ONE of the engine rooms of the Scottish economy, Grangemouth is suddenly at a crossroads as two developments potentially threaten its future.
Concern is mounting over a planned container port at Rosyth that opponents say is unnecessary, as Grangemouth is already operating below capacity.
Now the media-shy Jim Ratcliffe, chairman of petrochemicials company Ineos, has warned that the oil refinery in the Stirlingshire town may have only two more years life left in it.
Given that the Scottish economy is supposed to be on the mend, these are not the sort of messages that will comfort government ministers, let alone the hundreds working in the port and refinery in Grangemouth.
The arguments over Babcock’s plans for a container terminal at Rosyth are spelled out on this page. Finance Secretary John Swinney is being drawn into the row after Transport Minister Keith Brown refused to meet Forth Ports boss Charles Hammond, who says he is not afraid of competition, but believes there is no economic case for another terminal.
There are also questions over proper procedure, and one of the SNP’s own parliamentarians is now demanding answers.
On the face of it, reinvigorating a derelict site at Rosyth and creating jobs is no bad thing, but if it risks damaging other facilities then it is another matter. There is already overcapacity in the industry and more is due to come on stream before Rosyth opens.
Ministers seem determined to approve the Babcock plan, but the concerns of a widening spectrum of interested parties should demand further investigation before a decision is taken.
The oil refinery’s problems, as reported in The Scotsman yesterday, revolve around £200 million of losses over the last three years. The plant is short of North Sea gas needed to run it, and its costs, including pensions for staff, are too high.
The company has denied suggestions that it may close Grangemouth, which it bought from BP in 2006, but Ratcliffe’s comments to the media when he talks of “only one ultimate destination unfortunately” and “to have a future it needs cheap feedstocks” are hardly reassuring.
The unions have accused Ratcliffe of using scare tactics ahead of talks on pensions and investment at the site.
But Ratcliffe says the refinery has “not been a successful asset” and appears to be preparing the workforce for a big decision. A crisis could be avoided if the company secures help from the government, but with cost pressures mounting, the plant’s future rests on a deal with the unions. They should be careful not to ignore his warnings.
Boom times at Skyscanner
Skyskanner, the flight comparison website, last week confirmed it was buying a Spanish company, as revealed in Scotland on Sunday last weekend and confirmed in The Scotsman on Friday. The undisclosed deal for Barcelona-based hotel search specialist Fogg will allow the Edinburgh company to bring hotel searches in-house.
These are boom times for Skyscanner, launched ten years ago and now operating from some of the swankiest offices in the city at Quartermile, where the headcount is rising fast.
Fogg follows the acquisition of Zoombu, a point-to-point travel business, two years ago, and after capturing a large slice of the Asia-Pacific market Skyscanner is targeting the Americas.
Skyscanner is emerging as one of Scotland’s flagship technology companies, and the company’s boss, Gareth Williams, has not ruled out a flotation, though the company’s growth and potential will surely catch the eye of predators at some point. Either way, it should provide another chunky payday for Scottish Equity Partners, one of its early investors.
High hopes for reborn TSB
The return to the high street of an independent TSB is being heralded as the rebirth of simple banking. Let’s hope so, as the “new” kid on the block it has a lot going for it. There are no bad loans and it launches as switching banks is to be made easier.
However, some customers have opted to stay with the devil they know – Lloyds. New TSB boss Paul Pester may have a decent hand, but in a competitive game it is about who blinks first.