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This might be dressed as something else but its a lack of Northsea GAS:-
Grangemouth owners Ineos to close petrochemical site
Part of the giant Grangemouth site is to close following a bitter row between Ineos and unions over pay and conditions, while the fate of the adjacent oil refinery hangs in the balance
The company had been locked in a bitter dispute with union Unite over plans to change staff working conditions to make the business more competitive, including cutting retirement benefits to address a £200m pension deficit. Photo: GETTY IMAGES
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By Alistair Osborne, Business Editor
10:26AM BST 23 Oct 2013
155 Comments
Ineos has told workers it will close its Grangemouth petro-chemicals plant after they refused to sign up to a cost-cutting plan deemed vital for its survival.
Callum MacLean, Grangemouth Petrochemicals chairman, told a meeting of about 700 workers at the Scottish plant that the Swiss-based company could no longer support a business that it claims is losing £10m a month. Ineos said it will appoint liquidators to the business within a week.
The decision is certain to provoke a furious backlash from the unions and the Scottish government, which in recent days have been lobbying Ineos to come back to the negotiating table to save the plant.
The privately-owned Ineos, which is majority controlled by founder and chairman Jim Ratcliffe, took the decision last night after a meeting of its shareholders – just a handful of individuals.
While the closure verdict initially only affects the chemicals plant, the decision puts the jobs of all 1,350 workers at Grangemouth at risk.
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Mr Ratcliffe has warned that the closure of the petrochemical unit could be followed by a shutdown of the adjacent refinery, operated in partnership with Petro-China, which provides 80pc of Scotland’s fuel.
Calum MacLean, Grangemouth Petrochemicals chairman, said: “This is a hugely sad day for everyone at Grangemouth. We have tried our hardest to convince employees of the need for change but unsuccessfully. There was only ever going to be one outcome to this story if nothing changed and we continued to lose money”.
Ineos maintains that the plant is losing £150m a year and needs £300m of investment in new terminal facilities to ship in cheap ethane from the US to replace declining North Sea feedstocks.
It wanted a deal with Unite to change staff working conditions to make the business more competitive, including closing its final salary retirement scheme to address a £200m pension deficit.
It had set a deadline of 6pm on Monday for workers to sign up to the “survival plan”, which include a £15,000 sweetner and a no-strike pledge, or see the site closed down.
In a statement, Ineos said this morning: “Following the breakdown of the ACAS talks last week and Unite’s refusal to provide a no strike guarantee, the company decided to approach the employees direct.
“Employees were asked to support the changes necessary to save the business. Management held direct meetings with all employees to explain the very serious nature of the problem.
“The company made it clear that rejection of change would result in closure. Regrettably, the union advised union members to reject any form of change.
“The outcome of the employee vote on the company’s Survival Plan was a 50/50 split. Within this, almost all of the administrative staff voted for the company’s plan but a large majority of shop floor employees voted to reject it.”
It added that the shareholders met on Tuesday “to consider the future of the business following the result of the employee vote. Sadly, the shareholders reached the conclusion that they could not see a future for Grangemouth without change and therefore could no longer continue to fund the business.”
The company added: “As a result of this decision, the directors of the petrochemicals business have had no option but to engage the services of a liquidator. It is anticipated that a liquidation process will commence in a week.”
The firm said a decision on whether to restart production at the oil refinery will depend on the removal of the threat of further industrial action.
Mr MacLean added: “We still struggle to comprehend what has happened here. The employees were offered a chance to secure substantial new investment in the company, preserve their jobs and keep their salaries. Sadly this will no longer be the case.”
Energy Secretary Edward Davey urged the two sides to re-start talks and said the Government would help with that. “I am saddened to hear of Ineos's plans to place petrochemicals business into administration, particularly because of the impact it will have on the workforce and local community," he said.
“While respecting Ineos's right to make this decision, it is regrettable that both parties have not managed to negotiate a fair and equitable settlement that delivers a viable business model for the plant.
“Even at this late stage, I urge Ineos to continue dialogue with the workforce, and Government will offer help and support with this."
The closure of the plant is also likely to prove a test-case for the clout of the Scottish Government. Ministers and Ineos clashed on Tuesday over the financial health of the site and whether a new buyer could take over the business.
Gerry Hepburn, chief financial officer of Ineos Chemicals Grangemouth, took issue with suggestions from SNP finance minister John Swinney that it was “completely inappropriate” to call the plant “distressed” and that alternative buyers could be found.
Mr Swinney insisted Grangemouth was a “strong industrial plant”, adding that the Scottish government was “looking at alternative options and there will be other players around the globe who will be interested”. He ruled out nationalisation.
Mr Hepburn said the Scottish government had not informed Ineos that it had been sounding out buyers. “There’s not anyone obvious I can think of,” he said. “It’s an interesting suggestion but we haven’t really formed a view on whether that’s likely to come to anything. If they want to talk to us they can.”
He stressed, however: “The issue is we are making a loss. It’s difficult to see, when you have a business making losses and requiring a high level of investment, who would want to buy it.”
