Plan for future of Grangemouth

Plans to secure a long-term industrial future for Grangemouth have been stepped up as a feasibility study sets out nine options for its future.

The plan – which is backed by £25 million from the Scottish Government and £200 million from the UK Government – will support jobs, unlock investment and drive growth.

The £1.5 million feasibility study – published today by EY – follows the recent decision by Petroineos to decommission the oil refinery.

It has identified credible long-term industrial options for the Grangemouth site and explored how Grangemouth can build on its skilled workforce, local expertise and long heritage as a fuel leader in Scotland to forge a new path in low carbon energy production.  

The report provides nine proposals likely to attract private investment, including plastics recycling, hydrogen production and other projects that could create up to 800 jobs by 2040.

It follows First Minister John Swinney’s announcement of £25 million to establish a Grangemouth Just Transition Fund, which will support businesses and stakeholders to bring forward investible propositions for the site over the next 12 months, and the Prime Minister’s announcement last month of £200 million to help unlock Grangemouth’s full potential.

First Minister John Swinney said:

“We will leave no stone unturned in order to secure the future of the Grangemouth refinery site, and the Scottish Government has already committed or invested a total of £87 million to help do so.

“Grangemouth is home to over a century of industrial expertise and employs thousands of highly skilled workers, placing the site at a massive competitive advantage and creating a unique opportunity for investors.

“Everyone working at Grangemouth’s refinery – and in the wider industrial cluster - is a valued employee with skills that are key to Scotland’s economic and net zero future.

“This report sets out a wide range of viable alternatives for the refinery site, demonstrating that a long term, new industrial future at Grangemouth is achievable. We will continue to work closely with the UK Government to realise these opportunities and Scottish Enterprise stands ready to support inward investors looking to progress any of these technologies.”

UK Energy Minister Michael Shanks said:  

"We committed to leaving no stone unturned in supporting an industrial future for Grangemouth delivering jobs and economic growth. 

"This report and the £200 million investment by the UK Government demonstrates that commitment. 

“We will build on Grangemouth’s expertise and industrial heritage to attract investors, secure a long-term clean energy future, and deliver on our Plan for Change.” 

To kickstart the process, Energy Minister Michael Shanks and Acting Cabinet Secretary for Net Zero and Energy Gillian Martin co-chaired a meeting this morning (Wednesday 19 March) of the Grangemouth Future Industry Board with local industry leaders, Falkirk Council, trade bodies and unions. Scottish Enterprise and the UK Government’s Office for Investment will work with Petroineos to market the proposals set out in Project Willow and seek investor interest.   

Alongside launching a search for investors, both governments have also committed to review the Project Willow policy recommendations and understand how government funding can be deployed to mature proposals from the private sector. 

The nine projects include: 

• Waste: hydrothermal upgrading (breaking down hard to recycle plastics), chemical plastics recycling, ABE biorefining (breaking down waste material)
• Bio-feedstock: breaking down Scottish timber into bioethanol, anaerobic digestion of bioresources and digestate pyrolysis, HEFA (conversion of Scottish cover crops into sustainable aviation fuel and renewable diesel using low carbon hydrogen).
• Offshore wind conduit: Replacing natural gas with hydrogen, using low carbon hydrogen to produce methanol and convert it to SAF, producing low carbon ammonia from hydrogen for shipping and chemicals. 

Access the report at: Project Willow: Grangemouth investment opportunities