Blow to Hull as £250m rare earth refinery plans axed
The facility was expected to create 126 skilled jobs
Last updated 16th Oct 2025
Hull’s ambitions to become a hub for the UK’s critical minerals industry have suffered a major setback after one of the city’s flagship investment projects was abandoned.
Pensana, which had pledged to build a £250m rare earths refinery at Saltend Chemicals Park on the banks of the Humber, has scrapped its plans to develop the site.
The facility was expected to create 126 skilled jobs and play a central role in the region’s push toward clean energy manufacturing.
The plant would have processed rare earth elements used in the production of high-powered magnets for electric vehicles and wind turbines, positioning Hull at the heart of Britain’s green industrial revolution.
Instead, the company will now shift its refining operations to the United States.
Pensana’s chairman, Paul Atherley, told Sky News that the decision followed a move by the Trump administration to guarantee purchases of rare earths from an American mine, giving US producers a major competitive edge.
The Saltend site had been hailed as a cornerstone of the UK’s critical minerals strategy when it was launched in 2022.
Then-business and energy secretary Kwasi Kwarteng described the refinery as “the only one of its kind in Europe,” adding that it would “secure the resilience of Britain’s supplies into the future.”
However, despite government pledges of funding, the grant never materialised and the refinery was never built.
The setback adds to growing concerns about the future of Hull’s chemicals industry, which has already seen a series of closures, including the shutdown of the nearby Vivergo biofuels refinery at Saltend.
A spokesperson for the Department for Business and Trade said:
"It is disappointing Pensana has decided not to proceed with this development, but it is ultimately a commercial decision for the company.
“We will publish a new Critical Minerals Strategy soon to help secure our supply chains for the long term, and we're reducing industrial electricity costs for businesses as part of our modern Industrial Strategy."