Monday, July 22, 2024

Coryton to close with the loss of up to 850 jobs

OPERATIONS at the Coryton refinery are set to be wound down after its administrators failed to secure a going concern sale or refinancing package.

The Corringham-based refinery collapsed into administration in January after Swiss oil refiner Petroplus – which ran the former BP site – filed for insolvency reports Insolvency News.

Despite securing an agreement for the refinery to continue trading in February for several months, efforts to secure the long-term of Petroplus Refining and Marketing (PRML) look to have been in vain.

Administrators PricewaterhouseCoopers (Pwc) cited the current economic climate and the challenge of raising £625m of funding for the refinery’s travails.

All work connected with the refinery’s turnaround programme has now been suspended and joint administrator Steven Pearson said any closure process would take up to three months.

“Together with the PRML management and the PRML creditors’ committee, we have worked tirelessly to explore all feasible options for the refinery,” he said.

“We have had contact with over 100 possible investors and purchasers. We have been unable to reach a deal to date.

“The current financing market is exceptionally difficult – capital is short and expensive.

“Prospective investors in the refinery faced a significant capital expenditure need, as well as a fragile market for refined oil products.

“These factors have conspired against us in trying to structure a deal.

“I would like to thank the management, the employees, contractors, customers and suppliers for their support and solidarity during the past four months.

“Without their commitment we would not have been afforded the opportunity to continue the business and explore a going concern solution.”

“Any closure process is likely to take up to three months, during which time discussions regarding a possible sale will continue.”

On entering administration the refinery employed some 500 employees while 350 contractors worked at the base.

It can produce 220,000 barrels a day at full capacity and also supplied about 20% of the South East’s fuel.

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