UK government demands probe into insolvency of Lindsey oil refinery

Keep knowledgeable with free updatesSimply signal as much as the Oil & Fuel business myFT Digest — delivered on to your inbox.The UK authorities has known as for an investigation into the homeowners of the Lindsey Oil Refinery after the power fell into insolvency.The refinery in north-east England, which was purchased by the privately owned Prax Group in 2021, filed for insolvency over the weekend, a UK authorities spokesman mentioned on Monday. Lindsey processed about 96,600 barrels of oil a day in 2024, and about 400 persons are employed on the web site on the banks of the river Humber. An official receiver has been appointed as liquidator. Staff stay in place and proceed to be paid.Its plunge into insolvency is the most recent blow to the UK’s beleaguered refining business, after rival Ineos stopped refining crude oil at its facility in Grangemouth, Scotland, which means Britain can have solely 4 refineries left. The UK authorities mentioned Lindsey had misplaced about £75mn since Prax acquired the power from TotalEnergies of France in 2021, and that the corporate had been “unable” to reply questions from the federal government about its funds. Michael Shanks, UK power minister, mentioned there had been “long-standing points” with the refinery, and that the secretary of state was to name for an investigation into administrators’ behaviour across the insolvency. “The corporate has left the federal government with little or no time to behave,” he mentioned.Privately held Prax was based by chief government and chair Sanjeev Kumar Soosaipillai in 1999. Soosaipillai began with a single petrol station close to St Albans and has grown the enterprise right into a sprawling conglomerate together with refineries within the UK and South Africa, a community of petrol stations and a buying and selling enterprise. Soosaipillai’s household owns 100 per cent of the group, in line with an individual aware of the corporate.Like different European refineries, Lindsey had been struggling commercially for a while, the individual mentioned. Relatively than run the refinery as a standalone firm, Soosaipillai has tended to make use of cross-group ensures to assist finance its operations, leaving different components of the corporate uncovered to the insolvency course of, the individual added.The Lindsey refinery is provided with crude oil by Glencore, below a deal signed final 12 months. Glencore declined to remark.