Petrol supplies and jobs are under threat
10:16am UK, Tuesday January 24, 2012
More than 1,000 jobs are at risk after one of the UK’s largest oil refineries announced it would halt supplies, as its Swiss owner prepares to file for insolvency.
The Coryton refinery in Essex suspended sales on Monday after negotiations with lenders broke down and credit lines were suspended, leading to a default on $1.75bn (£1.12bn) of owner Petroplus’ debt.
Coryton has a total capacity of 175,000 barrels of crude oil per day and is responsible for approximately 20% of petrol supplies to London and the South East.
It was bought by Petroplus from BP in 2007 for $1.4bn (£900m).
Shares in the Zurich-based firm stopped trading on the Swiss stock exchange at the request of the company.
Chief executive Jean-Paul Vettier said: “It is unfortunate to have reached the point where the executive committee and board of directors have to inform our employees, shareholders, bondholders and other stakeholders about these circumstances.
“We have worked hard to avoid this outcome, but were ultimately not able to come to an agreement with our lenders to resolve these issues given the very tight and difficult European credit and refining markets.
“We are fully aware of the impact that this will have on our workforce, their families and the communities where we have operated our businesses.”
Supplies across London and the South East could be affected and I have been told this could impact the Olympics.
Richard Howitt, East of England MEP
East of England MEP Richard Howitt has joined European parliamentarians to discuss a way to save the jobs at Petroplus.
Speaking to the BBC Radio 5 Live, Mr Howitt said: “One thousand job losses in Essex will have a devastating impact on the local economy.
“I don’t want to be alarmist about this, but I don’t want to be dishonest either. Supplies across London and the South East could be affected and I have been told this could impact the Olympics.”
He added that half the jobs at stake are well-paid, highly skilled positions, while the other half were contractors, many of whom have already received their redundancy notices.
Meanwhile Essar Energy has said its refinery in Stanlow was operating as normal, adding: “If there are opportunities to fill gaps in the market caused by the absence of Coryton we would obviously look to do so.”