Grangemouth to stop fuel refining, become import hub

Grangemouth operator Petroineos has announced that fuel refinery operations at the site will cease in the Spring of 2025 and the plant will be transformed into a fuels import terminal.

Petroineos is a joint venture between Chinese state oil firm PetroChina and privately owned chemical producer Ineos.

As part of its plans communicated to staff, Petroineos said it is also evaluating a range of low-carbon opportunities for Grangemouth, including the feasibility of a bio-refinery facility at the complex.

The company said it is working closely on this project with a range of interested parties, including the Scottish and UK governments, and will provide more information in due course.

In a statement, Petroineos said: “Petroineos will soon start preparatory work to enable the future transformation of its Grangemouth refinery into a fuels import terminal.

“The timescale for any operational change has not yet been determined but the work will take around 18 months to complete and the refinery is therefore expected to continue operating until Spring 2025.

“Grangemouth is home to the only fuels refinery in Scotland, which has been a vital piece of national infrastructure for the past century but faces significant challenges due to global market pressures and the energy transition.

“This investment will provide greater operational flexibility and safeguard the site as a national fuel hub for decades to come.

“The preparatory work will make it possible to import petrol, diesel, aviation fuel and kerosene into Scotland from vessels arriving via the Firth of Forth.

“The company will also progress work to enable the conversion of its existing export terminal at Finnart on the Firth of Clyde – which is linked to Grangemouth by cross-country pipelines – into a diesel import facility.

“Once a decision is taken to commission the new infrastructure, Petroineos will have the means of importing finished fuels for onward distribution to customers around the country through its established supply networks.”

Petroineos Refining CEO Franck Demay said: “This does not change anything for our operation today, where it is business-as-usual at the Grangemouth refinery.

“We currently anticipate continuing refinery operations until Spring 2025.

“As the energy transition gathers pace, this is a necessary step in adapting our business to reflect the decline in demand for the type of fuels we produce.

“As a prudent operator, we must plan accordingly, but the precise timeline for implementing any change has yet to be determined.

“This is the start of a journey to transform our operation from one that manufactures fuel products, into a business that imports finished fuel products for onward distribution to customers.

“Throughout this process, our focus will remain on the safe production and reliable supply of high-quality fuels to our customers in Scotland, the north of England, and Northern Ireland.

“As we start to make this investment in preparing for a future transformation, we are equally committed to a regular programme of engagement with our colleagues about the changes we are making to our business.”

Derek Thomson, Unite union’s Scottish secretary, said: “Unite continues to engage with Petroineos, and we urge other stakeholders such as the Scottish and UK governments to do the same due to the implications that this proposal will have for the economies of the devolved and reserved administrations.

“Every option must be on the table in order to secure the hundreds of highly skilled jobs based at the Grangemouth complex for the long-term.”