BP scraps multi-million pound power plant at Grangemouth
The new gas-fired combined heat and power plant could have created 400 jobs.
A multi-million pound plan for a new power plant at Grangemouth has been scrapped by oil giant BP.
The firm had announced its intention to build a gas-fired combined heat and power (CHP) plant at the Kinneil terminal, which would have generate steam for the oil industry as well as electricity.
Construction of the plant would lead to around 400 temporary jobs being created, it was reported at the time.
Scottish ministers granted planning consent for the project in March last year.
BP has now said it will no longer invest in the CHP site, citing an ongoing review amid a "challenging business environment."
It has reached a deal with Ineos, the firm which operates the refinery at Grangemouth, to provide Kinneil with power and steam.
BP currently provides gas products to Ineos from its Kinneil site.
A BP spokesman said: "In a challenging business environment, BP continues to review how our finite capital investment funds can be most effectively and efficiently be spent.
"As part of this review, we have looked again at the requirement to invest in a CHP plant at Kinneil.
"Discussions have taken place with Ineos, the operator of the Grangemouth refinery and petrochemicals plant, who currently buy our gas products and provide the Kinneil site with power and steam."
He continued: "We have now reached an agreement in principle for Ineos to continue to purchase dry gas and liquefied petroleum gases from us, and for them to provide Kinneil with power and steam.
"This renegotiated agreement will mean the substantial investment required for a new Kinneil CHP plant will now not be required.
"We believe this decision is in the best interests of the Forties Pipeline System business as we continue to address the ongoing challenges and cost pressures facing the industry."