October 22, 2013 10:41 pm

Scotland seeks buyers for Grangemouth

The Grangemouth refinery©Getty

The Grangemouth refinery

Scotland’s government has launched a search for potential buyers of the Grangemouth refinery, ramping up pressure on its owner to bring the nation’s most important industrial site back on line.

UK chemicals group Ineos has said it will announce its plans for the site to Grangemouth’s more than 1,300 workers on Wednesday, amid a bitter industrial dispute that has shuttered the complex since last week.

John Swinney, Scotland’s finance secretary, on Tuesday urged Ineos to quickly restart the plant. He dismissed the company’s claim that Grangemouth was “financially distressed” and revealed that officials were seeking other potential owners.

“There certainly will be other players around the globe interested in this particular plant,” Mr Swinney said.

Fears have grown in Scotland about the survival of the Grangemouth refinery, which Ineos owns jointly with PetroChina, and the petrochemicals plant.

Ineos has kept the complex shut down while it pushes workers to accept changes to their pay, pensions and union representation, which it says are essential to a “survival plan” for the complex.

But the Unite union said more than half Grangemouth workers had rejected the demands by a Monday deadline.

The union welcomed government efforts to find another company to take on the site, saying it needed a “responsible owner”.

However, one industry analyst said the petrochemicals plant was not internationally competitive and was "very unlikely" to attract any buyers.

The plant suffered a blow this month with news that a key customer, an Ineos facility at Saltend in Hull, was closing down. Ineos said at the time that low-cost imports into Europe had made the Saltend closure inevitable.

While the refinery has been seen as in better commercial shape, it is part of a sector suffering a long period of distress across the UK and Europe that has led to plant closures and corporate failures.

Ineos shut down Grangemouth last week, despite Unite’s decision to cancel a strike.

The company said it would not be safe to restart the complex without a union promise not to take more industrial action at least until the end of the year.

Unite said it was willing to give such an assurance but only if Ineos agreed to return to talks and to not to make workers redundant or take other action against staff in the meantime.

Mr Swinney said Ineos should take the union commitment “at face value” and restart operations. "The danger of the situation . . . is that we are heading for a stalemate,” he said. 

Copyright The Financial Times Limited 2015. You may share using our article tools.
Please don't cut articles from FT.com and redistribute by email or post to the web.


Sign up for email briefings to stay up to date on topics you are interested in