Key Highlights
- Fears that the Fife Ethylene Plant at Mossmorran may be ‘quietly’ shut down by ExxonMobil.
- The UK government is concerned about ExxonMobil’s intentions for the site, with Scottish Secretary Douglas Alexander demanding a meeting to discuss plans.
- ExxonMobil faces demands to come clean about its future plans after reports suggest it is exploring options to sell its European plants.
- Around 500 jobs are at risk from potential plant closure, impacting local and national economic concerns.
Background on the Fife Ethylene Plant
The Fife Ethylene Plant in Mossmorran, operated by ExxonMobil, has been a significant contributor to the Scottish economy for decades. The plant produces ethylene, a vital raw material used in manufacturing plastics, medical equipment, car parts, and numerous other products.
Operations and Impact
The plant’s operations involve processing ethane from the North Sea, which is then heated to over 800°C before being mixed with steam. This process yields a product known as C5+, which is shipped to the Netherlands for further refining into synthetic fibres, food packaging, and insulation materials.
Government Concerns and Interventions
Senior government figures have expressed concern over ExxonMobil’s plans for the Mossmorran site. In October 2017, Scottish Secretary Douglas Alexander met with representatives from ExxonMobil to discuss their intentions. However, a UK Government source reported that the company has not been forthcoming with details regarding potential changes or policy measures that could secure the plant’s future.
Recent Job Losses and Financial Pressures
In June 2017, unions warned of an “avalanche” of job losses at Mossmorran. Altrad announced at least 98 redundancies, citing a downturn in work and cost savings imposed by ExxonMobil as the reason for the decision. Similarly, Bilfinger issued 10 redundancy notices, while Kaefer cut 55 jobs.
Industry Context and ExxonMobil’s Strategy
The Financial Times reported that ExxonMobil was seeking to offload its European chemical plants due to the impact of US tariffs and competition from China. This decision could potentially net the company up to £1 billion in asset sales across Europe, including assets in the UK and Belgium.
Financial Performance and Future Plans
ExxonMobil recorded profits of £25 billion in its third-best year on record for 2016. Despite this financial success, industry analysts suggest that the company is reevaluating its global strategy to cut costs and adapt to changing market conditions.
Conclusion
The potential closure of the Fife Ethylene Plant at Mossmorran raises significant concerns about job security in Scotland and the broader impact on local communities. As negotiations continue between government officials and ExxonMobil, stakeholders will be watching closely for any developments that could secure the plant’s future.
