Sale of Prax Lindsey Refinery
The successful bidder for one of the country’s last remaining oil refineries has said it has no plans to restart fuel production at the site and cannot guarantee how many jobs will be retained. On Monday, it was announced that Phillips 66, which already owns the Humber refinery in north-east Lincolnshire, had agreed a deal to buy the nearby Prax Lindsey refining assets.
Background of the Refinery
The Prax Lindsey refinery closed in June last year after the parent company brought in administrators, resulting in the loss of 125 jobs. Thanks to government support, a total of 250 additional employees were retained until at least the end of March to enable a sale to be completed.
Future Plans for the Refinery
Phillips 66 said its investment would save hundreds of jobs, but gave no direct commitment to retaining the transferred workers beyond March. Following a thorough review during the bidding process, the company has decided not to resume standalone refining operations at the Lindsey Oil Refinery. Due to limited size, equipment, and capacity, assessments have shown that the refinery is not viable in its current form.
Benefits of the Acquisition
When completed, the acquisition and strategic investment will enhance the company’s ability to supply the UK market from the Humber refinery, increase the UK’s energy security, and support hundreds of well-paid, high-quality jobs through the operation of the site and future investment. The storage and other infrastructure assets will enhance operations at the Humber refinery, improve fuel supplies to UK customers, and drive future growth opportunities for renewable and traditional fuels.
Reaction from Phillips 66 and the Government
Paul Fursey, managing director of Phillips 66 UK, recognized the difficulties the closure of the site has caused for the workforce and the local community. He stated that this sale is the best way to secure jobs, strengthen the local economy, and encourage investment in the region. Energy Minister Michael Shanks said Phillips 66 was the "most credible bidder" in the search for a buyer, and this agreement represents the next step in securing an industrial future for the Lindsey site and the workers.
Impact on the UK’s Energy Security
The closure of the Lindsey refinery last year left the UK with just four fuel refineries, leaving the country reliant on fuel imports to ensure supplies, particularly in Scotland. The sale agreement allows Phillips 66 to rapidly expand operations at the neighboring refinery, with all remaining employees guaranteed employment until the end of March. This will expand the company’s ability to supply fuel to UK customers, increase domestic energy security, and protect jobs – including hundreds of new construction jobs over the next five years.
