ExxonMobil to close Scottish chemicals plant with loss of 200 jobs

ExxonMobil plans to close a chemicals plant in Scotland and lay off 200 workers, citing difficult market conditions and a policy environment in the UK it claims is “accelerating the exit of vital industries”.

The company said it had been unsuccessful in attempts to find a buyer for the Mossmorran plant, which is situated near Cowdenbeath in Fife and has been a significant employer in the area for 40 years. A further 250 contractors working for other companies at the facility, which produces chemical feedstocks used to make plastics, will be affected by the closure.

“We plan to shut down our Fife Ethylene Plant in February 2026, subject to a full employee consultation,” Exxon said in a statement.

“We considered various options to continue production and tested the market for a potential buyer, but the UK’s current economic and policy environment combined with market conditions, high supply costs and plant efficiency do not create a competitive future for the site.”

Melanie Ward, MP for Cowdenbeath and Kirkcaldy, described the closure as “devastating”, with workers told they would lose their jobs without an idea of their redundancy packages.

Scotland’s deputy first minister, Kate Forbes, said she was disappointed with ExxonMobil’s “commercial” decision. The Scottish government would set up a task force to assess how it could mitigate the impact, but she said Holyrood had “limited economic powers”.

“UK ministers must consider what more they can do for the workers at the plant and take urgent action to address the high cost of energy,” Forbes said. The UK government said it had explored “every reasonable avenue” to support the site, and that the US company had “significant global challenges”.

Bob MacGregor, industrial officer at the Unite union called the decision “devastating for the workers at the plant and the local community”.

“ExxonMobil is one of the richest companies in the world. It cannot be allowed to walk away and leave an industrial wasteland in Fife.”

The closure highlights the challenges for the UK petrochemical industry, which faces fierce competition from rivals in China and elsewhere flooding global markets with cheap imports.

The oil and gas sector is also losing jobs as production in the North Sea declines — a trend lobbyists said was exacerbated by the government’s decision to increase windfall taxes on producers.

Exxon approached the UK government to explore whether it could obtain support to improve the viability of the Fife plant. Discussions were constructive but unsuccessful, according to a person with knowledge of the talks.

One concern highlighted by the UK petrochemicals industry is the omission of refineries and chemical plants from the government’s planned carbon border adjustment mechanism, which is due to come into force in January 2027.

Under the proposed scheme, importers of certain goods such as cement, fertiliser and aluminium, will pay an equivalent cost for the carbon emissions associated with production.

However, importers of ethylene into the UK will not, at least initially, have to make these payments, leaving domestic producers such as Exxon’s Fife plant in a less competitive position, according to an industry source.

Last month Paul Greenwood, Exxon’s UK chair, told a parliamentary hearing there was “an absolute catastrophe waiting to happen” in the UK’s refinery industry, if carbon costs continued increasing for domestic producers but not for overseas competitors.

In April, the Grangemouth oil refinery in Scotland ceased operations after a century of production. In July, UK energy minister Michael Shanks announced the Lindsey refinery in England would close as no buyers had been found after its owner, Prax Group, went into administration.

Exxon said: “Fife Ethylene Plant has been a cornerstone of chemical production in the UK for 40 years, and its closure reflects the challenges of operating in a policy environment that is accelerating the exit of vital industries, domestic manufacturing and the high-value jobs they provide.”

Exxon will remain an investor in the UK, where it owns the Fawley refinery in southern England, a fuel distribution and terminals network, service stations and interests in North Sea oil and gasfields.

The decision to close the Fife plant is not expected to affect Exxon’s ability to provide ethylene to its manufacturing facilities in Belgium.

Letter in response to this report:
Verbal inconsistency / From David Brindle, London N2, UK