Oil Refining Sector

Seamus Logan Excerpts

Thursday 11th December 2025 Westminster Hall

[Seamus Logan (Aberdeenshire North and Moray East) (SNP)]

It is a pleasure to serve under your chairmanship, Mr Western. I commend the hon. Member for Brigg and Immingham (Martin Vickers) for securing this important debate. I also acknowledge the contribution of the hon. Member for Alloa and Grangemouth (Brian Leishman), who spoke with his usual passion, but today I believe with a degree of anger as well, and rightly so.

A just transition supports and protects existing oil and gas sector workers through—I emphasise “through”—the transition to a world-class renewables workforce, a transition in which Scotland is well placed to lead the world. I want to share the following quote:

“‘just transition’ has now become meaningless for so many people and that’s a failure… People should feel like that’s not something done to them, but something they’re part of shaping.”

That was said by the Minister for Energy in a recent interview with the Holyrood magazine. Sadly, for thousands of workers in North sea upstream, midstream and—in the case of refining—downstream jobs, a just transition is far removed from the reality that they face.

The workers now made redundant are angry at the UK Government’s failure to support their transition. Their families and communities are also angry, as are we, their representatives. We know that the just transition is doomed to fail because of three things: first, the failure to press forward with renewable energy schemes in north-east Scotland at the urgent pace that is required; secondly, the failure to allow new exploration licences while persisting with the crippling energy profits levy on the oil and gas sector; and thirdly, the failure to protect refinery jobs at Grangemouth and Mossmorran. Today I learned that 7,000 business leaders, workers and companies have signed a letter to the Prime Minister in which they demand change to the EPL to avoid the projected 1,000 job losses per month.

Looking specifically at the situation in Grangemouth in Scotland, Anas Sarwar, the leader of the Labour party in Scotland, said that a Labour UK Government would

“step in to save the jobs at the refinery and to invest in that transition…and we would put hundreds of millions of pounds behind it to make it a reality.”

No doubt the Minister will cite the £200 million promised to support Grangemouth, and reference has been made to the Scottish Government’s contribution. Of course, today brings good news in that regard, with MiAlgae’s welcome investment announcement on top of the Celtic Renewables project. The Scottish Government are an active partner in funding those projects, and we welcome the investment. However, the funding announced today amounts to only £7.73 million in total, and the 280 jobs —perhaps more—will not be fully realised for five years, if ever. Where is the rest of the promised £200 million? Where is fulfilment of the promise made by the leader of the Labour party in Scotland? Where is the intervention that occurred for Scunthorpe? People need work now. Families need certainty, but all they face this Christmas is uncertainty. In the meantime, the refinery workforce has been largely cast aside.

Looking further afield in Scotland, including Prax Lindsey, the UK has lost a third of its oil refineries just this year, on this Government’s watch. Furthermore, it is an uncomfortable truth for the Government that the UK’s uniquely high energy costs—the highest in the G7—are one of the main factors harming the refining sector and industry more generally.

I acknowledge that the North sea basin is in decline, but the importance of sovereign capability in national security is often repeated from the Government Front Bench. It is particularly true in defence, but how can defence capability be even remotely claimed if the vital fuel needed to operate tanks, ships and aircraft is acquired in the quantities needed through imports from abroad? Those imports can hardly be described as secure in this currently very dangerous world. Refining sites, as mentioned by the hon. Member for Alloa and Grangemouth, have great potential for such things as sustainable aviation fuel production, but this remains a jam tomorrow promise. This is not remotely a positive trend for our economy, our environment, or, vitally, our national security.

I must press the Minister to address these questions. How can she tell the thousands of directly employed and supply chain workers at Grangemouth, Prax Lindsey and the many other sites and companies that are shedding workforce in the oil and gas sector that they are part of shaping the just transition? What assurance can she give those workers that the future is bright, especially when the Acorn project in my constituency faces growing uncertainty, for example? I urge her to address those questions in her speech. The destruction of the refinery jobs is a repetition of the Thatcherite coal mine closures and the steel plant shutdowns, with no plan for the workers, their families and the communities affected. We have long memories in Scotland. Only with the full powers of independence in areas such as energy policy will the workforce at Grangemouth and elsewhere in Scotland’s oil and gas sector get the priority and the just transition to the future that they so richly deserve.

[Euan Stainbank (Falkirk) (Lab)]

It is a privilege to serve under your chairship, Mr Western. I congratulate the hon. Member for Brigg and Immingham (Martin Vickers) on securing this important debate, and I agree with his comments regarding the strategic importance of oil refineries for their communities—if only colleagues who were previously in government had grasped that before the decision by Petroineos to close Grangemouth in November 2023 was announced.

As has been remarked by colleagues, 2026 will mark the first year since, I believe, 1850 that Scotland does not have an oil refinery. This year marked 101 years since the start of oil refining in Grangemouth, and the date that refining ceased in April 2025 was a devastating time for the community I represent, the community of my hon. Friend the Member for Alloa and Grangemouth (Brian Leishman), the whole of Scotland and the United Kingdom. I remember sitting in the Falkirk council chamber when the announcement was made. The implications were obvious immediately: the loss of many of the highest-paying jobs in the Falkirk area, and the loss of a substantial tax base for Falkirk council and the Scottish and UK Governments. The announcement was completely unexpected for those of us in opposition parties, who were not in the know.

