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Exxon to shut down Scottish chemicals plant by 2026 amid uncertainty

Exxon to shut down Scottish chemicals plant by 2026 amid uncertainty
Exxon to shut down Scottish chemicals plant by 2026 amid uncertainty

Exxon Mobil announced Tuesday that it will close its Fife Ethylene Plant (FEP) located in Scotland by February 2026. The company said the plant is no longer viable due to high supply costs, weak markets and the UK’s economic and political environment.

The European Union's fourth largest exporting sector, after machinery, automobiles and pharmaceuticals has been under pressure due to soaring energy prices following Russia's invasion in Ukraine, and an aging infrastructure. This has led them to become more dependent on imports for key feedstocks like ethylene and propylene.

Exxon said that the closure would affect 179 employees and 250 contractors. However, 50 employees could be transferred to the Fawley Petrochemical Complex.

Exxon said it had evaluated various options for continuing production and tested the markets for a possible buyer for the ethylene facility located near the town Cowdenbeath, in Fife.

The company stated that "FEP was a cornerstone in chemical production in Britain for over 40 years. Its closure reflects the challenges in operating in an environment where policies are accelerating the departure of vital industries and domestic manufacturing and the high-valued jobs they provide."

The shutdown comes as a result of the falling capacity for oil refining in Europe, where companies are looking to convert or close assets.

Michael Shanks, the Energy Minister, said that Britain's Lindsey refinery was insolvent and would close down after it failed to find buyers. (Reporting and editing by Shilpa Majumdar in Bengaluru. Pooja Menon is based in Bengaluru.

(source: Reuters)