Page last updated at 17:15 GMT, Friday, 25 April 2008 18:15 UK

Strike refinery shutdown complete

Grangemouth
The Grangemouth oil refinery has been closed down

The shutdown of the Ineos oil refinery at Grangemouth in central Scotland has been completed, the company has said.

The 1,700-acre plant is being closed in preparation for a two-day strike by staff over pension changes, which is due to start on Sunday.

Oil giant BP has said that if the strike action went ahead, it would have to close the Forties oil pipeline.

The pipeline links North Sea oil production with Grangemouth, delivering a third of the UK's daily oil output.

Scotland's First Minister Alex Salmond said he was "certain" the strike would go ahead but insisted "fuel is flowing" across the country.

Mr Salmond acknowledged there were shortages at various forecourts - particularly of diesel - and repeated calls warning against panic buying.

The process to shut the refinery, which is Scotland's main fuel supplier, began on Monday.

It is the first time production at the facility, which processes 210,000 barrels of oil a day, has been completely shut down.

We are fighting for the future of Grangemouth
Richard Longden
Ineos

Ineos said it could take up to three weeks for the plant to get back to 100% production capacity following the shutdown.

The Forties pipeline, which comes ashore at Cruden Bay in Aberdeenshire and ends at the Kinneil terminal, near Grangemouth, is reliant on the Ineos refinery for steam and electricity to function.

Industry groups have warned that the closure of the pipeline could cost the UK economy 50m a day and cause the suspension of production across 65 oil fields in the North Sea.

Ineos spokesman Richard Longden claimed that despite repeated requests, Unite had refused to maintain power and steam at the refinery when the strike begins so that the pipeline can remain operational.

He said: "We have put that to the union on a number of occasions and they have refused. We are hoping that they will come back at some point today or tomorrow and say to us that we can keep that steam operating."

map

Ineos took over Grangemouth refinery in 2005 when it bought BP subsidiary Innovene.

Ineos general manager at Grangemouth, Gordon Grant, said the current pension scheme was not sustainable.

He said:"This pension was inherited from BP. BP are an upstream oil company. We are a petrochemical company and we have to have a pension that is competitive in the market place that we operate in.

"Petrochemicals is a difficult market place and we have to be competitive in everything that we do."

Mr Grant said the company was doing everything it could to avoid a strike.

The Unite union, which represents 1,200 workers at the refinery, accused Ineos of acting cynically.

National officer Phil McNulty said: "We believe that Ineos has acted cynically in its dealings with us and we are suspicious about its intentions even to try to avert a strike.

"Our members have acted in good faith throughout this dispute.

"We have talked to Ineos for eight months and only when the company breached the terms of the consultation by introducing changes to the pension scheme without agreement did we ballot out members."

Tony Woodley, joint chair of Unite, said that the strike was now "unstoppable".

However, he added: "After these two days there will be a pause for peace, a pause for reflection, and I sincerely hope that the chief executive of Ineos thinks long and hard about what we can do to resolve this problem."


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