New £2bn refinery for Teesside

London - Sonhoe Development Co. has unveiled plans to build a £2-billion crude oil processing facility in the Tees Valley in the North East of England. The project would represent one of the largest single investments in the process industry in the UK in the last 20 years, said Sonhoe - a London-based company that specialises in the development of hydro-carbon processing and infrastructure facilities.

The facility has been designed to process 200,000 barrels a day of heavy crude oil into high quality, low sulphur diesel, petrochemical feedstock naphtha and kerosene for use in the UK or for export. The plant also incorporates the production of hydrogen and would be one of the largest hydrogen producing plants in Europe, said a 10 Oct company statement.

Sonhoe has identified brownfield sites in and around the Wilton International site to locate the main processing units, storage and logistics facilities and the creation of new marine facilities on the river Tees. The development timescale through to completion is five to seven years. The company's next stage is to enter into front end engineering design (FEED) with associated activities to progress permissions, commercial arrangements for crude oil supply and infrastructure preparation.

The development, said Sonhoe, could create up to 400 core employment positions on site and 1500 associated jobs once the plant is operational, according to London-based Sonhoe. The project has backed from the Department for Business, Enterprise and Regulatory Reform, UKTI, One NorthEast, Tees Valley Regeneration and Redcar and Cleveland Borough Council as well as industrial companies in the area.

The plan "is the culmination of several years of planning and outstanding support from the area," said  Mike True, managing director of Sonhoe. "We are still in the early stages of this project but the fundamentals for this facility are very strong – the technology is proven and has been demonstrated to work in many other facilities around the world."

The project has also received support  from Paul Booth, president of SABIC UK Petrochemicals, which is currently establishing world-scale polyolefin production facilities at the Wilton site.

Booth, who also leads the NEPIC - North East Process Industry Cluster - GDP Growth Strategy Team, commented: "In principle, SABIC welcomes any initiative which supports the development and expansion of the chemical industry on Teesside. The potential offered by the Sonhoe project for more locally-arising feedstocks to become available as well as the possible synergy benefits that may come into play are very positive scenarios for the processing industry in the North East region."