Dutch nitrogen concerns halt billion-dollar project in port of Antwerp

In Belgium they are now also starting to feel the consequences of the Dutch nitrogen crisis. For years, many Dutch nature areas have been overburdened by the precipitation of nitrogen, resulting in less construction. Now the same problem is also paralyzing construction projects in Flanders.

Three weeks ago, the Flemish Council for Licensing Disputes halted the construction of a large ethane cracker in the port of Antwerp. In an ethane cracker, ethane is converted into ethylene, the raw material for plastic, among other things. This so-called Project One is a mega investment of approximately 4 billion euros from the company Ineos, the private chemical group of British billionaire Jim Ratcliffe.

In the permit, the judge argued, it was not sufficiently clear what effects the nitrogen emissions from the factory would have on the Brabantse Wal nature reserve. That hilly, wooded area is located in the Netherlands, near Bergen op Zoom – against the port of Antwerp. Because it already suffers heavily from nitrogen precipitation, every extra gram that falls there is too much, the judge ruled.

Bridging loan

Before construction can proceed, it must be clearly demonstrated that Project One will have no adverse impact on the area. That has not happened now, said the judge. The Flemish government has proceeded “routinely and carelessly” when granting permits, according to the ruling.

The case against the permit was, among others, brought by the Dutch provinces of North Brabant and Zeeland, in addition to a handful of Belgian nature organisations. This makes Ineos a striking case. There has been much discussion in Belgium about the nitrogen emissions from the factory for some time now: just like the Netherlands, Flanders is increasingly struggling with a nitrogen problem. But in the end it is the overburdened state of Dutch nature that threatens to destroy the factory and has led to a lot of panic in Flemish politics.

The potential consequences of canceling the license are far-reaching. The Flemish government, which consists of liberals and Christian Democrats, fears the end of the factory. The company, which said it was “disappointed” after the ruling, must now better substantiate that Dutch nature is not being burdened too heavily. Without a permit, banks cannot provide a loan, which could cause the project to run out of money. Because: despite the fact that construction has come to a standstill, bills continue.

Last week the Flemish business newspaper reported The time that Ineos is looking for a bridging loan of 400 million euros, with the Flemish government guaranteeing a large part: this so that banks could still provide money despite the lost license.

Other motifs

It is very important to Flanders to let the project go ahead. It is “the investment of the century” according to Antwerp mayor Bart De Wever. For the Flemish government and the city of Antwerp, Project One is a prestige project: everything possible was done in 2019 to trump Rotterdam as the location for the new factory. This is the largest investment in the port in ages. If, after many years, it suddenly turns out not to be possible to build the factory, it will reflect badly on the business climate of Belgium as a whole, or so it is feared.

Environmental organizations and green parties have been critical right from the start. Why does Ineos want to build a factory for the raw material for plastic, now that the world has to work towards a circular economy? Moreover, a cracker emits a relatively large amount of CO₂ even though Ineos’s will be one of the most efficient in the world – the company itself often insists that this will be the cleanest ethane cracker in the world. “But the basic story is just not right,” says Mieke Schauvliege, parliamentarian for Groen in the Flemish parliament. “You should not build these kinds of new installations, but dismantle the old ones.”

The objections were of no avail, and Ineos remained silent for years as preparations for construction progressed. Until the opponents threw it over the nitrogen bow, including the Dutch provinces. North Brabant and Zeeland objected to the permit, formally because of the nitrogen emissions that would damage Dutch nature reserves.

However, the provinces acknowledge that they also have other motives for their objection. Zeeland says it wants to show that it is “sharply” watching the emissions from Antwerp and is not afraid to take “legal paths”, the province writes in internal minutes that have been made public through the Open Government Act (Woo). The province also says it sees the case as a means of pressure for the government to act against projects across the border, and it shows environmental organizations that it takes “this problem” seriously.

PR offensive

Ineos is not the only Belgian project that the Netherlands is obstructing. Over the past few years, for example, the province of North Brabant has repeatedly objected to expansions of livestock farms across the border, because this would cause more nitrogen to settle in the province.

In South Limburg, there has been dissatisfaction for years about the plans for a Belgian biomass plant that is planned just across the border, in the town of Lieze. The building plans caused irritation in Limburg, because the province felt that it had been poorly informed about this. The municipality of Eijsden-Margraten, Maastricht and the province fear that various harmful substances will blow into the Netherlands – including nitrogen.

That is why the municipality of Eijsden-Margraten recently approached the Belgian Council of State. Incidentally, this also applies to a number of Flemish municipalities: they object to the biomass plant, which should be located in Wallonia, because they fear that nitrogen will also precipitate in Flanders.

According to Flemish media, Ineos is now working on a new permit application, in which it better maps out the consequences for nature. It is therefore not yet certain whether the factory will eventually be built. A possible other solution has come into the picture more quickly due to the court ruling in the matter: two parties in the Flemish coalition have wanted to set a nitrogen threshold since the Ineos debacle, whereby projects with low emissions could relatively easily continue. However, the Christian Democrats are not a fan of this, because this proposal makes a distinction between emissions from agriculture and those from industry. That is not fair to the party.

In the meantime, the government is trying to reassure Ineos CEO Ratcliffe as much as possible: according to the VRT, there has been a lot of contact at the highest level in recent weeks. Ratcliffe himself launched a clear PR offensive. In a big interview in De Tijd he linked the cancellation of the license to an apocalyptic image of a Europe without industry. “Does the continent want a chemical sector at all?”