Oil Refining Sector

Edward Leigh Excerpts

Thursday 11th December 2025 Westminster Hall

[Sir Edward Leigh (Gainsborough) (Con)]

I thank my hon. Friend and constituency neighbour the Member for Brigg and Immingham (Martin Vickers) for securing this timely debate about Lindsey oil refinery, which employed many of my constituents. The closure is a disaster for our Greater Lincolnshire area. It is, I believe, a direct result of green policies that are no longer logical.

I am no climate change sceptic. I am prepared to have investment in green energy—we are world leaders in offshore wind in the Humber, are we not? We are doing our bit, but the Government are taking it to new heights. All ideologues are dangerous, but fanatical ideologues are the most dangerous of all, and that is what we have in our Secretary of State. We have these ludicrous targets; I commend the editorial in The Times today calling it “targetitis”. Originally, Theresa May arbitrarily set a limit of 2040. Where did that come from? Boris Johnson, in his bumptious, casual way, not considering the evidence, unilaterally cut it down to 2030. Where did that come from? All this is massively damaging.

I would not mind if we were actually making a difference to global warming, but we are responsible for only 1% of global emissions. According to some estimates, our total global emissions are less than China’s annual accrual. We are making absolutely no difference! China holds us in contempt. It is doing to us what we did to it in the 19th century. China is totally ruthless.

[Luke Taylor (Sutton and Cheam) (LD)]

Will the right hon. Member give way?

[Sir Edward Leigh]

I give way to the hon. Gentleman, who is the son of a very distinguished councillor in my constituency.

[Luke Taylor]

It is a pleasure to contribute to this debate. Together, the 100 smallest carbon-emitting countries represent more carbon emissions than China on its own, so if all those smaller-emitting countries make their own contribution it can make a bigger contribution to cuts than China. Does the right hon. Member not agree that those small measures add up to a huge difference globally?

[Sir Edward Leigh]

That may be a fair point. I said at the beginning of my speech that I am not a climate change sceptic. Everybody is prepared to do their bit.

I have already mentioned wind farms, but what about solar energy? In Lincolnshire we are prepared to have solar energy on our farmland, but in my constituency 16,000 acres of the most productive land in the entire country—enough land to feed the city of Hull every single year—is put under solar farms, with panels manufactured in China, destroying our ability to feed ourselves. There has to be a balance, but at the moment we do not have one. We are importing so much from our dear friends in Norway that they are opening 250 exploration wells.

This debate, secured by my hon. Friend the Member for Brigg and Immingham, is extremely timely. The closure of Lindsey oil refinery is a complete disaster. It employs many of our constituents and is vital for the whole of our industrial infrastructure. We need strong domestic refining capacity. The Secretary of State goes on about energy security all the time, but that would strengthen energy security at a time when we are already importing two thirds of our gas and increasing volumes of refined fuels.

I would not mind these green policies, but we are not actually contributing to tackling global warming; we are simply exporting carbon emissions to other countries. It is complete madness. If we were sensible about this, and if it were possible to get some sort of global recognition of the problem, maybe we could start to tackle it. Relying on foreign refiners means exporting jobs and value overseas while leaving Britain more exposed to global price shocks and geopolitical risks. Expansion of the UK refining sector protects thousands of highly skilled, well-paid jobs. It also supports an entire region and supply chain in engineering, fabrication, logistics and maintenance. Those are precisely the jobs that sustain industrial communities and create apprenticeships for young people.

Refining underpins every major industrial sector. Manufacturing, aviation, defence, logistics, agriculture and pharmaceuticals all depend on reliable supplies of fuels and petrochemicals. Allowing it to pass into decline would simply shift production to countries with weaker environmental standards.

Lindsey oil refinery was a major economic anchor for our area. We know that it was put into administration. I share the comments of my hon. Friend the Member for Brigg and Immingham: this is a national crisis in terms of national policy, which is wrong, and of local policy. The people of Greater Lincolnshire demand action from this Government, and they demand it now.

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[Lee Anderson (Ashfield) (Reform)]

It is a pleasure to serve under your chairmanship, Mr Western. Of course, we have been here before with industry in this country. I remember what happened to the coal mines back in the 1980s. I worked in the coal mines in Nottinghamshire and Derbyshire, and the whole industry was decimated by the Conservative Government at the time—

[Sir Edward Leigh]

You were a Conservative once!

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[The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Katie White)]

It is a pleasure to serve under your chairmanship, Mr Western. I have really enjoyed the debate, which has been full of passion and emotion. I heard the anger, including in what my hon. Friend the Member for Alloa and Grangemouth (Brian Leishman) said, but I also heard that there is a lot of commonality in some of our values and on the transition that we are trying to achieve together. I have genuinely enjoyed listening and I have noted lots of points. There were a lot of questions; I will endeavour to get through them, but if I do not, we may need to follow up in writing to hon. Members.

I thank the hon. Member for Brigg and Immingham (Martin Vickers) for securing this important debate, and I am grateful to all hon. Members for their contributions. This is a timely opportunity to discuss a matter of strategic significance for our nation’s energy security: the future of the UK refining sector. The industry has helped to underpin our economy and our resilience for decades, and its future deserves our full attention. The Minister for Energy is in Grangemouth today, and I will say more about that later.

