- Scotland’s only oil refinery faces closure.
- Petroineos plans to shift to petroleum imports.
- Hundreds of jobs at risk.
Petroineos intends to convert the location into a petroleum import terminal over the course of eighteen months.
Petroineos announced that Scotland’s sole oil refinery may close in 2025, threatening hundreds of jobs.
The company stated that “significant challenges” have been encountered at the Grangemouth location as a result of global market pressures and the energy transition.
Petroineos intends to convert the location into a petroleum import terminal over the course of eighteen months.
Concerns Raised and Reaction
The refinery is anticipated to remain operational until at least spring 2025, according to the company.
Approximately 500 individuals are employed directly at the Grangemouth location.
Union Unite declared its intention to “examine every aspect in the struggle for employment.” Whereas First Minister Humza Yousaf remarked that “the affected workers will experience a period of great concern.”
Petroineos stated that it was “collaborating closely” with a “variety of interested parties,” including the governments of Scotland and the United Kingdom, on the project and that additional details would be provided “in due course.”
Franck Demay, chief executive officer of Petroineos Refining, stated, “This has no impact on our current operations at the Grangemouth refinery, which are proceeding as usual.” At this time, we expect refinery operations to continue until the spring of 2025.
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“This is necessary to align our operations with the declining demand for our fuels as the energy shift continues.” We must plan accordingly as judicious operators, but the exact schedule for instituting any change is not yet known.”
Political Criticism and Just Transition
The company said the move will “preserve the location as a fuel hub for the nation for decades to come.”
After preparation, vessels can transfer petrol, diesel, aviation fuel and kerosene into Scotland via the Firth of Forth.
Additionally, the organisation plans to advance efforts to facilitate the transformation of its current export terminal situated at Finnart on the Firth of Clyde—connected to Grangemouth via cross-country pipelines—into a facility dedicated to the importation of petroleum.
Mr. Demay continued, “This marks the initial phase of our strategic transition from being a manufacturer of fuel products to becoming an importer of finished fuel products, facilitating their subsequent distribution to customers.”
“At all times, we shall maintain our utmost attention on guaranteeing the secure manufacturing and consistent provision of superior fuels to our clientele in Northern Ireland, Scotland, and the northern region of England.
In addition to commencing this investment in readiness for a forthcoming transformation, we are likewise dedicated to a consistent initiative of dialogue with our colleagues regarding the modifications we are implementing within our organisation.
The proposals “raise concerns for the livelihoods of our members,” according to Unite.
“Unite will hold politicians accountable for their actions and will leave no stone unturned in the fight for jobs,” stated union general secretary Sharon Graham.
Unite Scottish secretary Derek Thomson further stated, “In order to ensure the long-term sustainability of the numerous highly skilled jobs situated at the Grangemouth complex, all viable options must be considered.”
The Scottish Tories called the situation “devastating” for staff and a “hammer blow” to local and national economies.
Additionally, the Scottish Greens criticised the action, describing it as a “horrendous way to treat employees.”
MSP Gillian Mackay stated that plant employees are “bewildered, betrayed, and furious.” They discovered the information through an online article long after shareholders were informed.
A “simultaneous summit” was demanded, and the Grangemouth Just Transition Board was obligated to disclose “what they knew and when.”
“Mistake-freeze, we must transition away from fossil fuels,” she continued. However, this is diametrically opposed to a just transition.
Grangemouth’s Petroleum Industry Impact
Grangemouth, on the Firth of Forth, was one of the first UK petroleum oil refineries, founded in 1924.
It is the only petroleum oil refinery in Scotland and one of six in the United Kingdom.
It obtains its raw materials from hydrocarbon fields in the North Sea, which are imported through the Forties Pipeline System. Also from other regions globally, through a deep-sea terminal situated on the western coast of Scotland.
Friends of the Earth Scotland attributed the announcement to the Scottish government. They argued that the government had “failed to develop credible transition plans in collaboration with site workers.”
Rosie Hampton, an advocate for a just transition, further stated, “Unfortunately, this announcement today is a resounding consequence of the Scottish government’s persistent inability to comprehend this fact and establish tangible transition strategies in collaboration with its workforce.”
Mr. Yousaf stated that the Scottish government was willing to collaborate with Petroineos and trade unions. This collaboration aims to “ensure a sustainable future for Grangemouth” when questioned later on Wednesday.
Moreover, he continued, “This will be an extremely troubling time for the affected employees.”
When asked whether his government is partially to blame for the situation, he responded that the United Kingdom government makes decisions regarding oil and gas licencing. However, he emphasised the need for a “just transition” and “taking the workers along on the journey towards a sustainable future.”
