Grangemouth Refinery

Grangemouth refinery is a mature complex oil refinery located on the Firth of Forth in Grangemouth, Scotland. It is Scotland's only oil refinery (one of nine in the UK), and is also the UK's second-oldest; it supplies refined products to customers in Scotland, northern England, Northern Ireland, as well as occasionally further afield.

History

Grangemouth Refinery commenced operation in 1924 as Scottish Oils, owned by the Anglo-Persian Oil Company which in turn was a forerunner of British Petroleum (later BP). Its location was made ideal by the adjacent Grangemouth Docks which supported the import by ship of Middle East crude oils for processing, plus the cheap availability of large areas of reclaimed flat land.

The refinery was forced to shut down between 1939 and 1946 by World War 2 and the resulting drying up of crude feedstock imports. When operations recommenced in 1946, the refinery underwent a number of major expansion programmes, including the building of an adjacent petrochemicals complex to process some of the refinery waste and byproduct streams.

In 1954 the refinery was connected to the Finnart Ocean terminal at Loch Long on the west coast of Scotland by a 58-mile pipeline, to allow the import of crudes via deep-water jetty, which supported the use of larger oil tankers. Later on in the century a second line was also installed to allow the direct supply of finished refinery products to the Finnart terminal, primarily for export to markets in Northern Ireland.

In 1975 the discovery of North Sea Oil brought the commissioning of the Kinneil Crude Oil Stabilisation terminal, which connected directly into the BP Forties pipeline system; this plant serves to stabilise Forties Crude oil for either export to third-parties or feeding into the Refinery, and allowed the processing of North Sea oil as part of the refinery crude 'slate' of feedstocks.

In 2005 the refinery and connected petrochemicals complex (excluding the Kinneil terminal) was put on the market by BP as part of the Innovene sale, this company being made up of all of BP's petrochemicals plants and businesses. Innovene was eventually purchased by INEOS, a privately-owned chemicals company.

Operation

The Grangemouth Refinery is a major landmark, with its numerous gas flares and cooling towers visible across a wide area of the Scottish Lowlands.

The refinery has a 'nameplate' capacity for processing 210,000 barrels of crude oil daily. It currently employs about 1,200 permanent staff, and a further 1,000 contractors.

It processed approximately 400,000 tonnes of imported crude oil annually until the end of the Second World War, and subsequent expansion programmes have increased refining capacity to an excess of 10 million tonnes per year [ [http://www.ukpia.com/industry_information/refining_uk_refineries/refineries/ineos_grangemouth_refinery.aspx UKPIA - Overview of Grangemouth Facility] ] .

The BP-owned North Sea Forties pipeline system terminates at the Kinneil processing facility, and surplus crude is exported via pipeline to an oil depot downstream on the Firth of Forth, and subsequently shipped out from the jetties at the Hound Point loading terminal onto oil tankers suitable for the shallow water of the Forth.

Annual output share

* Petrol - 22%
* Diesel - 24%
* Kerosene & Jet fuel - 13%
* Gas oil - 8%
* Fuel oil - 15%
* LPG/petrochemical feedstocks - 12%
* Fuel gas/other - 6%

afety record

In 2002, BP the former owners of the plant, were fined £1m for breaching safety laws. [ [http://news.bbc.co.uk/1/hi/scotland/1767896.stm BBC News | SCOTLAND | BP fined £1m for safety offences ] ] Ineos went to court in April 2008 over claims that it had polluted the River Forth in summer 2007. [ [http://news.bbc.co.uk/1/hi/scotland/tayside_and_central/7361151.stm BBC NEWS | Scotland | Tayside and Central | Court action for refinery bosses ] ]

2008 strike

In 2008, Ineos proposed that plant workers start contributing a share towards their own pensions (a final salary pension scheme [ [http://news.bbc.co.uk/1/hi/scotland/7363121.stm BBC NEWS | Scotland | 'Workers left with no alternative' ] ] ), instead of the current situation of non-contributory fixed salary pensions. The request would have obliged future new entry employees paying 6% of their salary, phased in over a six year period. However, 97% of the Unite trade union's 1,250 members at Grangemouth voted in favour of strike action. David Watt, of the Institute of Directors in Scotland, believes that the average Grangemouth Refinery plant worker earns £40,000 per year (nearly twice the Scottish average.) [ [http://news.bbc.co.uk/1/hi/scotland/7361023.stm BBC NEWS | Scotland | 'Be realistic' call to petrol workers ] ] However, this was disputed by the Deputy General Secretary of the Scottish Trades Union Congress, Dave Moxham, who stated that they earn £30,000 per year. [ [http://news.bbc.co.uk/1/hi/scotland/7363121.stm BBC NEWS | Scotland | 'Workers left with no alternative' ] ]

The strike began at 6am on 27 April 2008 (Sunday), and lasted until 29 April (Tuesday) [ [http://news.bbc.co.uk/1/hi/scotland/tayside_and_central/7374571.stm BBC NEWS | Scotland | Tayside and Central | Deal could end refinery dispute ] ] . The petrol supply of Scotland was affected by the strike, as panic buying led some petrol stations across the country to run dry. [ [http://news.bbc.co.uk/1/hi/scotland/7360339.stm BBC NEWS | Scotland | The petrol picture in Scotland ] ] However, the Retail Motor Industry Federation has stated that there is a stock of fuel that could last 70 days, easily covering the lapse in production so long as no panic buying occurs. [ [http://news.bbc.co.uk/1/hi/scotland/tayside_and_central/7358392.stm BBC NEWS | Scotland | Tayside and Central | Q&A: The Grangemouth dispute ] ] With the shutdown of the plant, BP closed the Forties pipeline system as their Kinneil terminal relies on power from the Grangemouth refinery [ [http://news.bbc.co.uk/1/hi/business/7370441.stm BBC NEWS | Business | Opec warns oil could reach $200 ] ] . With the shutdown of Kinneil, 70 North Sea oil platforms were forced to shutdown or reduce production, at the cost of 700,000 barrels a day [ [http://news.bbc.co.uk/1/hi/business/7370441.stm BBC NEWS | Business | Opec warns oil could reach $200 ] ] . Shutting the pipeline down reduced Britain's petroleum supply (the Forties pipeline provides 30% of the UK's North Sea oil), and cost the UK economy £50m in lost production every day it remains closed. [ [http://news.bbc.co.uk/1/hi/scotland/tayside_and_central/7369043.stm BBC NEWS | Scotland | Tayside and Central | 'Weeks' to re-start strike plant ] ]

References

External links

* [http://www.innovene.com/genericarticle.do-categoryId=9002816&contentId=7005620.htm Website at Innovene]
* [http://www.amicustheunion.org/ Unite Union]
* [http://news.bbc.co.uk/1/hi/scotland/tayside_and_central/7358392.stm Q&A: The Grangemouth dispute] - BBC news
* [http://www.energyinst.org.uk/education/refineries/grangemouth.htm Institute of Petroleum - Refineries - Grangemouth] – history of refinery