UK Government Invests £120m to Save UK's Last Ethylene Plant at Grangemouth
The UK government has announced a £120 million grant to save the nation's last ethylene plant located at Grangemouth, with an additional £30 million investment from chemical firm Ineos. This move aims to safeguard more than 500 jobs critical to the production of ethylene, a vital component used in medical-grade plastics, water treatment, aerospace, and automotive industries.
The deal will be officially unveiled at Grangemouth on 17 December 2025 by Chancellor Rachel Reeves and Business Secretary Peter Kyle. The government emphasized that this funding package preserves essential industrial capability and enhances national resilience.
The intervention comes amid a challenging context for Grangemouth, following previous job losses after the closure of Ineos's oil refinery operations and ExxonMobil’s recent announcement to close its Fife ethylene plant in February, which will result in the loss of 429 jobs. The government has faced criticism over its delayed response to these challenges.
Alongside this main package, two further projects at Grangemouth have been announced, receiving nearly £10 million in funding. These projects, run by MiAlgae and Celtic Renewables, focus on low-carbon green chemical production, expected to create up to 310 jobs by 2030. MiAlgae will produce omega-3 from whisky byproducts, while Celtic Renewables will manufacture acetone, butanol, and ethanol from whisky and agricultural waste.
Ineos continues to face cost pressures due to high gas prices and plans additional job cuts including around 60 at Hull, hundreds at Ineos Automotive, and a fifth of jobs at its East Yorkshire chemicals plant after closures in Germany. The company is also pursuing anti-dumping actions to combat cheap imports.
This comprehensive funding and development plan is seen as a critical step for maintaining the UK's chemical manufacturing base and securing industrial jobs in the region.
