The Scottish Government has been urged to strip Mossmorran of its operating licence if further environmental breaches are uncovered.
The demand from the Scottish Greens comes amid calls from campaigners for an independent investigation to ensure proper protection for the community.
Following an inquiry into prolonged flaring last June, the Scottish Environmental Protection Agency has issued ExxonMobil Chemical and Shell UK with final warning letters.
It has also commissioned a full review of environmental permits and pledged an enhanced programme of air monitoring at the Fife site.
Mid Scotland and Fife Green MSP Mark Ruskell raised the issue at First Minister’s Questions at Holyrood, saying a final warning should mean just that.
He said two more investigations into flaring last October and again in March should be concluded as soon as possible, adding that if the firms were not prepared to operate within environmental law, “they should not be allowed to operate in Fife any longer.”.
Both Shell and ExxonMobil are cooperating with SEPA and said they were working to address any issues identified.
A Shell spokesperson added: “We stepped up our engagement in the community last July to understand people’s concerns.
“This work is ongoing with community groups and other parties to address concerns raised.”
Apologising to locals, ExxonMobil added: “We continue to invest in projects utilising the latest technologies and enhancements for the long-term future of the plant.
“Our team at FEP will continue to work with SEPA, other relevant agencies and the local community to monitor and minimise the impact of flaring.”
James Glen, the chairman of Mossmorran Action Group, said: “SEPA’s report is very welcome, particularly the recognition that ‘the impact of unplanned flaring from Mossmorran last year was both preventable and unacceptable’.
“SEPA is clear the flaring was down to a lack of maintenance by the operators which must raise questions about the overall safety of the plant.”
Cowdenbeath SNP MSP Annabelle Ewing said last June’s flaring had caused nuisance and genuine worry about safety and health implications.
Welcoming SEPA’s “tough line”, she urged the operators to fully engage with its requirments, and the remaining investigations.
“This action has been described as a final warning, and it must be just that,” she added.
Labour MP Lesley Laird said: “Communities who for too long suffered from light and noise pollution associated with flaring at Mossmorran will be relieved SEPA is finally taking appropriate measures and steps.
“However, this is only the start of a process to get to grips with these issues and clearly it’s what happens now to stop flaring episodes in future that will determine whether public confidence can improve.”
Mid Scotland and Fife Labour MSP Alex Rowley also welcomed the report and said he would talk to Fife Council about its role in monitoring air quality in nearby communities.
“I want to see regular monitoring taking place in the whole of the surrounding area,” he added.