Grangemouth Refinery (Support)

Topical Question Time – in the Scottish Parliament at 2:16 pm on 7 May 2024.

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Photo of Stephen Kerr Stephen Kerr Conservative 2:16, 7 May 2024

To ask the Scottish Government, in light of recently reported developments, what plans are being made to support the continued operation of the Grangemouth refinery. (S6T-01964)

Photo of Màiri McAllan Màiri McAllan Scottish National Party

The Scottish Government continues to engage extensively with the owners of the Grangemouth refinery and is committed to securing a long-term sustainable future for the industrial cluster. The future configuration of the Grangemouth refinery is a commercial matter for the owners. However, we have a track record of supporting businesses at Grangemouth as they progress their low-carbon projects, and we are committed to working collaboratively with Petroineos to accelerate its own projects at the site.

Photo of Stephen Kerr Stephen Kerr Conservative

I hope that the Cabinet secretary will join me in paying tribute to the positive campaign that has been run by Unite the union, which is aptly called keep Grangemouth working. As a Conservative, I have no hesitation in backing that campaign to keep Grangemouth working, because the campaign asks for three things—an extension of the lifetime of the refinery, investment in new technology and support for greener and cleaner energy projects.

From her engagement with Petroineos, can the cabinet secretary confirm Martin Williams’s front-page story in The Herald this morning that the hydrocracker has been restarted? What impact does the return to sustained profitability mean for extending the life of the refinery?

Photo of Màiri McAllan Màiri McAllan Scottish National Party

I am very pleased to join Stephen Kerr in recognising the work of Unite the union. By extension, I again put on record my thanks to the highly skilled workers at Grangemouth, who contribute so much to that asset of strategic importance to Scotland.

I am of course aware of today’s media coverage, which explores the issue of the hydrocracker at the Grangemouth refinery. That is purely an operational matter for the company, and it is commercially sensitive. It is not appropriate for me to speculate or theorise on what is, in essence, media speculation at this point, but I can assure Stephen Kerr and members that ministers and officials engage regularly with all those with an interest in the cluster, including with the business, to understand the impact of current operations. We are interested in operations today and how that progresses into the future.

Photo of Stephen Kerr Stephen Kerr Conservative

I thank the Minister for her response, but I hope that she would agree that it is a matter of interest for her and her team to find out whether the hydrocracker has been restarted. We have it from multiple sources that it has been, and that is a significant development.

I cannot help but think that the window of opportunity that the restarting of the hydrocracker brings is not unrelated to the end of the Bute house agreement. I echo what Derek Thomson of Unite has said in the light of the return to healthy profits for Petroineos at Grangemouth. He said:

“The only sensible commercial decision to be made is to maintain the refinery’s operations and in doing so retain 500 highly-skilled jobs.”

I say, “Hear, hear”, to that.

Investing in cleaner and greener energy projects at Grangemouth is a major strategic issue for the whole of Britain. Both Governments must work together with local interests to secure the future of the site and the local economy. What discussions has the Cabinet secretary had with UK ministers, and what have they agreed? In addition to the local council, Forth Valley College and Petroineos, which other local businesses have been recruited to the Grangemouth future industry board?

Photo of Màiri McAllan Màiri McAllan Scottish National Party

I will be glad to share with Stephen Kerr a copy of the cast list for the Grangemouth future industry board. It is quite extensive, so I will do that in writing.

Given the importance that Stephen Kerr places on the matter—as I do—I encourage him not to indulge in theories about political configuration on the one hand and, on the other, what are, in essence, commercial matters for Petroineos to consider. I restate the fact that it is not appropriate for me to comment on media speculation, but I reinforce the point that ministers and officials are very closely engaged in the development of these matters.

I close by highlighting that, given the strategic importance of Grangemouth, our objective is to maximise transition opportunities and minimise any gap between those emerging and transition happening, all with a view to securing as many jobs as possible.

