Grangemouth Oil Refinery to Shut Down in 2025
Grangemouth Oil Refinery to Shut Down in 2025: Petroineos, the operator of Scotland’s only oil refinery in Grangemouth, has announced that the facility will close in 2025, resulting in
the loss of 400 jobs. According to Reuters, this decision marks a shift in the refinery’s future as it will be transformed into a fuels import terminal. Petroineos first signaled its intention to shut down the century-old plant last November, and production is expected to end in the second quarter of 2024, pending employee consultations.
The refinery’s closure has drawn criticism from trade unions and politicians alike.
UK Energy Secretary Ed Miliband expressed disappointment, stating it was
regrettable that Petroineos confirmed the closure despite prior objections.
The shift will reduce the refinery’s workforce from 475 to approximately 75 employees within two years as it transitions into an import and distribution center for finished fuels.
Petroineos, a joint venture between PetroChina International London (PCIL)
and INEOS Group, attributes the decision to economic challenges. Since 2011,
the company has invested $1.2 billion into Grangemouth but faced substantial losses
totaling more than $775 million during the same period. Petroineos said Grangemouth is struggling to compete with more efficient and modern refineries in regions like the Middle East, Asia, and Africa,
such as the newly opened Dangote Refinery. The company also cited the plant’s high
operating costs and daily losses of around $500,000, projecting a $200 million deficit for 2024.
the effort
Efforts to keep the plant open until a low-carbon alternative was found were backed by trade unions and local politicians. However, Petroineos’s plans prevailed, despite calls for a sustainable
future for the site. In response, the UK and Scottish governments have announced a joint initiative, including a financial package of £100 million ($130.43 million), to support the industrial future
of Grangemouth and aid displaced workers in finding alternative employment.
Additionally, this package will contribute to local energy projects. Unite, a trade union
representing the refinery’s workers, labeled the closure an act of “industrial vandalism,” emphasizing the refinery’s significance to the UK’s manufacturing sector and energy security.