'Industrial vandalism': Petroineos issue major update on Grangemouth refinery closure

The Grangemouth refinery has now ceased processing crude oil, its owner Petroineos has confirmed, as Scotland was branded as being “a victim of industrial vandalism and devastation”.

The company said in September last year the refining activities would cease in 2025 as it transitions to becoming an import terminal for finished fuels.

Scotland's only oil refinery at Grangemouth has officially ceased processing crude oil | Michael Gillen/NationalWorld

The impending closure of the refinery, which first opened in 1924, led to fears for employment in the area. In recent months, hundreds of workers have taken voluntary redundancy while a number of compulsory redundancies have also been made.

A significant report commissioned by the Scottish and UK governments, known as Project Willow, aimed to chart a future for the site in low-carbon energy. But the report said this would require around £3.5 billion of private investment.

Petroineos has said the refinery is loss-making and has rejected claims from unions the site could easily transition into a hub for producing sustainable aviation fuel.

Iain Hardie, regional head of legal and external affairs for Petroineos, said: “Grangemouth refinery is no longer processing crude oil. Petroineos has invested £50 million in creating a modern import and distribution terminal capable of receiving finished fuels by sea for onward distribution to customers around the country.

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“From today, we will be importing all the products necessary to meet Scotland’s demand for transport fuels.”

He continued: “We would like to pay tribute to the workforce here. Our colleagues have shown incredible commitment, dignity and resilience during months of uncertainty regarding the future of this facility, through the consultation period, phased shutdown and the start of refinery decommissioning.

READ MORE: How Grangemouth oil refinery's future can still be saved if we don't give up the fight

“It has been a challenging period, but their professionalism has ensured security of fuel supply to our customers across Scotland and beyond.”

Other parts of the wider Grangemouth complex, including the Forties pipeline system which links to the North Sea, will not be affected by the site’s closure.

Responding to the announcement, First Minister John Swinney said: “The end of refining at Grangemouth is a very sad day for Scotland. This news is very damaging for workers and everyone in the area.

“The Scottish Government will work to secure a future for the Grangemouth community and agreement to the Acorn Carbon Capture project is essential.”

MPs discussed the closure in the Commons on Tuesday.

Brian Leishman, the Labour MP for Alloa and Grangemouth, described Scotland as the “victim of industrial vandalism”.

Grangemouth MP Brian Leishman speaking at last summer's rally to save the refinery. Pic: Michael Gillen

He told the Commons: “Today is the end of over a century of refining at Grangemouth.

“Scotland once again is a victim of industrial vandalism and devastation, and I don’t want anyone in this chamber to dare mention a ‘just transition’, because we all know that the Conservatives when in power and the SNP currently in Holyrood did nothing to avert this catastrophic decision happening.

“I put it to the Secretary of State [Ed Miliband], the Labour leadership in the general election campaign, said they would step in and save the jobs at the refinery. What has changed? And why have we not done the sensible thing for Scotland’s energy security?”

Mr Leishman shook his head and shouted “not enough” as Energy Secretary Mr Miliband replied: “Grangemouth has a really important role in Scotland.

“What I would say to him and to others is this Government, as soon as it saw the situation it inherited, put money in to help the workers and has made this huge investment commitment of £200 million working hand-in-glove with the Scottish Government so we absolutely build a future in Grangemouth.”

Liberal Democrat MP Christine Jardine referred to remarks from Ineos chairman Sir Jim Ratcliffe, who said his company may have to pause investment due to high energy prices and carbon taxes.

Ms Jardine said: “Today there are warnings from Grangemouth that they may have to pause important projects to switch to greener and more sustainable energies because of what they describe as the soaring energy bills and the pressures of income tax.”

Sharon Graham, the general secretary of the trade union Unite, said the UK and Scottish governments had “utterly failed” to protect jobs at the refinery.

“Highly skilled, well-paid workers, are being thrown on an industrial scrapheap,” she said. “Starmer and Swinney have allowed one of the worst self-inflicted blows to happen in generations, and they will face the electoral consequences.”

“The job cuts are entirely unnecessary. There are projects like SAF [sustainable aviation fuel] production, which can be accelerated to protect jobs. and those opportunities must not be lost.

“It would pave the way for Grangemouth to become a world leader in green aviation.

“For all the talk, nothing has been done and both governments have effectively allowed China to shut down Scotland’s capacity to refine fuel, as it hopes to use Grangemouth as an import hub. Workers will not forget or forgive.”

STUC general secretary Roz Foyer said the closure was an “inexcusable and unforgivable failure” of both governments, during her speech at the body’s congress in Dundee on Tuesday.

“We have seen from this very stage today and yesterday workers were served warm words and platitudes from our politicians, wringing their hands whilst on the ground, workers are receiving redundancy notices,” she said.

“It is high time both they and the billionaire-class owners of national industries were properly held to account if we ever hope to make a just transition a reality.”

Local Scottish Green MSP Gillian Mackay said the announcement would be “devastating” for the area, adding: “It is a further blow to the community. It is deeply disappointing that Labour have not stepped in to protect workers or to future-proof jobs in the same way that they have with steelworks down south.

“Grangemouth is my home, and it has been frustrating to see promises being made and dropped as easily as Petroineos’ detached billionaire has now dropped the workforce. I am concerned about what this will look like in the short term for the town.

“Warm words will not pay the bills. Grangemouth holds a lot of potential, as do the workers who offer the skills we need for transitioning away from fossil fuels.”