A MULTI-NATIONAL company behind plans to bring fracking to Scotland has been awarded over £16 million by the country’s jobs quango in the last eight years.
The sums given to Ineos – the equivalent of nearly £180,000 a month – have sparked concerns that the Government has invested too much in the company to reject fracking entirely.
Ineos, which was founded by billionaire tycoon Jim Ratcliffe, acquired the sprawling oil refinery and petrochemical plant at Grangemouth in 2005.
The facility employs around 1,300 people and is estimated to contribute to nearly four per cent of Scotland’s GDP.
However, a 60 per cent decline in gas production from the North Sea saw the company decide to source ethane from outside the UK as part of an attempt to modernise its business.
Ineos also wants to be the driver in establishing a homegrown fracking industry in Scotland – the controversial process that involves drilling into the earth onshore in an attempt to release shale gas.
The SNP Government slapped a moratorium on fracking amid public and environmental concerns and commissioned research into the practice.
Ministers will consult further on the evidence gathered and intend to make a decision on fracking by the end of the year.
According to figures obtained by this newspaper, the public investment in Ineos Chemicals Grangemouth Limited – a company subsidiary – has been vast.
In 2009, Ineos was awarded £7.6m by Scottish Enterprise as part of the KG Flex project that is said to have secured jobs at the plant. The sum has been handed over in full.
In 2013/14, the jobs quango awarded the same company £9m to help establish a processing capacity to handle and deliver imported ethane from the US. The grant is handed over in instalments.
When the shipments from the US arrived at the new ethane facility, Friends of the Earth Scotland campaigns chief Mary Church said: "The fact that Scottish public money is tied up in this project is disgraceful. Setting aside the devastating local impacts of fracking, the climate consequences of extracting yet more fossil fuels are utterly disastrous."
Mark Ruskell, a Scottish Greens MSP, has now expressed concern at the level of Government support for Ineos: “On any given day, we might hear the SNP talk about the Scottish Government’s ‘world-leading’ climate change targets, the next it might be boasting of its plans to cosy up to the airlines by giving the aviation industry a tax cut. And the revelations of this investment further shows the Scottish Government is all over the place when it comes to its environmental policies."
He added: “The Government really has some explaining to do, because people will want to know how meeting our climate change targets are possible while investing so much money in this fossil fuel giant. They’ll also be asking if a fracking ban is ever possible with the SNP Government, given Scottish Enterprise has made such a big investment in Ineos, a company intent on digging up Scotland.”
However, a spokesman for Ineos hit back and said the investment had saved the plant: “Ineos has invested £450m in the site to enable a new secure-source ethane gas to be found, to build the new import terminal and to support site losses until the gas, which is an essential raw material, arrived from the US. Without this investment and support from the Scottish Government the site would have been uneconomic and would have closed."
A spokesperson for Scottish Enterprise said: “Ineos’ operation at Grangemouth is of strategic importance to Scotland’s economy. Petrochemicals, which are produced by Ineos at the site, are one of Scotland’s top five exports.
“The £16.6m investment made by Scottish Enterprise helped to generate £185m of investment from the company.”
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