INEOS Exits Tianjin Petrochemical Venture Amid Weak China Market

INEOS has officially withdrawn from its petrochemical joint venture in Tianjin with Sinopec, citing prolonged weakness in China's petrochemical sector. The decision, confirmed in the company's second-quarter financial results, marks the completion of an exit process that began after deteriorating market conditions reduced the project's commercial viability.

The Tianjin complex was launched in 2023 as a 50:50 partnership between INEOS and Sinopec to develop a large integrated petrochemical facility. The project included a 1.2 million tons/year ethane cracker, 500,000 tons/year HDPE plant, 350,000 tons/year HDPE/LDPE swing unit, and a 350,000 tons/year polypropylene plant. Commercial operations had originally been targeted for late 2024, but persistent oversupply, weak demand, and squeezed margins across China's petrochemical industry delayed progress and weakened investment prospects.

According to the company, discussions on exiting the project started in 2025 as losses from the Tianjin investment continued to impact financial performance. During the review process, INEOS determined that it no longer had significant influence over the project, leading to the investment being reclassified from a joint venture to another investment category in September 2025. Exit agreements signed with Sinopec in June 2026 have now completed the withdrawal, allowing INEOS to remove the investment entirely from its balance sheet.

As part of the settlement, INEOS will pay $120 million to Sinopec in equal installments over 24 months, with payments scheduled to begin in March 2027. The remaining obligation will be recorded at amortized cost until repayments commence.

Despite leaving the Tianjin project, INEOS confirmed that its other operations in China will continue. The company will retain its 50% stake in the SECCO joint venture in Shanghai as well as its ABS joint venture with Sinopec, although it acknowledged that SECCO continues to weigh on earnings due to ongoing market challenges.

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