The chairman of INEOS today stressed that China would not be raiding the UK’s oil reserves for its own purposes following yesterday’s Grangemouth refinery deal.
Grangemouth, which is owned by INEOS, has entered into a partnership with PetroChina, the largest energy company in China and, by stock market value, the biggest company in the world.
The signing of the joint venture was witnessed by Deputy Prime Minister Nick Clegg and his Chinese counterpart Li Ke Qiang.
This morning, Mr Crotty was asked what was to stop Chinese tankers queuing up at Grangemouth to load oil and take it back to China and, in turn, threaten the security of the UK’s oil supply.
“On the contrary, I think this is a great way of affirming the security supply of the UK,” he told Radio 4, “because you’ve now got one of the world’s largest energy companies investing within that key infrastructure.
“They don’t need [oil] for their own needs. If they did, they would be building their own refineries. This is about building a strategic long-term business.”
Grangemouth is located on the Firth of Forth with direct access to crude oil and gas from the North Sea. Grangemouth processes around 210,000 barrels of crude oil per day and provides fuel to Scotland, northern England and Northern Ireland.
The PetroChina deal involves not just Grangemouth, but also the INEOS-owned Lavéra refinery in France, next to the port of Marseille, which supplies fuel by pipelines into France, Switzerland and southern Germany.
Calum MacLean, INEOS Refining chief executive, yesterday said: “These agreements will help secure the long-term future of jobs and skills at Grangemouth and Lavéra, in partnership with one of the world’s largest energy companies.”
Si Bingjun, general manager of PetroChina International London, added: “The proposal is consistent with our strategy of building a broader business platform in Europe and of becoming a leading international energy company.”
The deal has been praised by Scottish Finance Secretary John Swinney.
“The Grangemouth refinery is a strategic asset for Scotland and this announcement represents good news for Scotland and Scottish jobs,” he said. “This joint venture enhances security of supply for customers and retains the jobs and skills that have been built up over many years at Grangemouth. It further embeds the successful relationship and excellent links that INEOS has with the local and Scottish communities.
The INEOS contract is one of several inked during Vice-Premier Li’s whistle-stop visit to the UK this week. In all, British and Chinese companies signed deals worth about £2.6bn this week.