£40m to extend Grangemouth licence not good use of public money – minister
The refinery is expected to continue operations until next spring before becoming a fuel import terminal.
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Your support makes all the difference.Providing £40 million to Grangemouth to extend a licence for its refinery would not be a good use of public money, a UK Government minister has said.
Last year, Petroineos announced the refinery near Falkirk will change into an import terminal, but it will stay open until next spring.
The announcement sparked job fears, with hundreds of people employed at the site.
MSPs heard in December that the refinery will need to pay £40 million for a licence to operate beyond May 2025.
Appearing before Holyrood’s Economy and Fair Work Committee on Wednesday, energy security minister Graham Stuart rejected the idea of funding the licence.
Responding to a question from SNP MSP Gordon Macdonald – who said the amount would be a “drop in the ocean” compared to the money raised by oil and gas in the past 50 years – the minister said: “If Petroineos can’t see the commercial sense in investing in a refinery which they themselves have been unable to make profitable over a substantial period, which they say is inherently inefficient, I do not think that would be a sensible use of British taxpayers’ money.
“Especially as our estimate is the change from being a refinery to being an import terminal does not fundamentally effect the energy security of the UK, or indeed Scotland.”
Former Scottish Government minister Kevin Stewart and Alba Holyrood leader Ash Regan also quizzed Mr Stuart on the response the UK Government would have if it were a refinery in England under threat.
Asked by Mr Stewart if they would be so “hands off”, the minister rejected the premise.
“I don’t recognise that we are hands off,” he said.
“We have a devolved settlement with certain things on which the Scottish Government leads, but we’re working closely with them.”
The minister also pointed out that he was in the process of giving evidence at Holyrood and would attend an event on Grangemouth on Thursday.