Our refineries play a crucial role in ensuring a stable supply of the essential fuels that keep our transport networks running, our industries operating and consumers supplied with the energy they rely on every day. The sector is more than just a fuel; it drives growth in key sectors, supports thousands of skilled jobs in communities and sustains supply chains for chemicals, plastics and manufacturing. Refineries also play a critical role in the wider downstream oil sector. The Humber refinery in the constituency of the hon. Member for Brigg and Immingham is the UK’s only source of anode-grade petroleum coke, which is essential for electrical vehicle production. The Fawley refinery contributed to the global covid-19 response by supplying the specialist halobutyl rubber used to seal vaccine vials.

Importantly, UK refineries are also investing in their own future through decarbonisation and diversification by deploying carbon capture or producing low-carbon fuels to support our transition to net zero. Demand for refined products will continue, even beyond 2050, and the UK’s refineries will remain essential for hard-to-abate sectors such as heavy industry, aviation and maritime. That is why, as my hon. Friend the Minister for Energy made clear in June, the Government are absolutely committed to securing the long-term viability of the UK’s refining sector, and, as set out in the autumn Budget, we are reviewing critical policies to address the challenges that the sector faces.

Those challenges are real. In the 1970s, the UK operated 18 refineries; today, as has been said many times during the debate, only four remain. Falling demand for traditional fuels, global competition from mega-refineries in the middle east, India and Africa, changing trade dynamics and ageing assets all put pressure on UK operations. But with challenge comes opportunity, and the Government are determined to seize the opportunities by driving innovation, supporting investment and ensuring that the refining sector continues to play a vital role in our economy and for our energy security for decades to come.

The Government have already taken significant steps to support the refining sector and the wider fuel sector, and we are committed to do more. We have driven the shift to low-carbon fuels through the renewable transport fuel obligation, and this year we went further with the sustainable aviation fuel mandate, backing cleaner fuels for aviation. The Humber refinery already produces SAF at commercial scale, while Fawley and Stanlow are among the projects backed by our advanced fuels fund, which provides grants to accelerate the next generation of transport fuels. Refineries are playing a key role in driving the UK SAF industry forward, strengthening energy security with a home-grown supply. We are also de-risking investment in SAF production through the revenue certainty mechanism. We are working with industry to cut emissions through carbon capture and low-carbon hydrogen at major clusters such as Viking and HyNet. We will set out a clear plan for industrial decarbonisation to keep the UK competitive.

[Sir Edward Leigh]

The hon. Lady is giving a paean of praise for refineries, so why are the Government taxing them out of existence?

[Katie White]

I am glad that the right hon. Gentleman intervened, as I was going to come on to his points—in particular, his interesting point about the national interest. I say to him gently that I feel we are working in the national interest, but the national interest includes energy security as well as respecting the science of climate change, which is happening. As he is the Father of the House, I genuinely listened to his points, but I was a little disappointed—[Interruption.] He can laugh all he likes, but I listened to his points. He talked about the UK being responsible for less than 1% of emissions. That is the case in terms of nation states, but I think the UK’s impact in the world is so much larger, whether through people following our policy decisions, the impact of our banking sector or our consumption of goods, which has also come up a lot.

We are looking at how we manage the transition, and we want to do it in a way that respects the science, but I am also competitive about where Britain can take advantage of these industries. We want to make sure that we have these industries, including the wind turbines that the right hon. Gentleman mentioned, but we also want to look at how we can make the transition justly and fairly. I will come on to that later in my speech.

Last month, the UK ETS Authority confirmed that current benchmarks will stay in place for the 2027 scheme. That decision gives refineries and other energy-intensive industries the certainty that they need. By maintaining those benchmarks, we are providing stability and breathing space, helping businesses plan, manage costs and prepare for future changes to the scheme.

We are also reviewing compensation for energy-intensive industries. We announced in the autumn Budget that we are assessing the feasibility of including refined products in the carbon border adjustment mechanism, so that imported goods face an equivalent carbon price and the sector’s efforts to decarbonise will not be undermined by carbon leakage. This is the refining sector’s top priority, which the Government are committed to exploring as one of several levers to support the sector’s long-term future. These measures demonstrate our commitment to supporting investment, driving innovation and ensuring that the refining sector remains competitive and resilient as we transition to a low-carbon economy.

Looking ahead, the Government are taking further steps to secure the long-term future of the UK refining sector and to ensure a just transition. The Department for Energy Security and Net Zero has established a dedicated team to work across Whitehall and with industry. A number of Members asked about working across Whitehall; we will continue to do that, to ensure that we maximise the impact. This will guide how we manage the transition, protect energy security and support jobs and local communities.

We will continue to engage closely with the fuel industry to identify practical measures that can strengthen the sector. That is why, in June, we convened the first ministerial—[Interruption.]

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[Matt Western (in the Chair)]

Order. The Question is—

[Sir Edward Leigh]

On a point of order, Mr Western. You are a fellow member of the Panel of Chairs. Can we make it clear to our colleagues that it is normal courtesy for the Minister to allow the proposer of a motion some time to wind up, if only a minute? That did not happen on this occasion.

[Matt Western (in the Chair)]

The right hon. Member is absolutely right that it is a courtesy, but my understanding—I think he will understand this, too—is that it is not an obligation. On this occasion it was not possible for the Minister to do that, given the number of interventions that we had, as well as the full contributions from all the Members who chose to speak.

Question put and agreed to.

Resolved,

That this House has considered the future of the oil refining sector.