Ineos go all in, Unite fold

The best analogy of the deal that was reached over the Grangemouth plants future this morning comes from the world of poker.

Ineos possibly sick of the infighting and continuous threat of strikes from the Unite Union yesterday announced they were shutting down the petrochemical part of the plant and considering the future of refinery. It was the equivalent of putting all your chips unto the table and being prepared to lose everything.

Unite had rejected the 'last chance survival' plan offered by Ineos, but this morning with 800 jobs apparently already gone and 570 others threatened they capitulated. Accepted all the conditions laid down by that plan as they say "warts and all". Equivalent to throwing all your cards away in poker.

This afternoon we also saw the new Secretary of State for Scotland Alistair Carmichael and Scottish Finance Minister John Swinney together in Grangemouth to talk with Ineos this afternoon.

Addressing the press after that meeting Mr Carmichael said:

"We are in a much better place today in relation to the future of the plant than we were yesterday.

"There remains, of course, a great deal to be done."

Mr Swinney added:

"This plant has got a great future, everybody accepts that Grangemouth has got a great future.

"What we need to do is resolve these outstanding issues, get the investment plan implemented and take forward and improve the prospects for the people that that work in this plant."

The past 24 hours has certainly proved to be a long time in the  life of 1,370 highly skilled jobs in Grangemouth and I hope that in the future both sides will sit down and discuss differences in a constructive and respectful manner long, coming to a conclusion long before it escalates to such potentially damaging circumstances.

The wider impact of the loss of Grangemouth peterochemical jobs

Around 800 people across West Lothian and Falkirk are to lose their jobs with the announcement today that Ineos are to shut down the Grangemouth petrochemical plant with immediate effect. The fate of the remaining 570 jobs linked to the refinery on the same site are yet to be determined.

It is one of the biggest loss of jobs in the area following on the the 3,100 lost with the shutting of the Motorola plant at Bathgate in 2001, the same number lost their jobs at NEC, Livingston the same year. More recently 500 lost their jobs with the shutting down of the Bausch and Lomb plant at Livingston.

But the danger of losing jobs in the petrochemical plant is nothing new. Indeed back in May 1992 my some time sparring partner the MP for Linlithgow and East Falkirk mentioned then recent job losses at the plant in his maiden speech:

"The town of Grangemouth is at the centre of Falkirk, East and has been noted for some time as a petrochemical town, boasting substantial production facilities for BP Oil, BP Chemicals, ICI, General-Electric Plastics, and Rhom and Haas (Scotland). My constituents are pleased at the commitment to investment by those companies, notably the £600 million investment by BP Chemicals in an ethylene cracker plant, the process technology labs of ICI and the Rhom and Haas plant upgrade. However, all is not what it once was. Harry Ewing noted the vast expansion of Grangemouth in 1971, but in 1971, when speaking about new employment, he said that the position was rapidly changing. I say without criticism of local management in Grangemouth that, in 1991–92, more than 1,000 job losses were announced in the town. Some 300 jobs have gone at the BP refinery, 250 have gone at ICI and 200 more redundancies are being sought. In addition, there were major job losses in the timber yards, which were made much of in 1971 by my predecessor."

It is sad day for the 800 who have lost their jobs today. However, both sides have been acting like stubborn mules in recent days, if not years. The owners seem to be doing all they can to get what they view as a white elephant off their books, while at the same time the workers are not prepared to take any chance in pay and conditions, fearing their own job without considering that all the jobs in the sector could be gone.

When Ineos came with what they called a survival plan, you would have thought that alarm bells would have been ringing with the workers. The fact that the plant has survived so long without a major change in conditions when others the area have had to accept such adjustments, knowing that if they didn't their job could disappear.

But the Grangemouth plants is almost a fifedom of Unite. The same union that has been at the centre of the Fallkirk Labour Party's election shenanigans. The Union appears to have been promising the workers take a stand and we'll see that everything will be alright, only to have found that Ineos were also not going to budge. it appears that the 570 jobs in the refinery are now also in danger. But with that there is also other jobs in the oil industry and possibly the ability of Scotland to actually process the oil that lies off its shore.

The last element is going to be of extremely great concern to Alex Salmond because part of the way he was going to fund an independent Scotland was through the production and processing off 'Scottish' oil within Scotland. If the Grangemouth plant were to totally close and be mothballed or decommissioned it could take years if at all to be able to get the processing of oil within Scotland up to the speed that would make it capable of supporting Scotland's economy to the extent that Salmond wants it to. If the oil is going to have to be processes and refined elsewhere that would be extra costs and less value added within Scotland causing a rather big hole in his economic plan.

