John Swinney 'actively pursuing option' to keep Grangemouth refinery open

Mr Swinney has also suggested that the decision to close the Grangemouth refinery next year could potentially scupper plans for a just transition for workers and a long-delayed carbon capture and storage project which could see Grangemouth connected with the North East through existing pipe infrastructure.

Petroineos, a joint venture between Ineos and Chinese state-owned PetraChina, confirmed the refinery will close in the second quarter of 2025 - with the loss of 400 direct jobs and up to 3,000 through supply chains.

Last week, the company pointed the finger firmly at the UK and Scottish governments, claiming concerns about the financial viability of the site had been made three years ago but had fallen on deaf ears.

Read more: Why Petroineos is blaming SNP and Labour's policies for 400 Grangemouth job losses

Petroineos’ head of legal and external affairs for Scotland, Iain Hardie, told MSPs that his company has “very clearly articulated to the government in Holyrood and Westminster, for a number of years, the challenges that our business was facing”.

He added that the issues have been “driven, in part, by policies set by this government around the ban on new-built petrol and diesel cars post-2030”, insisting it was “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”.

Earlier this week, Unite the union questioned financial statements produced by Petroineos which has set out the refining operation was losing up to £385,000 each day earlier this month and is on track for a £150m loss this year.

Mr Swinney has pressed for a good deal for Grangemouth since Sir Keir Starmer came to office in July - bringing it up at their first meeting at Bute House.

In September, Unite’s regional organiser for Scotland, Derek Thomson, told The Scotsman that the Scottish and UK government could take “a transitional stake in the refinery”, which would involve ministers stepping in for a period of time to extend the life of the facility.

The idea has been backed by Labour MP for Alloa and Grangemouth, Brian Leishman. Another option would be for the UK government to potentially nationalise the facility - but Labour has indicated that is a non-starter.

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

Speaking at First Minister’s Questions, Mr Swinney stressed that the decision to close the Grangemouth plant has been made too soon to enable a just transition for workers.

He said: “The closure announcement for the refinery is a premature decision and it accelerates a change that does not need to take place at this stage but could be managed over a number of further years to enable us to put more alternatives in place.”

Mr Swinney was pressed by Alba MSP Ash Regan over whether “Scotland will become the only top 25 oil producing nation with no refining capacity”, amid concerns “key national infrastructure is lost forever”.

But in response the First Minister confirmed he was “actively pursuing an option to maintain the refining capacity at Grangemouth”.

He said: “I think economic damage will be done if there is no intervention to prolong the refinery life-cycle at Grangemouth.

“If we do that, we have the opportunity to secure carbon capture and storage, we have the opportunity to take forward the other projects through the project willow exercise. That will provide us with a secure future for the Grangemouth site.

“Let there be no doubt about it - the Scottish Government is actively pursuing these opportunities to protect the workers at Grangemouth.”

SNP MSP Michelle Thomson, who represents Grangemouth, had asked the First Minister if he would back a “pause” on the decision to close the refinery.

In response, he said: “Michelle Thomson asked if I would support a pause in any plans to close the refinery, and I do.

"We will continue to work with the UK government, and with the company, to try to avoid economic disruption and damage to the Grangemouth area, and especially to the livelihoods of the workers involved."