ExxonMobil chairman Paul Greenwood today said market challenges and government policy combined to make the Mossmorran ethylene plant unviable.
Addressing MPs in the Commons, he said £270 million had been invested in the plant over the last five years but it had lost £300m.
He praised the workforce for their efforts in helping to turn around the facility, but a combination of taxes, and a declining market meant it could not be made profitable.
Douglas Alexander, the Scotland Secretary, earlier said the Mossmorran plant had suffered from a lack of investment and the management could not provide a “pathway to profitability”.
“It was a very difficult approach from ExxonMobil,” he said. “The Mossmorran facility is now 40 years old, it was built to have a 20 year lifecycle.
“Alas, there hasn’t been the scale of investment that many of us would wished to see in Mossmorran over recent years”.
Mr Greenwood told the Scottish Affairs Committee: “The price of ethylene is extremely low and has been for a long time, so the market is fundamentally challenging.”
He explained that it was built in Fife to benefit from the North Sea basin. That is now mature and volume is declining. “The energy profits levy means the basin is less economic,” he said.
He added: “The feedstock we use is dwindling and more expensive”. He said the plant was now “burdened with higher energy costs.”
CO2 taxes cost the company £20m a year, rising to £40m by 2030. he said. “Our international competitors have no CO2 taxes which we bear that others do not.
“The market and government policy have undermined our ability to compete.”
Talks had taken place with ministers from several government departments but no financial support was forthcoming, he said. Options to import material was also considered but not considered financially viable.
He said that when all the factors, including operational costs and the market, were considered the only one in its favour was the skills of the workforce.
There had been discussions with bankers about selling the plant but “there was no one prepared to take on the site,” he said.
Earlier, Unite officer Bob MacGregor, said he wanted ExxonMobil to pause its closure plans to allow more talks with potential buyers.
He said that beyond “kind words and soundbites” there was little tangible evidence of support from either the Scottish or UK governments to save the plant.
Mr MacGregor was also scathing about the “just transition”. Having spoken to workers he said “no one is helping oil and gas. It is a myth, to be honest.”
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