When the Nationalists don't follow Norway's Example

I'm not saying I'm an oil expert, although I do have a degree in Economics that can help me understand both the macroeconomic and microeconomic consequences of actions. But Ian Taylor is a man who understands the oil industry. He is Chief Executive of oil and gas trader Vitol Plc.

One of the things we hear about from the Nationalissts is that post-independence the oil revenue will allow an independent Scotland to build up an oil fund like the one that Norway has been stockpiling for the last 30 plus years. Indeed Norway is often used as an example by the SNP as to how their model of Scotland will work.

However, as Taylor points out in today's Sunday Herald there is one place that the Nationalists are not following Norway and that is forecasting oil prices.

"Norway, so often held up as an example, are planning on an oil price of $77 a barrel in 2014 compared to the SNP's 'cautious' estimate of $113. Make no mistake – such over-optimistic assumptions would come at a real cost.

"The cash gap between peak and trough of oil revenues in the last decade is equivalent to the entire budget of the NHS in Scotland. I ask everyone reading this to consider one question. What if the Nationalists' optimistic projections are simply wrong?"

That is some gap! That is some hole in the budget for an independent Scottish economy that wants to base itself so dependently on oil revenue. That is something that doesn't need a degree in economics to tell you is going to be disasterous.

Patrick Harvie calls Alex Salmond on his green credentials

At the start of last weeks Scottish National Party conference last weekend First Minister Alex Salmond said:

"We [Scotland] are leading the global revolution in clean, green renewable energy, and we can and should be at the cutting-edge of pioneering carbon capture technology."

This week however, co-convenor of the Scottish Greens Patrick Harvie asked just how green can Alex and his SNP be? In his speech he said:

"Alex Salmond now has a very clear and simple choice - he must either fail on Scotland's much-vaunted climate change targets, or he must drop his unconditional support for the fossil fuel industries. 

"First, the new coal-fired power station at Hunterston must be blocked. Then he must rule out shale gas extraction, which his energy minister has refused to do. 

"Then, because CCS [carbon capture and storage] can never be applied to most uses of oil anyway, he must drop his support for dangerous deepwater oil drilling in Scottish waters."

The SNP are of constantly on about how they are not benefiting enough from the North Sea oil and gas industry. "Black gold" is the jewel in their crown for their being able to finance their dream of an independent Scotland. There has never been any secrecy about that not from the 70s the whole way through to the present day you will hear some SNP elected representative or candidate harp on about it being Scotland's Oil. Yet they continue simultaneously as Patrick has pointed out to try and balance appearing green with energy while looking to extract as much money as possible from fossil fuels.

So Patrick is right to ask what is it to be Alex? Oil, gas and shale or renewables?

How Green is Your Salmond?

While I'm more that glad to hear Alex Salmond say that Scotland should be fully supplied by renewable energy by 2025. But it flies in the face of his demands just last month to benefit from the £242bn of tax revenue from the North Sea over the next 30 years, by devolving that tax raising power.

You see it is all well and good wanting to be 100% renewable in fifteen years Mr Salmond, but you are looking at benefiting from a carbon-burning economy for twice that length of time. The problem is of course that since the 1970s part of the SNP cry for Independence is that it is Scotland's oil. The revenue from that oil will fund their independent Scotland. Therefore the SNP are not the green party they are making out to be.

The Liberal Democrats had set target of 2050 for 100% renewables in our last Scottish election manifesto, a figure that we also pledged across the UK in our 2010 manifesto. It was a target we had set with intermediary steps along the way as part of a detailed roadmap to getting there. The pledge from Salmond today cuts 62.5% further off what other parties have said is even an ambitious target, ironically even the Greens only talk about a low-carbon Scotland on their website and have no aim for 100% renewables.

I have to ask myself has Salmond enquired what figures the other parties have and then decided to halve the most ambitious (although through bad maths that should have been 2030)? He has also increase the 2020 target from 50% to 80%. I've yet to see a breakdown of his objectives, conversion and payment plan to achieve this. Figure indicate that renewable energy in Scotland contributed 22% of the total in 2008 (up from 20.2% the year before) with an interim target of 31% for next year.

These are aggressive targets but I'm wondering are they attainable of are these just a promise ready for next May, like the many promises that the SNP have already failed to keep from May 2007?

