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AP Møller Holding, the Maersk family’s investment group, has thrown its weight behind efforts to cut fossil fuels from plastics production, in an attempt to crack one of the biggest climate challenges.
The group has been developing plans for a €1.5bn plastics factory in Antwerp, Belgium, that would use green methanol, made from low-carbon hydrogen or biomaterial, and run on green electricity.
It has set up a new company, Vioneo, to develop the plant that it said would be the first in Europe to produce plastics at scale without using fossil fuels, in a potential boost to the continent’s industry.
“The European chemical industry is effectively a bit of a sunset industry,” said Jan Nielsen, chief investment officer at AP Møller Holding. “I think this shows a potential future.”
Plastics, critical to essential products ranging from packaging to medical equipment, are typically made from fossil fuels such as gas, coal and oil.
The OECD, the Paris-based intergovernmental organisation, estimates that plastics account for about 4 per cent of global greenhouse gas emissions over their lifecycle.
The plant planned for Antwerp’s Vopak Energy Park would instead use methanol made either from biomass or by combining hydrogen and biogenic carbon dioxide.
It aims to produce about 300,000 tonnes per year of polypropylene and polyethylene, amounting to about 0.14 per cent of the current global market for the two types of plastic.
“It’s a tiny drop in the ocean but an important first step,” said Nielsen. Vioneo would eventually aim to develop further plants.
The company, which has hired Alex Hogan from multinational chemicals group Ineos as its chief executive from November 11, is working towards taking a final investment decision in 2025 to get up and running during 2028.
It faces several hurdles, however, such as sourcing the 800,000 tonnes per year of green methanol needed, securing low-cost green electricity and striking contracts with buyers willing to pay a premium for a greener product.
Jan Secher, chair of Vioneo, said it was in “advanced discussions” with unnamed global brands interested in buying the product, with interest shown by European companies one reason for developing the plant in Antwerp rather than elsewhere.
“Europe as a region is pushing the transformation of sustainable chemical production, much more than the other regions,” he said. “Customers here in Europe are open to that approach. Our logic is that we want to be close to these customers.”
Vioneo is preparing to apply for financial support from the European Commission’s Innovation Fund, while AP Møller Holding, which is funding the project, aims to eventually bring in new investors.
“We will at some point in time move to get co-investors,” said Nielsen. “[But] we believe it’s better to mature the project before [hand].”
The potential investment comes as concerns rise about Europe’s competitiveness compared with the US and China, with some companies warning red tape created by climate laws is strangling the region’s growth.
Sir Jim Ratcliffe, the petrochemicals billionaire who founded and chairs Ineos, in February blamed Europe’s “suffocating bureaucracy” for deterring investment.
The Maersk family founded the AP Møller-Maersk shipping and logistics group in the early 1900s.
They went on to develop the AP Møller Group that invests in sectors ranging from offshore wind to medical diagnostics, which they still control. AP Møller Holding is the parent company of the AP Møller Group.