Borealis to retender the majority of contracts for PDH construction site in Kallo, Belgium, after termination of all contracts with IREM

• Termination of all contracts with the IREM group, originally in charge of 80% of the construction work and 80% of average 1200 workers on site
• As a consequence, only a minor part of the construction work for propane dehydrogenation (PDH) plant mega project in Kallo, Belgium, can resume
• Additional social controls implemented to remedy any potential lack of control by some contractors to ensure compliance with Belgian labour law

In light of recent media reports of alleged misconduct and the ongoing inspection by the Belgian authorities regarding Borealis’ contractor IREM at the construction site for the new PDH plant in Kallo, Borealis decided to terminate all contracts with its contractor IREM Group after having suspended the contracts on 27 July 2022.
For large construction projects, Borealis works together with specialized construction companies. The IREM Group was in charge of 80% of the remaining construction work and the majority of average 1200 workers on the PDH construction site in Kallo. The terminated contracts for both highly specialised piping and mechanical works, as well as electrical and instrumentation works, now need to be retendered. This process will cause a substantial delay for the progress of the construction works.
Borealis has implemented these additional social controls to ensure that the remaining contractors entering the site are fully compliant with Belgian labour law:

• Each (sub)contractor must sign a formal binding declaration prior to start-up in which they again formally confirm to be fully compliant with applicable Belgian labour, social security and tax laws.
• Each (sub)contractor must provide Borealis a list of all personnel before starting to work on the site and confirm for every individual that they are fully compliant with the applicable Belgian labour, social security and tax laws prior to start-up.
• All employees and (sub)contractors are being proactively briefed and continue to be encouraged to make use of Borealis’ ethics hotline. This tool was launched in 2021 and is accessible for Borealis employees and externals and allows for ethics-related concerns to be filed in 24 languages.

“We are taking all necessary steps to ensure that the remaining contractors entering the site are fully compliant with Belgian labour law. As a first step we have terminated all contracts with our contractor IREM, who was in charge of 80% of the works on site. We have also implemented additional social controls well beyond industry standards to identify and address any potential lack of control by (sub)contractors who are not compliant,” commented Wim De Smet, Borealis Location Leader Kallo.

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