Petroineos blamed by SNP minister over 'earlier' Grangemouth closure decision as 400 jobs to be axed

Petroineos, a collaboration of Ineos and Chinese state-owned PetroChina, confirmed it would close the Grangemouth oil refinery by the summer of next year, with the direct loss of 400 jobs over the next two years.

READ MORE: SNP told to rethink nuclear opposition after Grangemouth energy jobs losses

But acting net zero and energy secretary Gillian Martin has suggested there has been frustration from politicians the closure will take place before plans for the future of the key industrial hub, through Project Willow, have been drawn up.

Plans under consideration for the future of Grangemouth include a low carbon hydrogen hub, production of clean eFuels and sustainable aviation fuels.

The SNP minister has insisted the Grangemouth industrial hub could be transformed into “an epicentre for eFuels production”.

But Petroineos has pulled the plug on the refinery before plans, and crucially, job opportunities have been lined up for the highly-skilled energy workers.

Speaking on the BBC’s Sunday Show, Ms Martin said: “I would like to see a future for the refinery that’s maybe not in its current state of refining of hydrocarbons, but as an eFuels base. The demand for hydrocarbon-based fuels is going down, which is one of the reasons why Petroineos has made this decision.

“The demand for sustainable aviation fuels and eFuels is only going to go up. The skills of those workers are going to be really important in actually delivering on that.”

Ms Martin added: “It has always been our position with Petroineos that we want the refinery to continue for as long as possible to allow Project Willow to finish and then to be able to set out our stall. The closure has come a little bit earlier than we all thought.”

Petroineos chief executive officer Frank Demay has said “demand for key fuels we produce at Grangemouth has already started to decline”, while suggesting the costs to maintain the ageing refinery meant closing the plant was inevitable.

Speculation has also mounted about a potential takeover deal for the refinery after local SNP MSP Michelle Thomson said she had held talks with a potential buyer.

But SNP ministers and crucially Petroineos do not have any knowledge of the bid. Petroineos, which has plans to turn the refinery into an import terminal, would need to agree to any sale, which is unlikely to happen.

Asked about the potential sale, Ms Martin said: “I think one of the things that I’m slightly wary of is the fact that Petroineos actually said around late November last year that their intention was to close the refinery in its current form and turn it into an import terminal.

“I would have imagined that if anyone was interested in taking over the refinery, that would have been the key point to get in touch. But obviously I don’t know the background of these people.”

Ms Martin added: “I would like to know who they are, I would like to know what their background is. And I think Petroineos obviously would like to have an understanding of who this person is as well.”