Hundreds of jobs are at risk after the owner of a UK oil refinery went into administration – sparking calls by the government for an "immediate investigation". Prax Lindsey Oil Refinery Limited, which owns the plant in Immingham, North East Lincolnshire, filed for insolvency on Sunday and an official receiver has been appointed. The are 420 employees at the refinery, though Unite the Union said 1,000 jobs were at risk when taking into account contractors and the supply chain. Michael Shanks, the energy minister, said workers had been "badly let down" and the government was demanding "an immediate investigation into the conduct of the directors and the circumstances surrounding this insolvency". Prax Group, which is led by chairman and chief executive Sanjeev Kumar Soosaipillai, purchased Lindsey Oil Refinery from French company Total in 2021. The Department for Energy Security said the the company's financial reports indicated the plant had recorded losses of about £75m between the takeover in 2021 and February 2024. It said the company was "unable to adequately answer" repeated requests from the energy secretary about its finances. Sharon Graham, Unite's general secretary, said: "The Lindsey oil refinery is strategically important and the government must intervene immediately to protect workers and fuel supplies. "Unite has constantly warned the government that its policies have placed the oil industry on a cliff edge. It has failed to act and instead put its fingers in its ears. "The government needs a short-term strategy to keep Lindsey operating and a sustainable long-term plan to fully protect all oil and gas workers." Shanks said: "There have been longstanding issues with this company and workers have been badly let down." He said the government would "do everything we can to support workers and the local community". "The company has left the government with very little time to act," he added. FTI Consulting said it had been appointed as "special managers" to assistthe official receiverduring the liquidation process. It confirmed there were 420 employees at the refinery but would not comment further. Teneo has been appointed as administrator for Prax Group's parent company, State Oil, which employs 182 staff andowns 190 petrol stations in the UK, along with 325 others in Europe. Clare Boardman, from Teneo, said administrators would be "considering all options for the group, including the prospect of a sale for the group's upstream business and retail operations in the UK and Europe, all of which remain outside of insolvency". According to the government, Lindsey is the smallest of the UK's oil refineries producing fuel. It is located next to the Phillips 66 Humber refinery, which is the dominant fuel supplier in the region and continues to operate at profit. Listen to highlights fromLincolnshire on BBC Sounds, watch thelatest episode of Look Northor tell us about a story you think we should be coveringhere.
Calls for inquiry as 420 refinery jobs at risk
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"UK Government Calls for Investigation After Prax Lindsey Oil Refinery Enters Administration"
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TruthLens AI Summary
The Prax Lindsey Oil Refinery Limited, located in Immingham, North East Lincolnshire, has filed for administration, putting approximately 420 jobs at risk. The situation has drawn immediate concern from the UK government, which is calling for an investigation into the circumstances surrounding the company's insolvency. Energy Minister Michael Shanks expressed that the workers had been 'badly let down' by the company's management and emphasized the need for an urgent inquiry into the actions of the directors. The financial reports indicate that the refinery has suffered losses of around £75 million since Prax Group acquired it from Total in 2021. Unite the Union has raised alarms that the total number of jobs at risk—including those of contractors and supply chain workers—could reach 1,000, highlighting the extensive impact of the refinery's closure on local employment and the energy sector as a whole.
In response to the crisis, Sharon Graham, general secretary of Unite, called for immediate government intervention to protect not only the workers but also fuel supplies. She criticized the government's previous inaction, stating that their policies have pushed the oil industry to a precarious position. The government has pledged to support the affected employees and the local community, with Shanks reiterating the urgency of the situation, noting that the company has left little time for action. Amidst the turmoil, FTI Consulting has been engaged to assist in the liquidation process, while Teneo has been appointed as the administrator for the parent company, State Oil. They are evaluating all options, including the potential sale of the group's upstream and retail operations, which are presently not facing insolvency. As the smallest oil refinery in the UK, Lindsey plays a crucial role, especially in light of its proximity to the more profitable Phillips 66 Humber refinery, making the outcome of this situation critical for the region's energy landscape.
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