Petrochemical giant ExxonMobil has said “deliberate” policies of the UK Government policies are “undermining” the business – with this contributing to the decision to close a key site in Scotland.
Paul Greenwood, the chairman of ExxonMobil spoke out the day after it was confirmed the firm plans to close its ethylene manufacturing plant in Mossmorran, Fife, in February next year.
The closure is expected after the company “considered various options to continue production and tested the market for a potential buyer”, he said.
The Scottish Government has already pledged it will “explore all options” to support workers at the plant – but Deputy First Minister Kate Forbes also made clear it was “crucial” that Labour ministers at Westminster “consider what more they can do for the workers at the plant and take urgent action”.
However, UK industry minister Chris McDonald has indicated the Government is not prepared to keep the site open.
Mr McDonald told MPs on Tuesday that “where Government has intervened in the past, it has been where there’s been a fundamentally sound business proposition”.
However, Mr Greenwood partly blamed Government policies for the closure decision.
Speaking on the BBC’s Today programme, the ExxonMobil chairman said there are “four keys to success” in the sector – a cheap and abundant supply of ethane, along with low-cost operations, good market prices for ethylene and a skilled workforce.
Mr Greenwood said: “I will be blunt – I have one of those keys to success in place, and that is a brilliant workforce.
“Two of those keys I deliberately do not have because of Government policy.
“Take the ethane supply: you know what’s happening in the North Sea, we’ve had windfall taxes, we’ve had a ban on production licences – I need cheap sources of abundant ethane and I do not have them, because the North Sea – because of Government policy – is declining rapidly and that ethane is increasingly high price.
“If I come to the second part, which is I need to operate at low cost, I have to have a burden put upon me of CO2 taxes – we paid £20 million last year in CO2 taxes, that will double in the next four or five years. My international competitors do not have those costs.
“I also have to deal with high energy costs and those kind of things, so these are deliberate Government policies that are undermining us.”
Scotland’s Deputy First Minister Kate Forbes said again she was “extremely disappointed” by the decision to close the Mossmorran plant.
Ms Forbes however said that in discussions with the firm both last week and on Monday she had been “surprised by how quickly that conversation moved from them actively marking the plant to finding no viable buyer, and therefore moving to the news that they would begin closure in February”.
Speaking on BBC Radio Scotland’s Good Morning Scotland programme, Ms Forbes added: “You have to look at the reasons ExxonMobil have given for their decision, and I have pushed them on these decisions in our conversations.
“But they have cited some of the policy and fiscal decisions that have been made in the UK that are making business less competitive.”
While she accepted there were “challenges” for the company in terms of market conditions and high energy prices, she added: “That will be cold comfort to the 179 ExxonMobil staff and the 250 contractors who yesterday learned that their jobs are at risk.”
The Scottish Government’s priority is now to look at “whether there is an alternative future at the site” as well as to support the workforce at a “really troubling time time”, she added.
Ms Forbes said: “What we want to be focusing in on is how we create new economic opportunities there, how we engage with the company, how even if they struggle to find a buyer whether there is other options for the site.
“The workers at the site are extremely highly skilled, they are absolutely critical to any just transition we take in this country, so we can not afford to lose them.
“And I think we need to do all that we can to retain that as a key employer and a key industrial site.”