The failure of Government, as my hon. Friend the Member for West Dunbartonshire (Douglas McAllister) has articulated on behalf of the Scottish Affairs Committee, to prepare our community or have a plan in place for a no job loss transition at Grangemouth refinery has become symbolic of a similar story happening across industrial communities for decades. It was infuriating to find out from the Scottish Affairs Committee report that, through late 2023 and 2024, when it would have mattered, many of the decision makers failed to act to prevent the unjust transition at Grangemouth.

Petroineos confirmed to the Committee in April 2025 that, in the years prior to the announcement in November 2023, the then UK and Scottish Governments had requested information from the company, and subsequently chosen not to make an investment decision that would have saved the refinery. It was engaged for years with Government and no one lifted a finger to stop the path to the closure of refinery operations. Although I wish we had grasped the reality of the situation far more clearly in the transition from opposition to entering government, I welcome the determination of Ministers to get investment into Grangemouth quickly so that we can deliver that new industry to the community.

Today—two weeks after the Chancellor allocated further Government funding to Grangemouth to speed up investment decisions—marks an exceptionally positive announcement for the area. Up to 310 jobs are coming to Grangemouth to support the construction and operation of MiAlgae, a Scottish biotech success story. That does not, however, diminish the fact that many high-paid, high-skilled jobs have been lost, and the constant worry that they and the industry will never come back is justifiably the primary emotion that still grips my community.

We have an obligation not to repeat the mistakes of the past. We do not want the workers at Grangemouth, many of whom have not found employment since the closure in April, to be lost to the middle east, America or Norway. There is still a future for high-skilled refining workers at Grangemouth. That is why I welcome the Skills Transition Centre, announced back in February, funded out of the Falkirk and Grangemouth growth deal, which this Labour Government enhanced by £10 million when we came to power. However, the college that contains the skills centre is facing an existential financial crisis. One of the three campuses that constitutes Forth Valley college—the Alloa campus, in the constituency of my hon. Friend the Member for Alloa and Grangemouth —is directly jeopardised by the 20% real-terms cut inflicted on colleges since 2021 by the SNP Government.

The pathways for local kids to grasp the new industrial opportunities coming to our community will be actively barred if Government settlements for our further education sector are insufficient. Any consolidation that followed the closure of the Alloa campus would affect the courses available for thousands of young people in Falkirk, Stirling and especially Clackmannanshire. Kenny MacInnes, the principal of Forth Valley college, rightly reminded a conference recently that the college will be an instrumental part of whatever comes next at Grangemouth. The Scottish Government must bear that and Colleges Scotland’s recently published report in mind when they set their budget next year if they ever want to speak credibly about rebuilding opportunities in my community.

[Seamus Logan]

I note the hon. Gentleman’s remarks, but is he concerned about his own Government’s commitment to this important debate, given the row upon row of empty seats on the Government Benches?

--- Later in debate ---

[Lee Anderson]

We would expect this Labour Government to do a little bit more for these communities. Back in the ’80s, Labour was attacking the Tories for doing exactly the same thing: closing the vital industries. As I say, once the industry has gone, it is gone, and the skills that one generation passes on to another are gone as well. It is all well and good saying to somebody, “It’s okay, you can make windmills or solar panels,” or, “We’ll retrain you in green energy,” but they do not want that. This lot do not understand that there are still men and women in this country who want to get up in the morning and go do a proper day’s graft. They want to set the alarm clock at 10 o’clock at night, get up at half four or five o’clock in the morning and go do a proper day’s graft where they get their hands dirty. It is dangerous, dirty work, and they contribute towards their society by earning decent wages—good wages—and it keeps their communities going. If we lose that, we lose it for ever.

In the last year alone, we have lost a third of refineries, following the closure of Grangemouth, and now Lindsey is obviously doomed as well. That leaves just four refineries in the country. Why is Lindsey closing? Because it is being hit again and again with costs just to stay compliant with the UK emissions trading scheme. We know that to be compliant, refineries are required to submit verified emission reports to the UK ETS authority and to surrender sufficient allowances to meet the total emissions generated. As the hon. Member for Brigg and Immingham (Martin Vickers) said, those costs account for the highest expenditure in a refinery’s operating budget. Just let that sink in: the biggest cost to a refinery is one that has been inflicted upon it for the sole purpose of meeting net zero. In other words, it has been inflicted by this Government and the Energy Secretary.

[Seamus Logan]

I hear what the hon. Member says about oil refineries, and I share many of his concerns—you will have heard what I said—but I have also heard him and his party colleagues talking about “net stupid zero”. Does he actually believe that we should cancel all the wind farm projects and all the grid infrastructure rebuilding? Is that what he firmly believes we should do?

[Matt Western (in the Chair)]

Order. I remind Members that when they say “you” they are speaking to me.