Britain’s last ethylene plant at Grangemouth has been saved by the UK Government - securing 500 jobs and hundreds more across the UK supply chain. Thanks to a landmark partnership between the UK Government and INEOS, the future of this vital site is now protected. With over £120 million in UK Government support and major investment from
INEOS, the Grangemouth plant will stay open.
This funding package will help secure the site’s operations and contribute toward improving energy efficiencies, reducing carbon emissions and increasing productivity, helping to secure the site’s long-term competitiveness and sustainability — INEOS has spent over £100 million over the last year maintaining operations at the site.
The Grangemouth plant is vital for the whole UK economy. It produces ethylene which is essential for medical-grade plastics and use in the chemical supply chain. These plastics are also vital to key industries, including advanced manufacturing, automotive, and aerospace, where they are used in nearly every product.
The Government’s Industrial Strategy published earlier this year identifies chemicals as a vital foundational sector that underpins the UK’s high-growth industries like defence and advanced manufacturing by producing the materials they all depend on, while also being essential to many supply chains.
The UK Government is also backing the chemicals sector through targeted support to bring down energy costs, including through the British Industrial Competitiveness Scheme – which will significantly reduce costs for businesses in sectors including chemicals by up to 25% — and the British Industrial Supercharger, which will save Britain’s most energy-intensive firms money on their electricity costs.
The plant also links to the Forties Pipeline System, which is key for transporting North Sea oil and gas to onshore facilities. Without Government intervention, the plant’s closure would have seriously affected hundreds of on-site workers, impacted thousands of jobs regionally, and devastated supply chains.
Prime Minister Keir Starmer said: “When we said we would protect jobs and invest in Britain’s future, we meant it - and this is proof. Through partnership, determination, and our Modern Industrial Strategy, we’re delivering new opportunities, fresh investment, and security for the next generation of workers in Scotland.”
INEOS CEO Sir Jim Ratcliffe said: “This £150 million investment in the future of a major UK industrial site demonstrates INEOS and the UK Government’s commitment to British manufacturing. The support of the UK Government is welcome as we work to deliver competitive and efficient low-carbon manufacturing for the UK, long-term.”
The agreement includes safeguards to protect taxpayers’ money, such as strict assurances that the funding can only be used to improve the site, and also gives the UK Government the right to share in future profits. The chemicals sector across Europe has faced significant challenges in recent years, including high energy costs, with around 40% of remaining European ethylene capacity having recently closed or is remaining at risk.