Redcar Ensus plant to reopen amid Iran War shortage fears

The Ensus plant, in Lazenby, Redcar, was wound down last year after a trade deal with the US cut tariffs on bioethanal, its main product. 

But yesterday Business Secretary Peter Kyle signed off an up to £100 million Government grant to reopen the site, mainly due to the carbon dioxide it produces as a by-product. 

The gas is vital for several sectors, including drinks and the nuclear industry, but supply has been disrupted thanks to soaring energy costs on other sources such as fertiliser factories.

It is understood the grant – the first major intervention by the Government to tackle possible shortages due to the war – will pay to get it up and running again for an initial three months.

Redcar MP Anna Turley said she was “absolutely delighted” that around 100 direct jobs would be safeguarded at the site and another 3,000 supported across the UK supply chain. 

Early last year, the plant warned it faced “imminent closure” due to the Government’s new US trade deal, meaning bioethanol could be imported tariff-free.

However, fresh hopes were raised later in the year when talks were held about the plant being used mainly for the production of carbon dioxide.

The Ensus site (Image: PR)

Ms Turley said: “When I was elected, I promised I would always stand up and fight for every single resident and every single job. I’m proud to stand by the workers at Ensus and the thousands of people connected to it.

 “The last few months have been incredibly difficult. I’ve heard directly from workers worried about their jobs and their future, and it’s been frustrating at times not being able to say more while discussions were ongoing.

“That’s why I’m absolutely delighted to see this £100 million deal secured with the Labour government. 

“This is about real security — for the workforce, their families, and the thousands of jobs across the chemical industry supply chain that depend on this site. 

“It’s also a clear example of this Labour Government stepping in to protect critical industry, strengthen our national resilience, and back places like Redcar & Cleveland and the wider Tees Valley.

“This is exactly the kind of intervention we need to see — a Labour government backing British industry, protecting jobs, and securing our future. 

“I will always fight for our local industries and the people who rely on them.”

Grant Pearson, chairman of Ensus UK, said: “This agreement of support from the UK Government is excellent news for our employees and those in our extensive supply chain. 

“It strengthens the broader Teesside manufacturing economy and the UK’s resilience in relation to biogenic CO2 supplies. These are vital to food and drinks companies, as well as being important to hospitals, abattoirs and the nuclear industry.

“We hope to have the plant back in full operation soon. 

“This deal will also be very supportive to the UK agricultural and fuel markets including for the future expansion which is required in more sustainable aviation and maritime fuels and in the development of greener chemicals.

“I’d like to thank our loyal employees for their resilience and support during what has been a difficult period and pay particular tribute to MPs Anna Turley and Chris McDonald for their tremendous efforts in making this deal happen.”

Business Secretary Peter Kyle said: “As a government of action we will always do what’s needed to ensure resilience and protect British businesses from the worst impacts of global uncertainty. 

“That’s why we intervened last Autumn to keep this critical plant on standby for situations like this.

“By restarting this plant we’ve acted swiftly to boost the resilience of our supply chains and protect critical UK sectors like food production, water and healthcare, as well as the jobs and communities that depend on these industries.”

Despite the positive news, there are fears that the UK could face oil and gas shortages in two to three weeks as a result of the conflict. 

The key question remains how long Iran’s effective blockade of the vital Strait of Hormuz will last.

On Thursday, Foreign Secretary Yvette Cooper will urge Iran to reopen the Strait of Hormuz as she travels to the G7 Foreign Ministers’ meeting in France.

She will make clear that the UK will help ensure safe passage for ships through the strait and provide an additional £2m in humanitarian aid to Lebanon.

Iran’s foreign minister Abbas Araghchi claims it is open to “non-hostile” shipping.