The UK government is providing a €700m (£600m) guarantee for the billionaire Jim Ratcliffe to build the biggest petrochemical plant in Europe in 30 years that will turbocharge plastic production.
The huge petrochemical plant has been described as a “carbon bomb” by campaigners. Being constructed in the Belgian city of Antwerp by Ratcliffe’s company Ineos, it will bring plastic production to Europe on a scale not seen before, just as countries are trying to negotiate a binding global treaty to tackle the growing problem of plastic pollution.
More than 350m metric tonnes of plastic waste is produced a year, and by 2060 plastic waste is set to increase to 1bn metric tonnes. Antwerp is a key production centre for plastic in Europe and has created pollution from plastic pellets and emissions that supercharge global heating, campaigners say.
But despite admitting the plant’s adverse impact on climate, biodiversity, the environment and the risks to social and human health, the British government has provided financial guarantees of €700m to support the building of Project One in Antwerp.
The support from the UK government’s export finance department, an arm of the Department for Business and Trade, to Ratfliffe, now a high-profile part-owner of Manchester United Football Club, exceeds that promised by the same department for countries in Africa and the Middle East to adapt to climate breakdown.
Ratcliffe has been lobbying politicians in Europe pushing back against green policies which he claims are driving away investment.
Project One will import fracked shale gas from the US, to provide the ethane for the cracker plant that will produce 1450 kilotons of ethylene, which is the building block of plastic, a year.
Details of the financial support from the UK government emerged as environmental NGOs prepared a new legal challenge to stop Ratcliffe building Project One. The UK government argues its financial guarantees are in line with its support for a global transition towards net zero.
But Jacob Kean-Hammerson, of the Environmental Investigations Agency in the UK, said: “Ineos is a big part of the plastic production supply chain and plastic producers themselves.
“By supporting this plant the UK government is financing a huge climate emissions project. What we need is additional funds for climate-related adaptation but the UK is giving more money to a potentially huge emitter than to countries to help them adapt to the impacts of climate change.”
Documents show UK Export Finance (UKEF) is aware of the climate impact of Project One. “The project was deemed to have potential to cause a number of adverse environmental and social impacts both during construction and operation,” the UK documents said.
Officials carried out a “desktop review” rather than visiting the site at Antwerp. They said a “proposed suite of controls as part of the project’s environmental and social management systems, if implemented effectively, should facilitate the management of these impacts”.
UKEF said Ineos had promised to become carbon neutral for Scope 1 and 2 emissions 10 years after the start of operations, which did not therefore hinder the ability of the EU to meet current climate-related policy or international commitments, including the Paris agreement.
An Ineos spokesperson said: “Project One will produce the raw material essential for medical products, insulation, transport and packaging. It will have the lowest carbon footprint compared with any plant of its kind in Europe. And by applying state of the art technology, it has a clear roadmap to carbon neutrality within 10 years of startup. Europe needs to be permitted to renew its manufacturing technology and we will strongly defend this project in the court.”
The production of plastic is, however, hugely carbon intensive. Over 99% of plastic comes from fossil fuels and plastic production is by far the largest industrial oil, gas and electricity user in the EU, according to the NGO Break Free from Plastic. Fossil fuels cannot be replaced as a feedstock in the petrochemical industry, something Ineos acknowledges.
Jeroen Dagevos, of the Plastic Soup Foundation, one of the NGOs challenging Project One, said: “There is a huge problem of plastic pollution from nurdles already in Antwerp and the Netherlands. This plant will bring US-scale plastic production to Europe. The nurdles are everywhere, in the EU alone up to 23bn plastic nurdles end up in the environment every day.
“The plastic pollution is not under control. Almost half of plastic production today is for consumer goods, single-use packaging that will be thrown away. We need the industry to solve the problem of pollution they have created, not build a huge new plant to massively increase plastic production.”
The UK said Ineos had promised that only 10% of the ethylene produced would be used for single-use plastic. The rest will be used for construction goods, including pipes and cable ducting, according to UKEF.
Dagevos said: “How will they monitor this? There are no controls over who is buying the ethylene. This will just boost the production of single-use plastic packaging and throwaway consumer goods in Europe.”
A spokesperson for the government said: “UK Export Finance helps UK businesses to win, deliver and get paid for overseas contracts.
“Our financing guarantee for Project One secures new export opportunities and is consistent with our continued support for a global transition towards net zero.”
Ineos is publicly pushing back against scientific evidence of the human health and environmental and climate impacts of plastic pollution. Research shows that microplastics have been found in human blood for the first time.
The global production of single-use plastic is fuelling global heating and less than 10% of the 7bn tonnes of plastic waste already generated globally has been recycled.
But Ratcliffe’s company says on its website that plastic needs be treated with “less emotion” and defends the production of single-use plastic, saying less than 2g of plastic package protects a cucumber. “This will extend its ‘shelf life’ by 11 days! A little bit of plastic will prevent a whole lot of food waste.”
