen Elizabeth Olympic Park in London when 6,000 children ran the 2km course alongside a host of Olympians and TV personalities. “We know that many parents worry about their kids eating too much and not getting enough exercise,” said Leen Heemskerk, The GO Run For Fun Foundation Project Director. “The GO Run For Fun charity aims to tackle that problem in a fun way and the huge numbers who took part show that many people share our concerns.” Daley Thompson, the British Olympic gold medal winner, led the charge and handed out some of the prizes. “It was a fantastic day for all the children,” he said. “Everyone had a great time and also learned a bit more about the importance of healthy eating and exercise.” GO Run For Fun is now the world’s biggest children’s running charitable foundation. As well as the run itself, GO Run For Fun also launched a new kids cartoon series based on Dart, the charity’s mascot. Dart TV is aimed at 5 to 10-year-olds and explains the importance of a good diet and regular exercise. During the day Charlie Webster, a former Sky Sports presenter, chaired a round table discussion looking at the need to get children active early if Britain is to tackle childhood obesity. “Physical inactivity is an important factor in the current UK child obesity epidemic,” said Dr PaulSacher, an internationally respected child health and obesity expert. “Considering one in three children are overweight and obese and around 80% of children are not meeting the Government’s physical activity guidelines, it is essential that we support initiatives such as GO Run For Fun.” Daley was joined by Olympic hurdler Colin Jackson, and Commonwealth gold medal winner Louise Hazel. Also supporting the event was Britain’s very own Marathon Man, Rob Young, who has previously set his own world record by running 370 marathons in 365 days. “This was a really important day for GO Run For Fun,” said Jim Ratcliffe, INEOS Chairman andfounder of GO Run For Fun. “On one level, this was about thousands of kids enjoying themselves and learning about the importance of nutrition and exercise. On another level, it is about getting the Government to realise that they need to do much more to help the under 12s get fit and active.”

4 min read