Up to 200 jobs likely to be axed at Grangemouth refinery site as pandemic bites

Nearly 200 jobs are likely to go at the Grangemouth refinery site, in a major blow to Scotland’s industrial sector.

Jobs are to be cut at the Grangemouth plant
Jobs are to be cut at the Grangemouth plant

Petrochemical group Petroineos said it would kick off talks with employees from Monday over its proposals to scale down its refining operation at Grangemouth.

It noted that the proposed changes reflected a global decline in demand for fuels, exacerbated by the Covid pandemic.

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Under the plans, the firm would mothball two units at the site. These units have been closed throughout the coronavirus crisis due to “significantly reduced local and international demand for fuels”.

There are currently 637 Petroineos employees at Grangemouth, near Falkirk, and the firm is looking to retain 450 “high quality” jobs as a result of the shake-up.

Franck Demay, chief executive of Petroineos Refining, said: “As a national critical infrastructure it is vital we retain a productive capacity of fuels in Scotland.

“We firmly believe that only by taking action now will we preserve one of Scotland’s last large manufacturing sites and a significant contributor to the Scottish economy.”

Petroineos is a partnership between the Ineos Group and Chinese firm PetroChina. Earlier this year, it was reported that the firm was pursuing a loan package from both the UK and Scottish governments for millions of pounds amid the fall in demand.

The company today said: “The global refining industry is facing huge challenges as increasing electrification of the transport fleet and more fuel-efficient vehicles leads to reduced demand for fuel, a trend that has been accelerated this year by the Covid-19 pandemic.

“To address this, Petroineos proposes a realignment of its refining capacity at Grangemouth in line with current and anticipated future demand for fuel in Scotland, the north of England and Northern Ireland.

“The proposal to keep the two production plants, Crude Distillation Unit 1 and the Fluidised Catalytic Cracker Unit (FCCU) in a mothballed state will reduce future incurred costs associated with operating these two older plants.”

Angus MacDonald MSP said: “Businesses across the globe are experiencing significant difficulties due to the impact of Covid-19, and it is never easy to hear that there could be job losses – but today’s announcement that Petroineos are about to consult on up to 200 redundancies is particularly disheartening, and my thoughts are with the workers at the plant in Grangemouth who could be affected by these changes.

“I am seeking urgent information from the Scottish Government, and know that they have been in touch with the company to offer assistance in the form of PACE, and I understand that Falkirk Council have offered to meet with Petroineos to see how they can be supported as they move through this particularly challenging period – and I have also offered my input into those discussions.

“As the world moves through the pandemic, and the call for more sustainable energy becomes increasingly loud, there must be consideration of a just transition while ensuring that employment and jobs are maintained and sustained as we go forward on a greener and cleaner pathway. I will do all I can in my position to ensure that this pathway remains clear, and that new opportunities for employment are explored and found in the very near future.”

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