LONDON (Reuters) -State Oil Limited, parent company of the 133,000 barrel per day Lindsey oil refinery, has begun insolvency proceedings and been placed under administration by Britain's High Court,
Insolvency Proceedings Begin at UK's Lindsey Oil Refinery, 420 Jobs at Stake
By Shadia Nasralla
LONDON (Reuters) -Britain's Lindsey oil refinery has begun insolvency proceedings, putting hundreds of jobs at risk and potentially increasing the country's reliance on fuel imports just weeks after its Grangemouth refinery stopped processing oil.
Lindsey is one of six remaining oil refineries in Britain, according to the U.S. Energy Information Administration, and employs around 420 people, according to FTI, the refinery's special manager through the insolvency process.
Lindsey, with the capacity to refine 113,000 barrels per day according to the website of its owner Prax, has been placed under a winding-up order alongside Prax Storage Lindsey Limited and Prax Terminals Killingholme Limited, the government said on its insolvency service website.
FTI Consulting has been appointed special manager of the companies, tasked with helping to liquidate them.
"There have been longstanding issues with this company and workers have been badly let down," Energy Minister Michael Shanks said in a statement.
"The Secretary of State is today writing to the Insolvency Service to demand an immediate investigation into the conduct of the directors, and the circumstances surrounding this insolvency."
Prax, led by Chairman and CEO Sanjeev Kumar Soosaipillai, could not immediately be reached for comment. It bought Lindsey from TotalEnergies in 2021 for around $168 million, according to a Prax presentation.
In another presentation, Prax said that last year it recorded adjusted earnings before interest, tax, depreciation and amortisation of $120.4 million and that its adjusted net debt to equity ratio stood at 0.31 times in February 2024.
Earlier on Monday, management consultancy firm Teneo said it had been appointed administrator of State Oil Limited, Prax's parent group.
Teneo also said staff at Lindsey were currently remaining in place and being paid.
State Oil joint Administrator Clare Boardman, of Teneo, said that all options would be considered, including a sale of Prax's upstream business and retail operations in Britain and Europe, all of which remain outside of insolvency.
Prax's upstream business consists of the Lancaster oilfield in the British North Sea, a geologically complex project which has been in an early production phase for years. It produced around 6,300 bpd last year, according to a presentation on Prax's website.
Prax runs around 250 retail fuel sites in Britain, including TotalEnergies-branded stations, in addition to petrol stations in Germany, Austria, Switzerland and Denmark.
($1 = 0.7299 pounds)
(Reporting by Shadia Nasralla. Additional reporting by Ahmad Ghaddar and Susanna Twidale. Editing by David Goodman and Mark Potter)
