Grangemouth transition planning should have started five years ago, MSPs told

Representatives of Petroineos, which owns the Scottish plant and has announced plans to close the refinery in the second quarter of next year, appeared before the Economy and Fair Work Committee on Wednesday.

Iain Hardie, the firm’s head of legal and external affairs, told MSPs the site lost on average £385,000 per day last week and expects a £150 million loss this year.

The closure decision – which was announced last year and confirmed in September – could risk up to 400 jobs at the site as it looks to change into an import terminal.

Mr Hardie said the company approached the Scottish and UK governments five years ago to discuss potential changes.

“We have launched Project Willow, a study which will look at low-carbon manufacturing options for the site,” he said.

“But let’s be clear, the purpose of that study is not and will not enable a smooth transition from a fossil fuel-based economy to a non-fossil fuel-based economy.

“If that was to have been put into effect, that piece of work would have had to happen five years ago.

“Let’s be very clear, we came to the Scottish and UK government five years ago with that proposition, but we didn’t move on.”

Under questioning from committee convener Colin Smyth, who pushed Mr Hardie on the just transition for workers on the site, he said: “We have very clearly articulated to the Government in Holyrood and Westminster for a number of years the challenges that our business was facing.

“Those challenges are driven in part by politics set by this Government around the ban on new build petrol and diesel cars post-2030, so in that context, I think it’s hardly surprising that there’d be an announcement, as a manufacturer of petrol and diesel fuel, that we would have to transition away from that at a point.”

Michelle Thomson, the local MSP for Grangemouth and the committee’s deputy convener, asked if Government investment in the site could allow for a pause to transition the workforce into other jobs.

“I think we’ve moved past that stage,” Mr Hardie said.

“If the Government wish to make an intervention, that intervention should have been made many, many months ago.”

The company, he said, cannot wait for “what ifs” from Government and has to make decisions based on current information.

“We’ve heard a number of times about politicians ‘leaving no stone unturned’ in order to continue the refinery operations, but that’s come to nought,” he said.

“If we were to wait for (Government help), we would have grown roots.”

In the wake of the announcement in September, Ms Thomson said she had been in talks with a potential buyer for the site.

Mr Hardie said there had been discussions with interested parties, but no “credible” offers.

Such talk, he told the committee, had caused issues with staff.

“The vacillations around whether or if there will be an investor, whether or if there will be a purchase, has caused significant disruption to our staff and we’re really, really, keen to manage that,” he added.