UK Government to Bail Out Grangemouth Chemical Plant Amid Sector Crisis
On 17 December 2025, the UK government announced a bailout of more than £120 million for the Grangemouth chemical plant, according to the Department for Business and Trade. Grangemouth plays a central role in the UK ethylene pipeline, linking plants in Cheshire and Teesside and serving as a critical node in the network. The plant faced potential closure by INEOS, which would have left Grangemouth as the last major plant in the network following the closures of Wilton (Sabic) and Mossmorran (ExxonMobil).
The bailout aims to protect around 500 direct jobs at Grangemouth, with the potential broader sector impact threatening over 1,000 jobs. However, there are two distinct problems highlighted: the government's approach is considered reactive rather than strategic, and the bailout is unlikely to prevent the ongoing sector-wide crisis.
The UK's chemicals sector output has decreased by more than 20% over the past three years, with high energy costs and regulatory challenges cited as primary causes. This crisis mirrors difficulties seen across Europe. Additionally, the Grangemouth refinery now imports ethane from the United States instead of North Sea oil and gas.
This government support follows previous interventions involving taxpayer money to support British Steel and Tata Steel at Port Talbot, along with loan guarantees provided to Jaguar Land Rover after a cyber attack.
