Kelly Norways 2024-03-29 07:50:28
Ineos Group Ltd. plans to close its ethanol plant at Grangemouth, UK, by the first quarter of 2025, the company has announced.
The Grangemouth ethanol business has been operating at a loss “for several years” due to falling demand in Europe and rising import pressure from other regions, the company said.
Stuart Collings, CEO of the Ineos Olefins & Polymers UK business, said supply would be maintained from Ineos’ other ethanol plant at Herne, Germany, where operations will continue.
“It is never easy to close any plant, and we are making this proposal only after a very thorough analysis,” Collings said. Consultations have begun with the Grangemouth ethanol unit’s 44 employees to plan for a “structured” closure, the company said. Ineos said its proposal would see all staff redeployed across the Grangemouth site.
The ethanol plant at Grangemouth was commissioned in 1982 and produces ethanol by adding water to ethylene. The plant has capacity for just under 200,000 metric tons per year of ethanol, according to S&P Global Commodity Insights data. Ethanol is used in the pharmaceutical, healthcare and sanitizer industries.
The closure adds to uncertainty around the Grangemouth site’s future after the previously announced transformation of its crude oil refinery into an import terminal, planned by Petroineos — a joint venture between Ineos and PetroChina — to take place no earlier than spring 2025.
While Petroineos is considering prospects for a biorefinery at the site, it has warned of a “commercially suboptimal” UK policy environment as a roadblock. Specifically, plans by the UK to restrict use of hydroprocessed esters and fatty acids (HEFA) feedstock, derived from waste and vegetable oils, for sustainable aviation fuel production has been flagged as a barrier to potential development plans.
Timelines for the oil refinery’s transformation are yet to be specified, but Petroineos said earlier that operating beyond May 2025 would require a £40 million investment.
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