Grangemouth chemical units now offline: INEOS

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LONDON (ICIS)–The Grangemouth, UK chemicals production complex operated by Switzerland-based producer INEOS has been shut down in anticipation of imminent strike action, the company said on Tuesday.

A company spokesman confirmed that all chemical production units have been taken offline, while the Grangemouth oil refinery co-owned by INEOS and PetroChina is currently in the progress of being wound down ahead of a 48-hour employee walkout expected to commence at 07:00 GMT on 20 October.

“The chemical plants are now shut down and refinery units are on their way down,” he said.

The company is currently in its second day of talks with trade union Unite at the Glasgow, UK office of industrial dispute resolution group the Advisory, Conciliation and Arbitration Service (ACAS) in a bid to avert the upcoming strike.

Units at Grangemouth are being brought down to a cold standby, which the company spokesman likened to stopping a car and removing the keys from the ignition, whereas a hot standby would be closer to leaving a car running but taking it out of gear.

INEOS claims that a hot standby would be too dangerous to guarantee the safety of the site during the shutdown.

It is difficult to gauge the duration of the shutdowns while arbitration talks are in progress, but it is likely to take several weeks for the site to return to normal operation once steps are taken to bring it back online, according to INEOS.

“We can’t put a definitive time on the start up but in [the] 2008 [strike] it took more than three weeks for the plants to be brought back on line in a safe and coordinated manner,” the spokesman said.

INEOS began ACAS talks with trade union Unite on the afternoon of 14 October.

The company has criticised what it decribed as Unite’s unwillingness to discuss safeguards for fuel supply to Scotland during the walkout. The company has predicted that a walkout at the site could bring the country to a standstill.

“INEOS was extremely disappointed at the lack of progress at yesterday’s ACAS meeting following Unite’s refusal to engage in any discussions about protecting North Sea Oil flows and fuels for Scotland,” the company said.

INEOS also criticised the union’s decision that site employee representative Stephen Deans be present at the talks. The company’s decision to launch an investigation into the conduct of Deans, also a local Labour party representative, was the basis for Unite initiating a vote on industrial action at the site.

“We remain hopeful that the union will agree to continue to provide steam to BP to ensure the ongoing operation of the Forties Pipeline System,” INEOS added.

According to figures derived from auditors PricewaterhouseCoopers (PwC) and released by INEOS on 14 October, the site lost £579m ($681m, $919m) between 2010 and 2013-to date, based on earnings before interest, taxes, depreciation and amortisation (EBITDA) and capital expenditure.

($1 = €0.74, €1 = £0.85, $1 = £0.63)