🔗 Share this article

Prior to this week's £50m state rescue package for its Grangemouth facility, chemical companies under the ownership of tycoon Jim Ratcliffe had already been granted as much as £70m in UK state aid over the past four years.

Recent Revelations and Financial Support

Based on government disclosures published this week, state aid to Ratcliffe's chemical empire in the last year alone ranged from £16m and £38m. Since August 2022, the conglomerate has obtained between £28m and £70m.

The government stepped in on Tuesday to grant Ineos with £50m to prop up its Scottish ethylene plant, fearing that otherwise the UK would lose its last remaining facility manufacturing ethylene—a vital feedstock for plastics. Officials additionally supported a £75m loan guarantee, while Ineos pledged to invest £30m of its own funds.

Refinery Shutdown and Broader Context

This intervention comes following Ineos shut down the adjacent oil refinery in September 2024, costing 400 jobs—a move described as a huge blow to the local community and a political problem for the government.

The billionaire, with an estimated net worth of $14.5bn, reportedly asked for government assistance in October. This appeal comes at a time when the expansive Ineos group, controlled by the 73-year-old, has been under considerable economic strain, in part due to soaring energy costs in the wake of Russia's full-scale invasion of Ukraine.

In a sign of increasing concern over its financial health, Fitch Ratings lowered Ineos's debt rating in September. Ratcliffe has also had to commit significant funds into his off-road vehicle venture and the turnaround of Manchester United, in which he holds a minority stake.

Form of Support and Company Statements

Most the previous state aid was delivered in the form of tax breaks in exchange for “commitments to reduce energy use and CO2 output.” The value of these relief schemes for Ineos's sites in Grangemouth and Hull are reported as ranges rather than precise figures.

An Ineos spokesperson said the aid did not constitute “favourable terms” for the company, but was “awarded against strict criteria, and available to any UK business that qualifies.”

While Ratcliffe publicly welcomed the £50m support in an announcement, Ineos also released sharper remarks. In these, the billionaire strongly criticised government policy, including carbon taxes paid by industrial users.

“The answer is NOT decarbonisation by deindustrialisation,” he stated. “Without a strong manufacturing base, the economy will continue to decline. Soaring power prices and punitive carbon charges are pushing industry out of the UK at an unsustainable pace.”

In further comments, Ratcliffe labelled carbon taxes as “an extremely foolish levy in the world,” contending they put UK plants at a disadvantage against foreign rivals. It is noted that most chemicals and plastics are not covered from the UK's planned carbon import tax.

Investment and Environmental Pledges

The Ineos representative further stated: “Ineos has invested over £400m at Grangemouth in the last five years to maintain its status as one of the most productive chemical plants in Europe and to protect skilled jobs. British industry has had a brutal year, yet society depends on this industry every day. Should we fail to manufacture these critical products in the UK, they are imported instead, often from more polluting operations abroad.”

Colin Pritchard, head of sustainability for the company's chemicals unit, indicated the Grangemouth money would be used to improve energy efficiency, cut carbon emissions, and upgrade plant performance.

He explained the site, which uses an ethylene cracker running on North Sea gas and imported liquefied petroleum gas, had been under “extreme pressure” from rocketing energy costs and the UK's carbon taxes.

It has also been reported that Ineos has in the past obtained substantial tax breaks from the EU, valued at hundreds of millions of euros—notably while Ratcliffe was a prominent backer of the campaign for the UK to leave the EU.