Grangemouth to reopen: Ineos says union strikes last-minute deal

Unite accept terms of survival plan in a 'dramatic U-turn' 

Heather Saul
Friday 25 October 2013 20:17 BST
Operator Ineos announced on Wednesday that it would shut Grangemouth
Operator Ineos announced on Wednesday that it would shut Grangemouth

The Grangemouth petrochemical site will re-open "with immediate effect" after Unite accepted a survival plan.

Owners Ineos have said it will re-open the plant and the oil refinery, in a move that followed a "dramatic U-turn" from the union. It said Unite have agreed to taking no further strike action for the next three years.

Union leaders accepted demands from managers on Thursday in a bid to save nearly 800 jobs at the site.

About half of the 1,370-strong workforce rejected the proposed changes to contracts earlier this week, which included a two-year pay freeze from 2014 to 2016, removal of a bonus up to 2016 and the end of the final-salary pension scheme.

Workers were told in a mass meeting this morning that the decision to shut down the site will be reversed. The news was met by cheering from the employees, according to reports.

Unite's Scottish secretary, Pat Rafferty, said: "This decision is clearly very welcome. Relief will ring right round the Grangemouth community, and across Scotland today. Hundreds of jobs that would have been lost can now be saved and £300 million will be invested into the plant.

Downing Street described the news as "very encouraging" and Energy Secretary Ed Davey said it was a "positive result" and a testament to the "many people in the UK and Scottish Governments who worked to make it happen".

Calum MacLean, Grangemouth chairman accused Unite of risking 800 jobs and one of the UK's largest manufacturing facilities "over a union official investigation before any verdict had been announced".

He added: “It then advised employees to reject the change essential to the survival of Grangemouth. Today's U-turn means Grangemouth now has an excellent future.”

In a press conference after the news had been announced, he told the media gathered no additional concessions had been demanded of the union by the firm. However, he did not rule out the possibility of some redundancies but stressed any job losses would be very limited".

Ineos chairman Jim Ratcliffe described accepting the terms of the survival plan as a "victory for common sense".

Ineos said in a statement: “Unite's withdrawal of its opposition to the company's survival plan, which was already supported by 50 per cent of employees on the site, has allowed the shareholders to invest a further £300 million in the company.

“This money will be used to fund ongoing losses and to finance the building of a gas terminal to bring in shale gas ethane from the USA.

“The Scottish government has indicated it will support the company's application for a £9 million grant to help finance the terminal and the UK Government has given its prequalification approval for a £125 million loan guarantee facility.”

Scotland's First Minister Alex Salmond said he was "delighted" by the news and praised the efforts of "all concerned" for preventing "what could have been a potential disaster".

”It's been a great team effort from all concerned, including the unions and workforce, the management, Governments - and BP, who have made a material contribution to help defend and secure Scottish jobs and livelihoods", he said.

“I am delighted that people have rallied round to protect these jobs, and now we can all agree that Grangemouth has an outstanding future."

More to follow

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