TALKS aimed at averting a two-day strike by workers at the giant Grangemouth oil refinery broke down last night, forcing the likely closure of the plant.
The stoppage by up to 1,200 workers at the petrochemical complex on the Forth will now go ahead on Sunday and Monday, threatening fuel supplies to Scotland and the north of England.
Officials from the Unite union had been meeting with bosses
from Ineos, which owns the Grangemouth refinery, at the headquarters of the conciliation service Acas in London for the past two days.
But the union announced last night that the talks had failed to find a breakthrough in a dispute over pensions.
The strike has been called in protest at plans by Ineos to modify its final salary pension scheme, including closing it to new workers and seeking contributions from existing members of the scheme.
A spokesman for the union said: "Unite's negotiators were disappointed with the company's refusal to withdraw controversial pension plans and, therefore, the two-day strike will go ahead."
A statement from Acas said that although the two sides had not come to an agreement, time had been spent addressing the issue of safety and the integrity of the Grangemouth complex during the strike. "An agreement covering these issues has been reached for the period of the dispute," it said.
Ineos had already started shutting down Grangemouth, the largest refinery in Scotland, and had already warned of fuel shortages from later this week if the strike went ahead.
The firm said it now had no option but to completely shut down the site on Saturday evening to make sure it was safe during the strike.
The company accused Unite of rejecting proposals to resolve the dispute. Ineos said it had put forward "significant" new proposals during the talks at Acas.
The company said it had offered to take all the changes to the pension scheme off the table and make them the subject of a three-month discussion so that the strike threat would be removed, although future new employees would be removed from the scheme.
Tom Crotty, chief executive of Ineos, said: "We have done everything we can to resolve this dispute. The plain fact is that the union seems hell-bent on pursuing a strike that will cause chaos and disruption for the people of Scotland and across the UK."
The AA, Britain's largest motoring organisation, said motorists should not panic. Paul Watters, the AA's head of public affairs, said: "I don't suppose this news has come as a massive surprise as it has been quite a public airing of the issues and the positions of both sides were quite strong in terms of taking a hard line. There still is no reason for people to panic. We have to put our trust in the petroleum industry to keep Scotland's pumps filled.
"They have said they can do that and the proof of the pudding will play out over the next week or so."
Mr Watters added that England had coped with fuel shortages after the fire at the Coryton refinery in Essex and the explosion at Buncefield.
"What motorists don't need to do is to keep their tanks full," he said. "They should keep filling the normal amount."
NO REASON TO PANIC, SAY OIL CHIEFSTHE UK Petroleum Industry Association, which represents oil giants such as BP, Shell and the UK operations of international firms, said yesterday stocks at Grangemouth were enough to supply Scotland through the two-day stoppage.
Chris Hunt, the association's director-general, said: "Cargoes of product are being sourced to satisfy demand during the period the refinery is coming back on stream. There have been temporary stock-outs caused by panic-buying, but service stations will be replenished as soon as possible."
He also said production at Grangemouth had "no effect" on internationally traded oil.
Mr Hunt said: "Grangemouth is a UK refinery processing crude oil into finished petroleum products; it therefore has no effect on internationally traded crude oil, which ultimately forms the basis of prices at the pumps."
