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Vivergo Fuels has announced proposals to close its £350m biofuel plant at Saltend at the end of September, putting 150 jobs at risk.

The plant has endured a rocky year and when production was temporarily halted last November, fingers were pointed at the government for its “inaction over the future of renewable fuels”.

The plant re-opened in April but just five months on new plans have been revealed to close the factory for good.

Mark Chesworth, managing director at Vivergo Fuels Ltd, said: “I am extremely disappointed at having to make this difficult choice to plan to cease production as of September 30 at the Vivergo Fuels plant.

“We have created a highly skilled and world-class business that had the opportunity to be part of a British sustainable biofuels industry.

“But sadly, the government’s lack of pace over the past decade to introduce E10 has further undermined our ability to operate.

"My employees are my number one concern at this time and we have entered into consultation with them.”

E10 is a biofuel which is being gradually rolled out across the country in a bid to reduce carbon emissions.

When Vivergo Fuels opened in Saltend back in 2007 it was heralded as, “one of the most significant investments in the north of England.”

The knock-on effect of the planned closure is expected to be significant.

More than 900 farms across Yorkshire supply the plant with over 1.1m tonnes of feed wheat and the disappearance of Vivergo could both directly and indirectly effect as many as 3,000 jobs.

Dr Mark Carr, group chief executive of Vivergo’s owners AB Sugar, said: “It is with a heavy heart that I announce the proposed cessation of production at the Vivergo Fuels plant.

“In 2007 we had an ambition to create a British biofuels industry in the North of England.

“We are making this difficult choice as a result of continued trading conditions; characterised by a low bioethanol price, high wheat price and a slow growing market hindered by a lack of pace by the government to introduce E10.”

(Image: Darren casey)

A consultation has now been launched with the 150 staff at the plant but if plans go ahead, Vivergo will shut down at the end of this month.

Vivergo currently contributes around £600m to the UK economy and its closure would come as a massive blow to the country’s biofuel ambitions.

“I would like to take this opportunity to thank our workforce, past and present partners, growers and customers for their support since the creation of our plant in 2007,” Mr Chesworth said.

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