Photo of Michelle Thomson Michelle Thomson Scottish National Party

We all agree about the need to secure the refinery and jobs in this important industrial cluster in my Constituency. However, we also agree on the need for that to be done sustainably, so, to that end, will the Cabinet secretary update Parliament on the calls for the United Kingdom Government to remove the regulatory barriers affecting sustainable aviation fuels and thus to allow the possibility that the site will have a future as a biorefinery?

Photo of Màiri McAllan Màiri McAllan Scottish National Party

Michelle Thomson is absolutely right to highlight biorefining as a potential transition opportunity for the cluster. Ministers have made several representations to the UK Government and have asked for engagement on issues regarding sustainable aviation fuel. Initial indications suggested that the UK’s post-Brexit SAF mandate would inhibit the use of hydrotreated esters and fatty acids and therefore the development of SAF, but more recent developments appear to present a more positive picture. We will continue pressing that issue. I am in on-going dialogue about the matter with UK ministers in both the Scotland Office and the Department for Energy Security and Net Zero and I will be glad to keep Michelle Thomson up to date about that, given my understanding of her concern about the issue.

Photo of Sarah Boyack Sarah Boyack Labour

Will the Cabinet secretary confirm that the just transition plan for Grangemouth will be published this month? Does she acknowledge that staff working at Grangemouth need assurance that their skills, knowledge and experience will be key to a just transition to the cleaner, greener energy projects that can make Grangemouth and Scotland successful leaders in renewable energy and to meeting the aspirations that Unite says are in critical need of our support?

Photo of Màiri McAllan Màiri McAllan Scottish National Party

I agree with a great deal of what Sarah Boyack says. Our just transition plan for Grangemouth industrial cluster will be a truly first-of-its-kind vision for the site and will outline the long-term operations that we hope to see taking place by 2045. Beyond that vision, the plan will also set out and chart the series of actions required to secure that vision, focusing on securing long-term investment, developing technical and commercially viable solutions for manufacturing, and fostering the correct policy environment for all that. Work to finalise the just transition plan is under way and I expect it to be published very soon.

Photo of Ash Denham Ash Denham Scottish National Party

Having raised the need for urgent action, I welcome the news that Petroineos has invested in and restarted the hydrocracker and that the site is turning a profit. The save Grangemouth campaign, which is headed by my Westminster colleague Kenny MacAskill, aligns itself with the results of a recent survey by Unite the union, which strongly indicates that there has been a collective failure by both Governments to support Grangemouth. What substantive commitment will the Government now make to ensure a long-term sustainable future for this core asset for Scotland’s energy industry, so that there is no cliff edge for both workers and Scotland’s energy security?

Photo of Màiri McAllan Màiri McAllan Scottish National Party

The Government is absolutely clear about the strategic importance of the Grangemouth complex. That is why future proofing the complex is a priority for us. It is important to our economy and our energy mix and is vital to the workforce in Grangemouth and the surrounding communities. That is why, although decisions regarding the companies on the site are for the commercial entities that are in control there, we are working determinedly with all interested parties on a future plan. We are meeting all who have a stake and are investing, including in plans for future low-carbon opportunities. I end by restating our ambition to maximise transition opportunities, minimise gaps and secure as many jobs as possible.

Photo of Daniel Johnson Daniel Johnson Labour

In her answers so far, the Cabinet secretary has stopped short of committing to publishing the just transition plan. Can she confirm that it will be published by the end of the month? Given that the Scottish Government’s web page for the Grangemouth future industry board states that it is updating its workstream priorities for 2023, and that we are five months into 2024, is she comfortable with the pace and volume and actions that have been taken to date?

Photo of Alison Johnstone Alison Johnstone Green

Please answer in relation to the substantive question, Cabinet secretary.

Photo of Màiri McAllan Màiri McAllan Scottish National Party

As I said in my response to Sarah Boyack, the work on the vision and actions that will be set out in the just transition plan for Grangemouth is nearing completion. I expect the plan to be published very soon indeed.

Photo of Alison Johnstone Alison Johnstone Green

That concludes topical questions.

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