Biodiesel Producing Plant in Newarthill Set to Close with over 70 Jobs at Risk

April 04, 2024

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by Michael Pringle (Daily Record) Argent Energy has already entered into a period of consultation with staff -- A plant producing biodiesel in Newarthill is set to close its doors with the loss of over 70 jobs. Argent Energy has already entered into a period of consultation with staff, with its future under threat.

Company bosses have cited “market conditions” as the main driving factor, according to a source at the plant near Motherwell.

Rumours started a few weeks ago that the company was closing the plant and fears were exacerbated when staff working there noticed members of the management team seeking alternative employment via social media.

The company claim market conditions have put severe economic pressures on biodiesel production facilities in the UK over the past two years have forced the move.

Argent Energy Group produces second-generation biodiesel made from waste fats and oils. The distilled product can be directly blended with conventional diesel and used as a fuel mainly for road transport.

The company has a plant at Stanlow in Cheshire with its headquarters in nearby Ellesmere Port. It boasts an annual production of 240,000 metric tonnes, which is used to power trucks and buses.

Established in 2001, production began in Newarthill in 2005 with 55,000 tons a year. A few years later they were supplying high bio blends to bus and truck companies. And in 2012 Transport for London first began trialling of Argent’s biodiesel for the city’s buses.

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The company is expanding its operations on the continent, planning to triple capacity, at the same time it is closing its Scottish plant. The Port of Amsterdam and Argent Energy are jointly investing €20 million in new dock facilities in the Hornhaven Amsterdam.

Argent Energy have cited a number of reasons for the closure, including competition from imported Chinese biodiesel which benefits from state economic support; an increase of imports of subsidised US-made product following removal of trade defence measures by the UK after Brexit; UK fuel suppliers being able to avoid the normal 6.5 per cent duty for imported biodiesel following approvals by HMRC; and the inability for the UK to import Argent’s main feedstock from the EU post-Brexit. READ MORE

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Argent plans to end biodiesel production at Scottish plant (Biofuels International)
Politicians highlight employees' concerns to management at closure-threatened Newarthill biodiesel plant (Daily Record)
Union pleads for government help to save biofuel jobs (BBC)
Scotland’s biggest Biofuels company, Argent Energy in massive green jobs blow (Unite the Union)
Biodiesel plant closure would be 'devastating' for Lanarkshire (BBC)
Argent Energy to close biodiesel plant in Motherwell, Scotland, due to market conditions (Argent Energy/Biobased Diesel Daily)

Excerpt from Unite the Union: Unite says Scottish government needs to ‘step in now’ or its green jobs strategy will be ’in ruins’

Unite is calling on the Scottish government to ‘step in now’ as 75 jobs are at risk following the announcement by Argent Energy that it plans to close its biodiesel plant in Newarthill.

The union responded to the latest green jobs setback in Scotland as Argent Energy confirmed its plans to mothball its North Lanarkshire plant by the 31 May following a brief consultation period, while its other plants in Ellesmere Port, England, and the port of Amsterdam, Holland, are set to remain open.

The company supplies biodiesel to Stagecoach England, Metroline buses in London, and Eddie Stobart along with oil and gas companies including Shell and BP who blend its products with conventional diesel.

Unite which represents workers at Argent Energy has demanded government action stating funding streams including the Scottish government’s £500m just transition fund and low emission scheme grants must be urgently explored to keep the plant open.

Unite general secretary Sharon Graham said: “Argent Energy workers based at Newarthill are exactly the type of workforce supposed to be spearheading the march to greener jobs. The Scottish government needs to step in now or else its green jobs strategy will be in ruins. Unite will do all we possibly can to explore every option to keep the plant open.”

Argent Energy has inferred its closure decision has been influenced by imported Chinese biodiesel that benefits from state economic support and subsidies while also citing the UK’s inability to import category one tallow, which is the company’s main feedstock, from the EU due to regulations.

Esther O’Hara, Unite industrial officer, said: “Around 75 workers at Argent Energy face redundancy in a matter of weeks after the company confirmed it is set to mothball the plant by the end of May.”

“Closure would be a devastating blow to the workers and their families, but also for the Scottish government’s just transition ambitions. There is £500 million set aside for green jobs and there are also low emission scheme grants worth tens of millions which this plant should be able to access.”

“It would be a cruel irony that one of the reasons given by the company for the plant’s closure is down to other governments subsidising biodiesel imports into the UK, yet our own governments in Edinburgh and London seem incapable of lifting one finger to support these jobs.” READ MORE

Excerpt from Agrent Energy/Biobased Diesel Daily: “Despite the excellent team and their considerable efforts, external factors affecting the U.K. and EU biodiesel market have driven the requirement to make a strategic change,” the company stated. “The decision, taken only after lengthy consideration of all other options, will concentrate the business on its other, better situated locations. The company is focusing its efforts on supporting all affected employees.”

Argent Energy’s Motherwell biodiesel operation is where Argent Energy’s story started back in 2005 producing 45,000 metric tons (13.5 million gallons) of waste-based biodiesel each year, before later expanding in 2016.

Argent Energy’s second plant in Ellesmere Port is located on the Manchester Ship Canal and its third is strategically positioned in the Port of Amsterdam.

An expansion of the Dutch facility is underway with initial plans to triple capacity.

The consultation for employees at the Motherwell facility is expected to start as soon as possible and Argent Energy will be working closely with all those impacted at this difficult time, the company stated.

“The decision to consult on closure of the plant was not easy,” Argent Energy said. “However, market conditions that have put severe economic pressures on biodiesel production facilities in the U.K. over the past two years have forced the move to ensure the continued strength and future of the business.”

Argent Energy CEO Louise Calviou said, “This has been the hardest decision for us to make and is one we have not taken lightly. After careful consideration of market conditions and our strategic goals for global decarbonization efforts, we believe it is a necessary step we need to take. We and our shareholder remain dedicated to our ambitious growth plans, and our mission to displace as much fossil fuel as possible continues.”

The main external conditions that have substantially weakened the environment for European and U.K. biodiesel production are:

Unprecedented competition from imported Chinese biodiesel that benefits from state economic support and subsidies.
Approvals by HM Revenue & Customs for major U.K. fuel suppliers to utilize inward processing relief and avoid the normal 6.5 percent duty for imported biodiesel. This is also estimated to have led to lost treasury revenue of around £150 million (USD4189.6 million) in 2023.
The removal of trade-defense measures by the U.K. after Brexit on renewable diesel from the U.S., which competes with U.K. biodiesel. This has resulted in an increase of imports of subsidized U.S.-made product of nearly half a million tons.
Post Brexit, the inability for the U.K. to import category 1 tallow—Argent’s main feedstock—from the EU, due to EU regulations.

These challenges have taken a toll on the sector as a whole and Argent Energy is working with the industry and U.K. government to solve these structural imbalances and put the sector back on an even footing, preventing further damage to the U.K. industry. READ MORE