It's Friday...so BP and World Cup

It's been a while since I did one of these but a few links have really got me in the mood.

First this one taking a sideways glance at the BP situation in the Gulf of Mexico.



Obviously I'm shocked by the environmental disaster that is unfolding, it really conflicts with my green credentials. Speaking of Green.



On the theme of the World Cup of course the story is the fellowship of the people playing those little plastic horns, aka Vuvuzeala's. They may sound like a hornets nest, maybe that is what they are.

Not for Wool, or Fish, but for Oil, Latin America Stands Together

The last time the Union of the Provinces of the River Plate actually governed the Islas Malvinas was from 1820-1833, but they only installed a Governor for the Islands in 1829. Twenty eight years ago there was an long diplomatic negotiation which had been going on before on the 2 April the Argentine army invaded.

Therefore the fact that Hugo Chávez the Venuzuelan President and other Latin American leaders have back Argentina and are heading to the UN is a throw back to the 70s and early 80s. Chávez and Cristina Fernández de Kirchner the Argentine President wouldn't have been a main concern to the UK Citizens on the Falklands but when Brazil and Chile are also backing calls for a return of sovereignty. The fact is that in 1820 the Islands only became of interest to some men of the Union of the Provinces due to a French wreck on the shores. Even those early claimants were aware of a conflicting claim of Britain to the islands, whose garrison had departed in 1776 because of the American War of Independence.

Of course we long expected that more wars over oil and then war could erupt. Most people thought these would centre on the Middle East or Central Asia. Now it appears that the South Atlantic has come into play. One of the lest fought over units on a Risk board but an area of many incursions from Argentina over recent history.

Almost 30 years ago it was just a case of Argentina against the UK, although some other nations provided logistical support. This time it appears that the whole continent has reared it heads. Mind you last time it was mainly about sheep and the self determination of the people who shepherded those sheep, this time there is the inclusion of oil into the equation.

In 1983 the people of the Falklands were granted full British citizenship, though in 1989 there was a UN resolution passed for the two nations to discuss the sovereignty of the islands, though despite diplomatic relations being restored such talks have never taken place.

What a Difference a Day Makes

Yesterday morning it was revealed that Gordon Brown had vetoed attempts to force Libya to make compensation to IRA victims of Libyan supplied Semtex. Yesterday evening in Berlin he said:

"I desperately care about the impact of all IRA atrocities on the victims, their families and communities.

"The Libyans have refused to accept a treaty or normal intergovernmental agreement on this issue.

"As a result, our judgement has been that the course more likely to bring results is to support the families and their lawyers in their legal representations to the Libyan authorities.

"We will appoint dedicated officers in the Foreign Office and our Embassy in Tripoli who will accompany the campaign group to meetings with the Libyan government to negotiate compensation, the first of which will be in the next few weeks."

It was greeted by opposition MPs as a U-Turn. William Hague the shadow Foreign Secretary said:

"The Prime Minister's announcement is a stunning admission that the Government has failed to support the families of the victims of IRA terrorism in their pursuit of compensation from Libya. This U-turn comes only after today’s reports that Gordon Brown was personally involved in a decision not to engage Libya on this issue. The British Government should have provided active support as a matter of course, not as a result of public pressure. But Gordon Brown and the Government he leads have long lost their moral compass."

Jeffrey Donaldson of the DUP added:

"We have forced a U-turn, it's not every day you can say that.

"We will work with his government to put the case to the Libyans.

"It is essential now that the government delivers what the Prime Minister has promised."

And the Lib Dem Foreign Affairs Spokesman Ed Davey said:

"We have got a prime minister who no longer appears to be in control. The government looks pretty weak."

Lawyers representing the victims of 138 families had already approached Mr Brown about the possibility of Government assistance in taking their claims forward to be told that it would have been "inappropriate". Yesterday after a fair bit of international* as well as national scrutiny the Prime Minister promised a "dedicated" team of officials at his press conference prior to meeting the German Chancellor Angela Merkel.

In what would appear to be a volte-face brought about at the end of a hard two weeks of Libyan diplomacy stories leaking out to the press, the focus is slowly shifting unto just what has the British government been up to, if all this isn't about the oil deals already secured by BP and Shell, why is it only in reaction to being uncovered that the Prime Minister and his Ministers are prepared to come clean about the facts?

*This blog managed to attract worldwide attention and readers from 45 of the states in the US.

Oil Be There For You*

There are 2,500 families of the victims of the IRA's Libyan supplied Semtex.But the latest news over Westminster's 'special relationship' with Libya is that Gordon Brown vetoed attempts to force Libya to pay compensation as it would affect Trade Talks.

