Fuel shipped in as oil refinery strike begins

Sadie Gray
Monday 28 April 2008 00:00
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The union representing 1,200 striking workers at the Grangemouth oil refinery have taken out advertisements in seven Scottish newspapers today explaining their reasons for the 48- hour stoppage, which has led to fears of the country grinding to a halt.

Unite claimed in the adverts that workers had no choice but to strike, and apologised for any inconvenience caused by the two-day walkout, which began at 6am yesterday as staff downed tools and left the plant. A picket line rally addressed by politicians was attended by 200 supporters.

The strike has sparked panic buying at the pumps across Scotland and in some parts of northern England. BP has shut down the crucial Forties North Sea pipeline for safety reasons, but the situation eased somewhat over the weekend as ministers appealed for restraint and announced the import of fuel supplies from Europe.

Nevertheless, a number of garages across Scotland reported running out of fuel, while some have introduced rationing and have increased prices. Strikers are furious at plans to close their final salary pension scheme – a move which Unite says will save £1.5m a year for a company which makes £3m a day at its Grangemouth plant alone. Discussions over the pensions issue have been going on for eight months.

Catherine Bithell, of Unite, said: "It's a grave step, and they're doing it because they've been left with no alternative by Ineos management, who seem to be hell-bent on closing down a viable, affordable and well-funded final salary scheme. We've said all along that we want to sit down with the company and talk about central plans that don't involve the closure of the final salary scheme."

The prospect of a quick resolution to the dispute appears remote. The Ineos chief executive, Tom Crotty, said: "We have made concession after concession from our original position to try and keep them negotiating. All of that has failed and that is why we are in this terrible position which we should just not be in."

Ineos claims the scheme costs £10,000 per employee per year and accounts for a quarter of labour costs, which could rise to 50 per cent as pensioners live longer. It wants to invest £750m in the Grangemouth plant to secure its future, but says pension costs could undermine the economic case for doing so. Grangemouth, which Ineos bought from BP in 2005, is the only oil refinery in Scotland and the country's major fuel supplier. It also powers BP's Kinneil plant, which deals with the 700,000 barrels of oil a day that arrive from the Forties pipeline. The pipeline, which brings in 30 per cent of the UK's oil output, was closed on Saturday night at an estimated cost to the UK economy of £50m for every day of closure. Malcolm Webb, the chief executive of industry body Oil and Gas UK, said: "Around 80 companies and their operations are now caught up in a situation which has nothing to do with them and which should have been avoided.

"We urge the Government to broker an agreement that will ensure that any continuation of the dispute will not have the same secondary impacts on businesses unconnected to the industrial action."

Business Secretary, John Hutton, said the Government had made every effort to try and prevent the action from taking place.

He said: "It's not justifiable, we're bringing parties into this who are innocent bystanders."

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