A £16.5 million grant to create 117 new jobs at a new state of the art chemical facility in the North-East and safeguard 747 jobs at two existing plants, was today announced by Trade & Industry Secretary Patricia Hewitt.

The Department of Trade and Industry grant has been offered to Huntsman Petrochemicals (UK) Ltd (HPUK) on Teesside as part of a £205m investment project.

The project is to build a new plant at Wilton, which will be the largest facility of its kind in the world producing.

low-density polyethylene, used in packaging applications, and to upgrade two existing aromatics plants, safeguarding 747 jobs.

Patricia Hewitt said: "This is great news for Teesside and shows that we are committed to high-value manufacturing. The investment will help the cluster to maintain its position as a globally competitive petrochemicals site.

The jobs will create opportunities not just for those employed at the plant, but for the rest of the area too. I am pleased that this project will also help increase and improve local skills.

"Huntsman's decision to make this investment demonstrates Teesside's attractiveness as a high value manufacturing location.

"It also shows that the UK remains the best place for investors to base their businesses in Europe."

Peter R. Huntsman, Huntsman President and Chief Executive Officer, commented: "Teesside is one of the most important of our global locations and we are delighted that we will now enhance our presence here with this large, world class facility.

"It is good news for Huntsman, for the economy of the Northeast and for the UK as a whole. We have worked hard to make it a reality and the faith and confidence of the UK Government has been very important to the process."

Alan Clarke, One NorthEast Chief Executive, said: "The regional development agency worked hard to present the region's case for Government support for Huntsman to DTI, emphasising its strategic role with the chemical cluster and its economic importance to the regional economy."

Huntsman manufacture products for a variety of global industries such as plastics, automotive, footwear, agriculture, health care, textiles, and packaging. Based in the United States, Huntsman employs 15,000 people, has operations in 30 countries and in 2003 generated revenues of more than $9 billion.