500 Jobs Secured at Grangemouth as UK Government and INEOS Strike £150m Deal
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The UK Government has partnered with INEOS to secure the future of the Grangemouth petrochemical plant, safeguarding 500 jobs at the site and hundreds more across the regional supply chain.
Under a landmark £150 million joint investment, the Government will provide more than £120 million in support, alongside significant private investment from INEOS. The agreement ensures continued operation of Britain’s last remaining ethylene plant, a facility regarded as strategically critical to the UK’s national infrastructure, energy security, manufacturing base and North Sea operations.
The deal includes a long-term operational commitment from INEOS and safeguards to protect public funds, with strict conditions ensuring the investment is used to improve the site. The Government will also retain the right to share in future profits.
A strategically vital site
Grangemouth plays a central role in the UK economy, producing ethylene used in medical-grade plastics and across the wider chemicals supply chain. These materials are essential to sectors such as advanced manufacturing, automotive and aerospace, where plastics are embedded in nearly every product.
The site is also connected to the Forties Pipeline System, a key route for transporting North Sea oil and gas onshore. Without intervention, closure of the plant would have placed hundreds of direct jobs at risk, affected thousands more regionally, and severely disrupted critical supply chains.
The investment package will support improvements in energy efficiency, productivity and carbon reduction, helping secure the plant’s long-term competitiveness and sustainability. INEOS has already invested more than £100 million over the past year to maintain operations at Grangemouth.
Part of a modern Industrial Strategy
The intervention forms part of the UK Government’s Modern Industrial Strategy, which identifies chemicals as a foundational sector underpinning high-growth industries such as defence and advanced manufacturing.
The Government is supporting the sector through measures to reduce energy costs, including the British Industrial Supercharger and the forthcoming British Industrial Competitiveness Scheme. Together, these initiatives are expected to cut electricity costs for eligible energy-intensive businesses by up to 25%.
Business Secretary Peter Kyle formally announced the support during a visit to the Grangemouth site on 17 December, alongside the Chancellor and the Secretary of State for Scotland.
Government and industry reaction
Prime Minister Keir Starmer said the deal demonstrated the Government’s commitment to protecting jobs and investing in Britain’s industrial future:
“When we said we’d protect jobs and invest in Britain’s future, we meant it. This is about good jobs, stronger communities and a modern economy that works for everyone.”
Business Secretary Peter Kyle said the partnership would secure Grangemouth’s future as a site of national importance:
“By partnering with INEOS, we are giving certainty to workers and the supply chain, while backing manufacturing in the UK through our Modern Industrial Strategy.”
Chancellor Rachel Reeves said the investment would strengthen national resilience and protect livelihoods:
“This vital package secures the future of Grangemouth and the hundreds of people employed at the site for years to come.”
Scottish Secretary Douglas Alexander described the funding as a landmark moment for Scotland’s industrial future, protecting not only jobs at the plant but thousands more across Scottish supply chains.
INEOS CEO Sir Jim Ratcliffe welcomed the partnership, stating that the investment demonstrated a shared commitment to British manufacturing and to delivering competitive, low-carbon industrial operations in the UK.
Wider investment and support
The agreement also aligns with the Government’s longer-term vision for Grangemouth, including up to £200 million of potential investment from the National Wealth Fund to support new industrial opportunities at the site. Around 140 project enquiries are already under consideration.
Alongside this, recent government backing has supported the MiAlgae project at Grangemouth, expected to create around 130 direct jobs over five years, while a joint taskforce has been established to support workers affected by the upcoming closure of the Mossmorran plant.
The Grangemouth Training Guarantee will also be expanded to workers providing shared services to the refinery, helping ensure continued access to skills development and employment opportunities across the local community.
Together, these measures underline the Government’s commitment to protecting strategic industry, supporting Scottish workers and securing the long-term future of Grangemouth as a cornerstone of the UK’s industrial economy.
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