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Official Report: search what was said in Parliament

The Official Report is a written record of public meetings of the Parliament and committees.  

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Dates of parliamentary sessions
  1. Session 1: 12 May 1999 to 31 March 2003
  2. Session 2: 7 May 2003 to 2 April 2007
  3. Session 3: 9 May 2007 to 22 March 2011
  4. Session 4: 11 May 2011 to 23 March 2016
  5. Session 5: 12 May 2016 to 4 May 2021
  6. Current session: 13 May 2021 to 18 March 2026
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Displaying 1194 contributions

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Economy and Fair Work Committee

Petroineos Grangemouth

Meeting date: 13 December 2023

Neil Gray

That is fine.

Economy and Fair Work Committee

Petroineos Grangemouth

Meeting date: 13 December 2023

Neil Gray

I do not want to set up unrealistic expectations. Previous interventions to extend the capacity of the refinery were made when the international perspective and domestic demand were different. Alongside my colleagues in the UK Government, I want to explore every single possible opportunity to extend the life of the refinery. I think that Mr Kerr would expect that of both parties. However, I do not want to make false promises about what might be possible; I just want to demonstrate to Mr Kerr’s regional constituents, and to others more widely, that we are doing everything possible.

Economy and Fair Work Committee

Petroineos Grangemouth

Meeting date: 13 December 2023

Neil Gray

I have not disputed that. It is the timing that is still uncertain.

Economy and Fair Work Committee

Petroineos Grangemouth

Meeting date: 13 December 2023

Neil Gray

They meet on a regular basis, at both ministerial and official level. I am not sure of the date of the last meeting at official level.

Economy and Fair Work Committee

Petroineos Grangemouth

Meeting date: 13 December 2023

Neil Gray

I absolutely agree that we are trying to avoid how deindustrialisation has happened to communities in the past—communities that you represent, convener, and communities that I represent in Airdrie and Shotts. We are absolutely looking to avoid that.

The work that we are doing on our just transition plan for Grangemouth is continuing. I hope that we now have a date set for a ministerial element to the Grangemouth future industry board and that UK ministers will be along to that as well, so that we can discuss the impact of this on what we are trying to achieve for the Grangemouth site.

Colleagues have already articulated some of the potential options for future investment and industrial activity at the site. The jobs aspect is still to be finalised. We are still to understand the full detail of what refinery losses can be made up for by the import terminal. We are looking to push as hard as possible to ensure that, whenever a decision is taken, we protect as many jobs as possible, for the reasons that you have articulated.

More widely, we are looking to ensure that we see as many opportunities as possible to retain highly skilled workers from the traditional oil and gas sectors in the green industrial revolution that is coming, and to ensure that we can see a line of sight for workers who are looking to transition to be able to do so and remain here in Scotland.

Economy and Fair Work Committee

Petroineos Grangemouth

Meeting date: 13 December 2023

Neil Gray

There are a couple of elements in there. First, on the jobs and the assumption around potential losses, I have had—as I said in my introductory comments—very good and constructive meetings with Unite the Union and the STUC on that. They are working closely with the management and the joint venture to ensure that the workforce is given as much protection as possible, and that as much of the workforce as possible is retained in order to ensure that the refinery is operational for as long as that decision is alive.

With regard to the work in the supply chain, that features, as I said, in the work of the Grangemouth future industry board and the work that we are doing around the just transition plan. However, I note that certain types of supply chain operations such as the logistics element will still be there. Where there is an import terminal, there will still be a need for logistics moving from the site to the forecourts, so supply chain elements will still be retained as part of that. Nevertheless, we are looking to try to ensure that we assess the situation as acutely as possible, working with the joint venture to understand to a greater extent—as Ms Chapman challenged us to do—what the potential impact on the supply chain could be.

Economy and Fair Work Committee

Petroineos Grangemouth

Meeting date: 13 December 2023

Neil Gray

That is central to the work of the Grangemouth future industry board, and it will be central to the just transition plan that is published. We cannot have a just transition without having a just transition for the workforce, so of course that is central to the work that we are doing.

Economy and Fair Work Committee

Petroineos Grangemouth

Meeting date: 13 December 2023

Neil Gray

Those are the exact questions that I asked of the site management when I met them previously and of the joint venture shareholders when I met them yesterday. The discussions and work are on-going around that.

I wish to underline that this is an incredibly challenging situation. I think the team said that they are in a stable financial situation at the moment, but they have not been in the past, and the projections for the margins for the site show that a substantial subsidy and investment have come from the joint venture in order to retain the site. I do not wish to set unrealistic expectations about what might be possible or what might be considered by the joint venture to be necessary to see the refinery go beyond 2025. However, as Mr Smyth would expect, those are exactly the points that are being raised in the active discussions that we are having with the joint venture about what might be possible there.

The earlier part of Mr Smyth’s question was about the supply chain. In response to Maggie Chapman, I indicated that we are assessing the situation with the supply chain, but we have to recognise that, when there is a transition from a refinery to an import terminal, substantial supply chain activity will be maintained due to the nature of the new activity. We need to do more work on examining exactly what that will look like.

Economy and Fair Work Committee

Petroineos Grangemouth

Meeting date: 13 December 2023

Neil Gray

You will be aware that there are industrial reasons why we already have to import significant amounts of oil and gas, but particularly oil, into Scotland.

Economy and Fair Work Committee

Petroineos Grangemouth

Meeting date: 13 December 2023

Neil Gray

That is a fair comment. With a century-old refinery that has been loss making and has received intervention at numerous points over recent years, it is a fair assessment to say that there was a risk around its future, especially as it is competing with super-refineries elsewhere in the world, particularly in the middle east and China. The viability of refineries not just in Scotland and the rest of the UK but in this part of Europe is being driven down by that international competitiveness.

We have been in discussion with the joint venture for some time around making sure that there is a future for the Grangemouth site and looking at all the possible options for a just transition. We have previously raised points on hydrogen, carbon capture and a biorefinery. However, as I said, the first time that we were made aware of the decision was at the same time as the workforce were made aware. I have to say that it is admirable and credible that the joint venture chose to tell its workforce first and at the same time as it told us.