• Exxon cited challenging market conditions, rising supply costs, and an unfavourable UK policy environment as the rationale behind the move.
• Exxon to shut down the Fife plant in February 2026.
• Exxon’s talks with the UK government were unsuccessful.

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Exxon Mobil Corp. (XOM) is reportedly set to lay off 200 workers and shut its Fife Ethylene Plant in Mossmorran, Scotland. The energy giant will shut down the plant in February 2026, the Financial Times reported on Tuesday. It would also result in 250 contractors losing their jobs.

The Fife Ethylene Plant is a major petrochemical facility that converts ethane into ethylene, a key component in the manufacturing of plastics.

Why Is Exxon Closing The Fife Plant?

Exxon cited challenging market conditions, rising supply costs, and what it described as an unfavourable UK policy environment as reasons behind the decision. Exxon’s efforts to sell the plant were unsuccessful.

The company said it would proceed with decommissioning and demolishing the site once operations cease. Exxon reportedly approached the UK government to explore whether it could obtain support to improve the Fife plant’s viability. However, the discussions were not successful.

Despite the closure, Exxon plans to remain invested in the UK through its Fawley refinery, fuel distribution network, service stations, and North Sea energy assets. The company stated that the shutdown would not impact ethylene supply to its European manufacturing operations.

A Bigger Issue?

The Fife shutdown follows other high-profile refinery closures this year, including Grangemouth in Scotland and Lindsey in England, reflecting mounting financial strain across the sector.

The UK petrochemicals sector is struggling to keep up with cheaper imports from Asia and the pressure of carbon costs.

The UK’s planned carbon border adjustment mechanism (CBAM) from 2027 has come under scrutiny for excluding refineries and chemical plants, leaving domestic producers at a disadvantage because foreign ethylene importers will not face equivalent carbon charges.

Under the proposed scheme, importers of certain goods, including fertilizers and aluminum, will be required to pay an equivalent cost for the carbon emissions associated with their production. However, this doesn’t apply to importers of ethylene into the UK, leaving domestic producers such as Exxon’s Fife plant in a difficult position.

Exxon executives have previously warned parliament that such policy gaps could trigger a “catastrophe” for the UK refining industry.

XOM stock was down 0.3% on Tuesday.

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