US shale gas to safeguard North East jobs on Teesside

Saudi Arabian petrochemicals company to import cheaper supplies of US shale gas for Teesside plants


Grangemouth operator Ineos already plans to bring in US shale gas

The owner of Britain’s largest petrochemicals plant in Teeside plans to import shale gas from the US for the first time in a move that could help safeguard 700 jobs in the North East.

Saudi Basic Industries Corporation (Sabic) said that it has reached a preliminary agreement with a shale gas supplier in the US to supply feedstock for its facilities at Wilton and the North Tees for the next 10 years.

Petrochemicals production in the UK has been under pressure for a number of years due to dwindling supplies of gas feedstock and naphtha. Scottish plant operator Ineos has already secured supplies of US shale gas for its facility at Grangemouth, which was nearly shutdown two years ago.

Cheap shale gas supplies have helped revitalise petrochemicals industries in the US and create thousands of jobs especially in previously depressed areas along the Ohio River. It is hoped that the arrival of US shale gas in the UK and the development of local supplies could help safeguard the industry in Britain.

Trillions of cubic feet of shale gas are thought to commercially reachable across the North of England and Scotland, however tapping this recourse has so far proved to be controversial with environmental lobby groups staunchly opposed to fracking.

Sabic, the world’s largest petrochemicals company, is investing up to $70bn (£43bn) through to 2020 on huge industrial petrochemical cities visible from space built on land around Jubail on the Persian Gulf coast and Yanbu near the Red Sea.

The company’s acting chief executive Yousef Abdullah al-Benyan told Reuters that the US shale gas deal for Teeside would also be renewable beyond 2025.

Source: The Telegraph

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