Lawyers for the victims are wanting the government to get a US-style scheme of compensation which has paid out $2.7 billion (£1.6 billion) to their 270 victims on Pan-Am flight 103. The latest revelation coming hot on the heels of Jack Straw's admission that oil deals with Libya were partially a factor in the talks about Megrahi. However, Gordon Brown in his silence breaking statement Wednesday appears to tell a different tale from his Justice Secretary when he said:

"On our part there was no conspiracy, no cover-up, no double dealing, no deal on oil, no attempt to influence Scottish ministers, no private assurances by me to Colonel Gaddafi

"As I told Colonel Gaddafi at the only meeting with him I have had, a decision on Megrahi was the sole responsibility of the Scottish Government. So when I met him I could not give him comfort or any assurance at all about [al-Megrahi's] fate."

Too much is unravelling, there is something going on behind the scenes that is trying not to look out for those UK citizens affected by Libya sponsored terrorism down the years. Just want stance is the Government taking with our seemingly new best friends (with oil)? There are mixed messages coming from Westminster which are making Iain Grey the leader in Scotland look more and more out of the loop and ridiculous as he attacks Kenny MacAskill. It also seems to be that questions need to be asked of Brown and Straw rather than finger wagging at the Scottish Justice Minister.

None of this affects my previous thoughts on the rightness of the decision at the time, although there does now appear to be even greater subterfuge into the points leading up to that. The unfairness of the treatment of the terrorists over the victims and their families, the deals that were going on behind the scenes. Just what does the Prime Minister et al know that has yet to come out.

*The title of course is a take on a title of the Rembrandts' song used in the title sequence of Friends.

Norway No Way for Scotland - Norway

The last unhindered bastion of Alex Salmond's arc of prosperity turned around and bite him yesterday. With the Emerald Tiger of Ireland stalled and Iceland floundering Jonas Gahr Støre, Norway's foreign minister, has said there are major differences between Norway and Scotland and the comparisons and plans made by Alex Salmond based on Norway's achievements do not add up.

For starters the oil fund that Salmond is so keen to replicate and use in so many ways in Norway is the pension fund. Its monies are "for our children and grandchildren" with very little available for current spending to the exchequer.

Also unlike in Scotland, "We [Norway] don't consume any of our gas, we export almost all of our production." The situation is reversed for the North Sea gas in the UK and Scotland, most of it is used domestically.

He also said there were major differences historically in how Norway and the UK were geared up to use the resources discovered in the North Sea in the 70s:

"Our social sector and structural system were ready for the big changes. We
started with major investments in oil and gas in the early 1970s and it was only
in the late 1990s that we went into surplus."

Finally the often almost robotic call of cybernats when challenged regarding Iceland or Norway has been the fact that both of these have escaped the vagrancies of various forms of some sort of greater Scandinavia through the centuries. Mr Støre however also said that he would be "upset" if he thought that his country were being used as a "source of division or strife in other countries".

Dear Prudence, Brown in Buck Passing Mode

Well as the Chancellor he once littered his budget speeches with prudence, or some other word derived from that stem is passing the buck regarding all things economic. However, as is the way of the Tim'rous Beatie as things are going wrong the Prime Minister instead of taking the plaudits once thrown at him for a stable economy, he's papering over the cracks as subsidence sets in, not even a year after his watch concludes.

Now while I accept that he does not have control really over international oil prices. He has had some control over food prices and as for UK house prices just who is the PM kidding by blaming international factors carte blanche.

Let's start with food. Yes for some time now our supermarkets have been underpaying suppliers to provide them with good which consumers are demanding all year round. Looking at the 'fresh' fruit and veg in February you'd think it was summer time if you had your own allotment or vegetable patch. Many of our European neighbours don't go in for this have it fresh have it now attitude and are more reliant on local in season produce, or pickled, frozen, tinned etc varieties when out of season.

Now by underpaying for what we eat, the producers have been unable to reinvest in their businesses to improve things, many have gone out of business. So yes while there is a food shortage in some areas of the world forcing prices for some commodities up, it is actually as much our responsibility in the first place as it now is our concern in our pockets. The fact that the keeping of prices artificially low has aided the chancellors inflationary targets for so long is possibly one reason why the government weren't too keen on fair trade, as fair trade wouldn't have made them look quite so good to the punter on the street.

