INEOS takes legal action against Sinopec

INEOS announced that it is taking legal action against a number of Sinopec and Sinopec subsidiaries (SNEC, Anqing and others) for breach of contract and/or misuse of trade secrets. In its statement, INEOS says that Sinopec Ningbo Engineering Company has broken a long established technology agreement which, together with trade secret misuse by other Sinopec companies, has enabled development of a series of new world scale acrylonitrile plants without INEOS agreement or consent. 

INEOS said it has otherwise excellent relationships with Sinopec and with China but has no choice other than to protect its intellectual property. INEOS fears that these breaches of rights will cause major harm to its acrylonitrile business which generates up to $500 million per annum of profit and has a replacement value of $3 billion.   

INEOS is pursuing parallel actions in the Beijing High Court and through arbitration in Sweden. INEOS has every confidence  that China has now developed an excellent system to protect intellectual property consistent with the fact that China now files more patents than any other country.  

INEOS currently leads the global acrylonitrile market. Acrylonitrile is an important molecule which is used to manufacture a wide range of high value goods. It is a key building block for carbon fiber which is essential for a range of highly engineered products in the automotive, aerospace and defence industries.   The new Boeing 787 Dreamliner relies on acrylonitrile based carbon fiber for its construction.   In addition, acrylonitrile is a key ingredient in ABS polymer, used in many everyday applications from children’s toys and computer monitors to white goods.    

The company has had a long standing agreement with SNEC (a Sinopec company) for the licensing and use of acrylonitrile technology in China dating back to 1984. The company believes in the long term development of the Chinese petrochemical industry and is strongly committed to working with companies in China to help them to develop their businesses. INEOS currently has plans to jointly build a phenol plant with Sinopec and an acrylonitrile plant with Tianjin Bohai.