The Health and Safety Executive has submitted its report to the Crown Office following a routine investigation at the plant run by ExxonMobil
Inspectors visited Fife Ethylene Plant in the Spring of 2019.
The possible action is separate to last year’s submission to prosecute lodged by Scotland’s environmental watchdog, SEPA, after unscheduled flaring sparked hundreds of complaints from local communities.
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The plant owners said the issues raised by the HSE have been resolved, but news of the move to prosecute led to calls from the Scottish Greens to Michael Matheson, the new Cabinet Secretary for Net Zero to take urgent action over the Fife plant.
The latest development comes as FEP begins a £140m refurbishment - and puts the plant back in the public spotlight.
The HSE report centres on the release of hydrocarbons two years ago, and its website lists a number of impacts on health if exposed to them.
Greg Haywood, HSE principal inspector of health and safety, said: "Thorough inquiries have been made into this issue and a formal report has been submitted to the Crown Office and Procurator Fiscal Service."
A spokesman for ExxonMobil said the matters had already been resolved.
He added: “We were fully aware of, and were actively working solutions to, these matters. We cooperated constructively with the HSE, and these matters have since been resolved.
"Fife Ethylene Plant works within the highest regulatory standards, is committed to its environmental responsibilities and complies with all applicable laws.
''We operate to the very highest safety and risk management practices, and work closely with the HSE in full compliance with their approved processes."
Mossmorran also faces possible court action for unscheduled flaring in April 2019 which led to more than 900 complaints - SEPA has already made a submission to prosecute.
Mark Mark Ruskell, MSP from the Scottish Greens, said the actions “raises serious doubts about the operator’s commitment to even the most basic compliance issues.”
He called on Mr Michael Matheson, to address Mossmorran “as a matter of urgency.”
Mr Ruskell added: “Not only have the people of Cowdenbeath and Lochgelly been subject to the most appalling light and sound pollution, their toxic neighbour has also been emitting dangerous hydrocarbons too.
"This is the second time in less than a year that a statutory body has recommended ExxonMobil faces prosecution for their clear disregard for environmental and safety standards at Mossmorran. It raises serious doubts about the operator’s commitment to even the most basic compliance issues.
“It’s clear they cannot be left to their own devices when it comes to tackling the climate emergency.
“This plant remains Scotland’s third biggest industrial emitter, and we can no longer trust Exxon and Shell to come up with their own plans for decarbonisation if we are to have any chance of meeting our goal of net-zero by 2045.”He added: “Decarbonisation within the next decade must be a condition of allowing the plant to continue operating.”
The HSE report to the Crown Office was also welcomed by Mossmorran Action Group.
Linda Holt, spokesman, said: "This is very welcome news but it is frightening that it has taken HSE two years to complete a report and submit their findings for possible criminal prosecution."