Executive claims warning 'taken out of context'
Grangemouth chemical plant has 15 year guaranteed future says Ineos executive
A senior executive of Ineos, owner of the giant chemical facility, has written to the workforce following comments made by one of his colleagues at a conference in Edinburgh suggesting the “cracker” plant’s long term survival was in doubt.
John McNally, chief executive of Ineos UK Olefins and Polymers, says in a memo that the comments by fellow executive Gary Haywood had been taken out of context and the plant had a plentiful supply of shale gas from the US.
According to The Scotsman, which has seen the memo, Mr McNally says: ” The reality is that we have at least 15 years of assured gas supply from the US which assures the future of the business in the medium to long term.”
However, Mr McNally adds: “Predicting what happens after that is, of course, more difficult.”
This may be taken as a further indication that the long-term future of Grangemouth will rest on locally-sourced gas. Mr Haywood told the fracking conference last week that shipping gas from other parts of the world was not a long term solution to its needs. The company has applied for licences to drill locally.
Daily Business noted after the conference that Ineos had signed an agreement last year to build a new import terminal that would secure the plant for the forseeable future.
Ineos Olefins & Polymers UK reached agreement with the UK government last July for an infrastructure loan guarantee allowing it to raise the funds necessary to invest in the terminal to store and process ethane from shale gas at Grangemouth as North Sea supplies dwindle. It said at the time that the project protects thousands of jobs in Scotland and across the UK.
After the signing ceremony, Jim Ratcliffe, the company’s chairman, said: “Without doubt, this is one of the most important projects of recent times in Scotland, with implications to be felt right across the UK, not only for employment but also for manufacturing in general
“Our ability to import US shale gas underpins the future of manufacturing at Grangemouth and across many businesses in Scotland. It is a vital step towards preserving the long term future of the Grangemouth site and those businesses that depend upon its continued presence in Scotland.”
Ineos has invested more than £300m at its Grangemouth site as part of a long term survival plan necessary for the site to manufacture petrochemicals beyond 2017. The loan guarantee from the UK Government enables it to raise financing on £230m specifically to cover the import facility and storage tank to be built at the site.