Accompanied by a piper perched on its prow playing the Skye Boat Song, the first Dragon-class supertanker carrying 27,500 cubic metres of shale gas from the USA for the Grangemouth refinery arrived in the UK today after passing below both the Forth road and rail bridges.
Heralded as starting a ‘Grangemouth renaissance’ by securing the jobs of 1,300 people at the INEOS-owned refinery and safeguarding another 10,000 jobs in the supply chain in Scotland, today’s arrival of the 585-ft long ‘INEOS Insight’ is the first of what will be a weekly ‘ferry’ across the Atlantic from Pennsylvania to Scotland via a fleet of eight such ships.
INEOS will use the ethane from the US shale gas in its gas-cracker plant at Grangemouth – where it has built the largest such storage tank in the UK as part of a £450 million investment in the plant – as both a fuel and as a chemical-feedstock.
Jim Ratcliffe, Executive Chairman of INEOS, said; “Almost overnight, the Grangemouth refinery will become profitable – to the tune of £100 million a year – compared to being a loss-maker beforehand.
“Three years ago, this plant was on its knees, working at only 50% capacity because we couldn’t get enough gas from the North Sea.
“The impact of US shale gas on Grangemouth is transformational – just like in the USA, where it has not only transformed the energy industry, it’s transforming the entire US economy.
“High-cost manufacturing in the steel and chemical industries are returning to the US from China because America’s transformed its energy costs by low-price shale.
“Shale gas has had an immense impact on the US economy and was largely responsible for dragging it out of recession after the 2008 banking crash, creating 500,000 new jobs as a result in the most regulated country in the world.
“When you see at first hand the impact shale has had in transforming the economy of the decaying steel industry in Pittsburgh, you just hope that ‘common economic sense’ will prevail in Scotland.”
And Ratcliffe said shale could have the same transformative impact on the UK economy, where manufacturing has ‘collapsed’ from 25% of GDP to around 10% today.
He added; “It is not sustainable for the UK as the world’s fifth-largest economy to be built almost entirely on the service-sector.”
His message was rammed home with the legend – SHALE GAS FOR MANUFACTURING – emblazoned in huge capital letters along the hull of the INEOS Insight.
Ratcliffe said: “This is a hugely important day for INEOS and the UK. We are very excited about the kick-start shall gas can give to British manufacturing.
“We are nearing the end of a hugely ambitious project that has taken us five years in planning and delivery, and cost $2 billion in total to begin supply of ethane from shale to out sites in Europe <Grangemouth, near Edinburgh, and Rafnes in Norway>
“This is a world-first and I’m incredibly proud of everyone involved in it – I also believe that INEOS is one of the very few companies in the world that could have successfully pulled this off.”
While INEOS has secured the long term future of Grangemouth with US shale gas imports, the company still hopes to secure and even more economic supply of local shale gas in Scotland from the shale exploration licences it has been issued with by the UK government.
But it has been stymied by the ‘temporary’ ban on planning applications for shale gas exploration imposed in January last year by the minority SNP-led Scottish Government.
Ratcliffe had urged Nicola Sturgeon, the Scottish First Minister, to at least allow INEOS to drill exploratory wells to ascertain the scale of shale reserves in its Central Belt licences while the Scot-Govt carried on with its own, second scientific analysis of the evidence on the public safety risks related to shale exploration.
This was rejected by Sturgeon, but Ratcliffe added: “Perhaps she should go on a fact-finding visit to Pittsburgh and Pennsylvania.
“In 10 years time, the North Sea will be finished. But – if not shale – what is going to replace that and encourage inward investment in manufacturing in the UK?
Not only was Sturgeon not present at the VIP party which welcomed the INEOS Intrepid to the Forth, neither the Scottish Energy Minister or the Business Secretary were in attendance.
But David Mundell, MP, the Secretary of State for Scotland in the British Government, gave a warm welcome to the INEOS Insight in congratulating the company on safeguarding more than 10,000 jobs in the Scottish energy supply chain.
He said: “This is a remarkable day for the petrochemical industry in Scotland and in the UK because this is cutting-edge industry which signals a new era in chemicals production at Grangemouth – and it shows that the chemicals business is thriving, with technologies that didn’t exist so Ineos and its partners had to invent them.
“It is a major success story for UK manufacturing and it deserves to be in the limelight as it is today. As Jim <Ratcliffe> has said, people said it couldn’t be done, but INEOS believe anything is possible.
“This project has not only secured jobs during the construction phase, it has secured thousands of jobs here in Grangemouth and all along the supply chain.
“The project has been driven forward by Ineos, and has had vital backing from across the private sector, the Scottish Government and Falkirk Council.
“And I am pleased the UK Government was able to play a crucial role with a £230 million loan guarantee to finance the work.
“I am enormously proud that this was one of the key factors that unlocked the investment necessary to support the project, securing the petrochemical works’ future and the thousands of jobs that go with it both here and elsewhere.”
The SCOTTISH ENERGY ASSOCIATION® is holding the second UK Shale Energy Conference.
After the highly successful first event last year, this second event on 30 September 2016 will take stock of the consultation that the Scottish Government instigated during the moratorium and hear from those for and against onshore shale exploration.
To view the programme click Shale Programme
The full-day Conference will take place on Friday 30/9/2016, with registration from 9.00am and starting at 9.30am, at the Technology & Innovation Centre (TIC), University of Strathclyde, 99 George Street, Glasgow, G1 1RD.
By coincidence, the first Dragon-class shale supertanker from the USA is due to arrive in Scotland on 27 September.
Chaired by Ross Martin CEO of SCDI, speakers include:
- Chris Lewis of EY
- Matt Williams of RSPB
- Hugh Carmichael of INEOS
- Mark Lappin of Complete Exploration & Development
- Bob Gatliff of British Geological Survey
- Julie Hauck of Greenpeace
- Fraser Pritchard of Columbus Energy
- Graham Dean of ReachCSG
- Mike Cooper of Arenite Petroleum
- Ken Cronin of UKOOG
- Alexander Burnett MSP, Shadow Energy Minister
- Colin McNaught of Ricardo.
- Patrick Harvie, MSP, Scottish Green Party
The UK Shale Energy Conference 2016 is an opportunity to find out more about what is going on, the technologies and the validity of much of what is being said in the media. Come along and engage in the debate and see how shale might impact the UK and Scottish energy market. You can view the programme by clicking Shale Programme
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For a DECC video on ShaleGas Click Here
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To see the programme click Shale Programme
The Scottish Energy Association® is the go-to membership organisation for the energy industry in Scotland, dedicated to strengthening commercial ties and ensuring the best possible opportunities for businesses involved across the energy supply chain.
Scottish Energy Association® represents a number of the industry’s leading players, assisting all members in offering them an informed voice across the industry on energy matters to legislators, regulators, decision makers and the media.
Its aim is to be the voice of the energy industry and represent our members, focus on collaboration between companies, liaise with academia on skills for the industry, inform stakeholders and act as a gateway to improving industry, media and consumer dialogue within and beyond Scotland.