INEOS has announced plans to invest €2.7 billion (£2.4bn) in two chemical plants in northern Europe.

One of the plants will be the first new so-called ethane “cracker” to be built in Europe for two decades – it involves taking ethane, a component of natural gas found in the Marcellus shale and processing it – or “cracking” it – into ethylene.

INEOS said it will be one of the most efficient and environmentally friendly facilities of its type in the world.

The second project will be a Propane Dehydrogenation (PDH) plant.

The petrochemicals giant adds both the units will benefit from US shale gas economics.

Jim Ratcliffe, Founder and Chairman of INEOS said: “This is the largest investment to be made in the European chemical sector for a generation. It will be a game changer for the industry and shows our commitment to manufacturing.

“This new investment builds on the huge investment we made in bringing US shale gas to Europe and will ensure the long term future of our European chemical plants.”

The project is expected to be completed within four years.