INEOS workers begin Grangemouth refinery strike

27 April 2008 06:00  [Source: ICIS news]

By Mark Watts

 

LONDON (ICIS news)--Workers at INEOS’ 200,000 bbl/day refinery in Grangemouth, Scotland, started a planned two-day strike on Sunday due to disputes over the company’s pension fund.

 

INEOS has shut down the refinery along with two crackers, and has declared force majeure on polyethylene, polypropylene and butadiene.

 

The closure has forced BP to shut the Forties oil pipeline, as the site feeds power and steam to its gas separation plant at Kinneil – a hub for North Sea oil processing.

 

The pipeline supplies the UK with 700,000 bbl/day of liquids from about 70 oil fields in the North Sea. June Brent crude surged more than $3/bbl ahead of the strike to reach around $117.50 late on Friday.

 

Industry body Oil & Gas UK estimated that the shutdown would cost the country £50m per day.

 

On Saturday its chief executive Malcolm Webb made a last-ditch call for the government to intervene in the dispute "to ensure that the country is not held to ransom in this manner".

 

"This is now affecting some 80 companies and their operations which are in no way connected to or involved in this dispute," Webb said in a statement.

 

Around 1,200 were on strike over plans to end the final salary pension scheme for new workers. Unite plans to continue industrial action on Monday.

 

Talks through the conciliation service Acas broke down as the union rejected an offer from the company to take the proposals off the table for three months of discussion, according to INEOS.

 

The company said the refinery would be kept on "warm stand-by" during the strike period enabling them to get it back to full capacity within two to three weeks.

 

Meanwhile, the majority of motorists appeared to have heeded advice from ministers and trade bodies not to "panic buy" fuel ahead of the strike, though there was significanly higher activity at Scotland's petrol pumps on Saturday and some were running short.

 

"In Scotland, the problem is mainly one of distribution as substantially higher levels of demand than normal are causing stock outs at some filling stations," said Chris Hunt, director general of the UK Petroleum Industry Association.

 

"Every effort is being made to replenish filling stations but I urge motorists to maintain their normal pattern of re-fuelling," he said in a statement on Saturday, adding that imports were being arranged to cover the post strike period when the refinery was coming back on stream. 

 

Graeme Paterson contributed to this article 

By: Mark Watts
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