Grangemouth owners Ineos to close petrochemical site
Part of the giant Grangemouth site is to close following a bitter row between Ineos and unions over pay and conditions, while the fate of the adjacent oil refinery hangs in the balance
The company had been locked in a bitter dispute with union Unite over plans to change staff working conditions to make the business more competitive, including cutting retirement benefits to address a £200m pension deficit. Photo: GETTY IMAGESDo you know your credit score? Get your Experian Credit Report here.
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By Alistair Osborne, Business Editor
10:26AM BST 23 Oct 2013
155 Comments Ineos has told workers it will close its Grangemouth petro-chemicals plant after they refused to sign up to a cost-cutting plan deemed vital for its survival.
Callum MacLean, Grangemouth Petrochemicals chairman, told a meeting of about 700 workers at the Scottish plant that the Swiss-based company could no longer support a business that it claims is losing £10m a month. Ineos said it will appoint liquidators to the business within a week.
The decision is certain to provoke a furious backlash from the unions and the Scottish government, which in recent days have been lobbying Ineos to come back to the negotiating table to save the plant.
The privately-owned Ineos, which is majority controlled by founder and chairman Jim Ratcliffe, took the decision last night after a meeting of its shareholders – just a handful of individuals.
While the closure verdict initially only affects the chemicals plant, the decision puts the jobs of all 1,350 workers at Grangemouth at risk.
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Mr Ratcliffe has warned that the closure of the petrochemical unit could be followed by a shutdown of the adjacent refinery, operated in partnership with Petro-China, which provides 80pc of Scotland’s fuel.
Calum MacLean, Grangemouth Petrochemicals chairman, said: “This is a hugely sad day for everyone at Grangemouth. We have tried our hardest to convince employees of the need for change but unsuccessfully. There was only ever going to be one outcome to this story if nothing changed and we continued to lose money”.
Ineos maintains that the plant is losing £150m a year and needs £300m of investment in new terminal facilities to ship in cheap ethane from the US to replace declining North Sea feedstocks.
It wanted a deal with Unite to change staff working conditions to make the business more competitive, including closing its final salary retirement scheme to address a £200m pension deficit.
It had set a deadline of 6pm on Monday for workers to sign up to the “survival plan”, which include a £15,000 sweetner and a no-strike pledge, or see the site closed down.
In a statement, Ineos said this morning: “Following the breakdown of the ACAS talks last week and Unite’s refusal to provide a no strike guarantee, the company decided to approach the employees direct.
“Employees were asked to support the changes necessary to save the business. Management held direct meetings with all employees to explain the very serious nature of the problem.
“The company made it clear that rejection of change would result in closure. Regrettably, the union advised union members to reject any form of change.
“The outcome of the employee vote on the company’s Survival Plan was a 50/50 split. Within this, almost all of the administrative staff voted for the company’s plan but a large majority of shop floor employees voted to reject it.”
It added that the shareholders met on Tuesday “to consider the future of the business following the result of the employee vote. Sadly, the shareholders reached the conclusion that they could not see a future for Grangemouth without change and therefore could no longer continue to fund the business.”
The company added: “As a result of this decision, the directors of the petrochemicals business have had no option but to engage the services of a liquidator. It is anticipated that a liquidation process will commence in a week.”
The firm said a decision on whether to restart production at the oil refinery will depend on the removal of the threat of further industrial action.
Mr MacLean added: “We still struggle to comprehend what has happened here. The employees were offered a chance to secure substantial new investment in the company, preserve their jobs and keep their salaries. Sadly this will no longer be the case.”
Energy Secretary Edward Davey urged the two sides to re-start talks and said the Government would help with that. “I am saddened to hear of Ineos's plans to place petrochemicals business into administration, particularly because of the impact it will have on the workforce and local community," he said.
“While respecting Ineos's right to make this decision, it is regrettable that both parties have not managed to negotiate a fair and equitable settlement that delivers a viable business model for the plant.
“Even at this late stage, I urge Ineos to continue dialogue with the workforce, and Government will offer help and support with this."
The closure of the plant is also likely to prove a test-case for the clout of the Scottish Government. Ministers and Ineos clashed on Tuesday over the financial health of the site and whether a new buyer could take over the business.
Gerry Hepburn, chief financial officer of Ineos Chemicals Grangemouth, took issue with suggestions from SNP finance minister John Swinney that it was “completely inappropriate” to call the plant “distressed” and that alternative buyers could be found.
Mr Swinney insisted Grangemouth was a “strong industrial plant”, adding that the Scottish government was “looking at alternative options and there will be other players around the globe who will be interested”. He ruled out nationalisation.
Mr Hepburn said the Scottish government had not informed Ineos that it had been sounding out buyers. “There’s not anyone obvious I can think of,” he said. “It’s an interesting suggestion but we haven’t really formed a view on whether that’s likely to come to anything. If they want to talk to us they can.”
He stressed, however: “The issue is we are making a loss. It’s difficult to see, when you have a business making losses and requiring a high level of investment, who would want to buy it.”
The brutal fact is that Britain has no place in today's world operating old world businesses that turn ethane extracted from gas into bulk industrial materials such as poly-ethylene and poly-propylene. Photo: JEFF J MITCHELL/GETTY IMAGES
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