Petroineos, a joint venture between PetroChina and Ineos, is proposing upgraded redundancy terms and an above-inflation pay rise to entice Grangemouth refinery workers to stay on at the site until 2025. This move comes after Petroineos announced in November that the Grangemouth oil refinery, Scotland's last remaining, might cease operations by 2025 due to market pressures and the energy transition.

During a meeting with the Holyrood Economy and Fair Work Committee, Petroineos executives revealed that discussions with unions had progressed, leading to advanced talks on financial incentives to retain skilled workers during the transition process. Despite not formally initiating the closure process, the company has proposed enhanced measures, including an above-inflation pay rise and an upgrade to redundancy terms via the annual pay review.

Approximately 500 people are currently employed at the Grangemouth site, with around 100 ongoing roles anticipated post-transition. Of the expected 400 job losses, around 100 employees are eligible for retirement, and an additional 50 will be required for decommissioning and demolition of the site for up to three years starting in spring 2025.

While Petroineos has not calculated the impact on supply chain jobs, discussions are ongoing with Falkirk Council and the Scottish Government to mitigate the local community's impact. The refinery's exact closure date remains undecided, and operations continue as usual, with a focus on transitioning the Finnart terminal into a bulk diesel import node and modifying the Grangemouth jetty for improved fuel resilience and security.

Petroineos has affirmed that the refinery closure will not affect plans for a possible biorefinery or the production of blue hydrogen with carbon capture at Grangemouth. The company views this as part of the "just transition" toward a non-fossil fuel economy, emphasizing the importance of supporting Grangemouth employees through this significant shift.

Scotland's Economy, Fair Work, and Energy Secretary Neil Gray stated that a specific just transition plan for Grangemouth would be published in spring next year, aiming to retain as many skilled workers as possible in the energy sector and other related industries. The Scottish government has allocated £500 million over ten years for just transition initiatives, demonstrating its commitment to supporting workers during this period of change.