SABIC Converts Teesside Plant to US Shale Gas

At a glance
  • The conversion project is set to be completed in 2016.
  • The plant will use competitively priced US shale gas.
  • The project includes building a cryogenic tank at North Tees.
  • The UK government has contributed over €11m from the Regional Growth Fund.

Project Overview

SABIC UK is converting its Teesside plant to utilize US shale gas, a significant investment aimed at making it one of the most competitive facilities in Europe. The project is expected to be completed in 2016 and will secure the long-term future of the plant, which is crucial for the local industry.

Employment and Economic Impact

The Teesside plant employs 1,000 staff and contractors and supports around 4,000 jobs in the supply chain. The conversion is part of a series of measures to future-proof the plant after a global drop in demand for its products. The plant, built in 1979, produces essential chemical building blocks but has faced competition from cheaper foreign manufacturers.

Infrastructure Developments

As part of the project, a cryogenic tank is being constructed at the North Tees site to serve as an import terminal. Darlington-based Whessoe has been contracted for this work. The UK government has also supported the project with over €11m from its Regional Growth Fund.

Government and Local Support

Universities, Science and Cities Minister Greg Clark highlighted the investment as a sign of confidence in Teesside and the UK economy, noting its positive impact on local employment. Redcar Lib Dem MP Ian Swales also praised the investment, emphasizing its potential to transform the Tees Valley economy and attract further investment.

Restructuring Efforts

The company has been undergoing a restructuring process, which included the loss of 110 jobs across its Teesside sites. This restructuring is nearly complete, positioning the plant for a more competitive and sustainable future.