As for the housing market problems. Surely the only problem our banks have had is in investing in something that overstretches. I remember learning all about discounting etc way back in early Economics classes at school. About how the banks had continued to lend more and more against a smaller and smaller proportion of anything substantial. Therefore the whole sub-prime fiasco is a disaster of the banks own making. The fact that many of our banks investing in companies offering that is a sign of their own greed, to try and make a quick buck.

The fact that 125% mortgages were available in the UK makes you wonder if it all goes wrong how on earth do you get back the extra 25%. Especially if the bubble finally bursts and house prices can no longer rise because people no longer can afford to pay to be able to borrow to pay those sorts of prices.

So just who was able to keep some sort of check on the financial sector in the last 11 years then Gordon?

Refinery Talks Break Down

The talks at Acas between the Unite union representing 1200 workers at the Grangemouth petrochemical plant and Ineos the owners broke down last night.

The dispute was over the removal the final pension scheme from new employees and to seek contribution from those already in the scheme. Now seeing the number of other employees across the country who have faced these sort of chances hardly the most radical pension changes in these hardening financial times.

However, Unite came away from the talks saying that Ineos had been unwilling to move over their proposals. Ineos on the other hand had said they were prepared to put all the changes on hold for a 3 month discussion period so that strike action and shutting down the plant can be avoided on Sunday and Monday. Sadly we cannot be sure which story is closest to the truth at present as to why after 2 days the talks broke down.

The Automobile Association and the UK Petroleum Industry Association have both said their is no need for Scottish motorists to panic buy full tanks of fuel as sources will be found to keep the pumps operating at normal levels of demand. For the period of the strike this was already available at Grangemouth and while the plant comes back on stream alternative sources to supplement local delivery. The temporary stock outs that have occurred across Scotland have come as a result of the panic paying.

Grangemouth, the Nats and the BBC

Yesterday I posted my feelings about the lack of comments from the Nationalist blogs regarding the impeding Grangemouth refinery strike and it affects across Scotland. So while talks resume today to try and resolve this issue I got to wondering just why do the Nats want to sweep this under the carpet.

To be totally fair there was one Nat, Malc in the Burgh, who approached the Grangemouth story at an amazing tangent and threw blame on all the hype on the way his licence fee was paying for "irresponsible reporting" from the BBC. This led to one rousing hoorah from fellow Nat leaning Jeff of SNP Tactical voting.

Well today there is an in depth look at just where the effects of impending shut down are being felt across Scotland on that same BBC. Of course I can only vouch for this around Bathgate as I witnessed last night in passing but Caron Lindsay has reporting similar things in Livingston, both backing up the BBC reporting.

Of course and independent Scotland might not replace the national broadcaster and rely wholely on private companies providing television so maybe the Nats are prepared to take swipes at something they have not planned on how to replace, instead of looking at an upset to their almighty oil based Scottish economy.

New Move to Avert Grangemouth Strike

As I blogged yesterday Unite had at unwilling to let the arbitration service ACAS get involved in their dispute with Ineos the owners of the Grangemouth oil refinery over their decision to end their final salary pension scheme.

However, with plants at the site already shutting down in preparation for the strike action Unite have agreed to talks in London with the employers at Acas's offices.

What is alarming however is the lack of response from the Cyber-Nats on this issue. Ideas of Civilation mentions it as did my fellow Lib Dems Iain Dale and Caron Lindsay. But nothing from the Nat or Labour leaning bloggers in Scotland. Obviously the Nats want to keep bad news firmly hidden under the carpet even if business is involved.

Grangemouth Shutting Down in Anticipation of Strike

When I posted last week about Falkirk Council seeking to reduce their carbon footprint. I don't think any of us anticipating that the biggest poluuter in the district might end up shutting down operations for a month.

A strike that the Union Unite is calling for the 27th and 28th April has already cause Ineos who run Grangemouth the only oil refinery in Scotland to start a phased shut down of units in anticipation of a full shut down by Friday and may result in disruption for up to a month as a result of safety concerns. As the Grangemouth facilty provides fuel to all of Scotland, Northern Ireland and a great deal of Northern England motorists have started to panic buy fuel. They are both concerned that fuel will be in short supply or that the price may go up even higher as a result of this action.

The dispute is over the removal of the final salary pensions scheme which Ineos say they will maintain for current members of the pension scheme. Unite apparently have not been prepared to involve the conciliation service ACAS in their dispute, which considering the disruption and panic their announcement would have been expected to cause seems rather unfair to the populace at large.