We will NOT nationalise Grangemouth oil refinery, admits Labour

Sir Keir Starmer has been accused of ‘industrial vandalism’ as Labour confirmed it would not strike a rescue deal to nationalise the Grangemouth oil refinery.

Ahead of the Prime Minister’s major UK investment summit on Monday, his energy department finally admitted that pleas for the UK government to buyout Scotland’s only refinery - even if only on a temporary basis - were not being considered.

Desperate union chiefs, workers and campaigners have for weeks implored UK ministers to take a stake in the oil refinery to keep it running amid fears closing it would threaten the country’s energy security, and de-industrialise the local area.

However, in a devastating hammer blow to thousands of Scots workers, an energy department insider said: ‘The company [Petroineos] were very clear that there was no viable commercial future for the refinery operation. 

It would not be right for the Government to underwrite a business that does not have a viable commercial future.’

Grangemouth’s owner Petroineos announced it was shutting the facility in the second financial quarter of 2025

And an official spokesman for the Department of Energy and Net Zero said: ‘We have never received any proposals about nationalising Grangemouth and there are no discussions under way about doing so.

‘We are focused on finding a viable clean energy future for Grangemouth and have provided £100 million funding, alongside the Scottish Government, to help the workforce find good, alternative jobs and invest in the community.’

Grangemouth’s current owner Petroineos announced it was shutting the facility in the second financial quarter of 2025 with the loss of 400 jobs last month - to the fury of the local community.

Thousands more ancillary workers will also be affected by the closure according to a report by PriceWaterhouseCooper carried out on behalf of Scottish Enterprise.

Despite pressure from unions and campaigners for the UK government to take a stake in the plant the Mail on Sunday has been told this is ‘not something the government is looking at’ and it is ‘not on the table’.

Last night local Labour MP Brian Leishman said the newly-revealed position had filled him with ‘despair’ and called on Sir Keir to ‘learn from what happened to the miners of the 1980s,’ referring to Margaret Thatchers closure of the mines.

Sir Keir Starmer will not step in to save the refinery at Grangemouth despite the pleas of local Labour MP Brian Leishman

Unite general secretary Sharon Graham said: ‘What is happening in Grangemouth is an act of industrial vandalism. Unite will not allow Scotland’s only refinery to be mothballed with the loss of hundreds of jobs. 

It doesn’t matter the colour of a party’s rosette, Unite will always ferociously hold the government to account when they are wrong and putting jobs at risk,’ adding: ‘We need public investment to come with public stakes that guarantee jobs and a long-term commitment.’

In September, the site’s current owners Petroineos, a joint venture between Asia’s largest oil and gas producer PetroChina and Ineos - the chemicals firm founded by Manchester United’s billionaire co-owner Sir Jim Ratcliffe - blamed global competition and falling demand for fossil fuels as they announced its impending closure next year. 

It sparked serious concern over a raft of job losses at the site, which produces vast quantities of petrol, diesel, heating oil and aviation fuel for the UK.

In response Labour and SNP Ministers hastily added £20 million to an existing £80 million growth fund for the local Falkirk area.

They also talked up Project Willow, a joint government investment scheme that would examine ways of creating a new long-term industry at the site, focused mainly around storing green renewables.

Yet unions hit back, and insisted the oil refinery must be saved.

Addressing the Unite Union conference in Dundee, general secretary Sharon Graham said Energy and Net Zero secretary Ed Miliband and Prime Minister Sir Keir Starmer were ‘on notice’.

She said: ‘The government must make the necessary investments to safeguard its future. Labour must be forced to act.’

The Keep Grangemouth Working campaign group has also blasted the decision by PetroIneos to close the site and called on the UK and Scottish Governments to act to save jobs.

Last week, local MP Brian Leishman submitted a House of Commons Early Day Motion calling on the UK Government to buy a so-called ‘transitional stake’ in Grangemouth.

That would see the UK Government takeover the plant from as early as next year until a ‘viable’ green energy alternative is found for the plant.

It has been signed by a dozen MPs, including fellow Labour MPs Euan Stainbank and Diane Abbott, and has been supported by campaigners.

In an article for this newspaper published today, Mr Leishman suggested that he had held ‘early discussions’ with UK ministers over his plans.

Labour MP Brian Leishman called on the UK Government to buy a so-called ‘transitional stake’ in Grangemouth

However, a UK government source said that no such proposals were being considered.

They said that nationalisation - either temporarily or in full - was not being discussed by ministers or policy officials.

As well as threatening a Labour civil war, the newly-revealed government position may cast a long shadow over Sir Keir Starmer’s big UK Investment Summit tomorrow, during which his Scotland Office will tout the government’s newly-launched industrial strategy.

It is another bombshell ahead of the major event on Monday, intended to showcase the attractions of Britain to international business, after a £1billion deal was seemingly pulled after Sir Keir’s ministers criticised P&O Ferries.

Ports and logistics giant DP World, the parent company of P&O Ferries, reportedly dropped a major announcement about its London Gateway container port after a press release from Angela Rayner and Transport Secretary Louise Haigh described action by P&O Ferries towards seafarers as ‘outrageous’ and a ‘national scandal’.

Discussions about the future of Grangemouth have also involved claims there is a serious prospective buyer that could step in to keep the refinery going.

North American petroleum giant Hudson Reid Holdings Inc., headed by Canadian businessman Garth Reid, is reported to be interested in the site.

Stacey Oil Services - an equipment company based at Portlethen, near Aberdeen - is also understood to have been working on a possible deal, however Petroineos says it has not received any ‘credible’ bids for the facility.