Major British oil pipeline being shut down ahead of possible strike
Amy Judd | April 26, 2008 at 03:52 pmby
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The Grangemouth refinery in Scotland employs around 1,200 workers that are due to walk out at 6am tomorrow if a deal is not reached.
The Grangemouth refinery in Scotland produces a tenth of Britain’s petrol and diesel but also has a power station that supplies the neighbouring Kinneil plant that processes the crude oil coming ashore from 70 fields in the North Sea.
Without that power Kinneil cannot operate. In preparation, several of the North Sea fields have begun to cease production.
“We have been told we will receive power until the strike starts, so we will begin ramping down the pipeline system overnight and by 6am it will be completely shut down,” a spokeswoman for operator BP said.
The strike is the first to close a British refinery in over 70 years.
The Forties pipeline carries an average of 700,000 barrels per day (bpd), close to half the 1.5mn barrels the country produces daily. A fifth of Britain’s gas supply also relies on the Forties system.
The Forties oil alone is worth £50mn ($100mn) a day and the pipeline’s closure for the two-day strike will make a significant dent in already stretched government coffers, which rely on hefty tax revenues.
Management at the 200,000 bpd Grangemouth refinery, owned by international chemical company Ineos, met officials of the UNITE union on Saturday but failed to get a deal that would allow the pipeline to continue operating.
“We will provide full safety cover over the two days so the refinery can be fired up quickly after the strike but the Kinneil plant will not be treated any differently from any other facility on the site,” a union spokesman said after the meeting. He said no further meetings were planned with management.
Yesterday, industry lobby group Oil & Gas UK urged the government to intervene to make sure North Sea oil kept flowing.
“It is now time for the UK Government at the highest level to step in and take all the necessary actions to ensure that the country is not held to ransom in this manner,” said chief executive Malcolm Webb.
“This is now affecting some 80 companies and their operations which are in no way connected to or involved in this dispute. The impact ... goes way beyond Ineos and UNITE’s immediate differences and is wholly disproportionate,” he added.
The government says there will be no overall shortages of fuel but accepts that there may be some local supply problems, particularly in Scotland and northern England.
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