Fears were growing for the future of Stanlow oil refinery last night after it emerged that it was in talks over its finances and had suffered a string of director resignations.
Essar Oil UK said it was confident of surviving a pandemic-induced downturn despite concerns in Whitehall it could be on the brink of collapse.
The Stanlow refinery, near Ellesmere Port in Cheshire, supplies 16 per cent of British road fuel, sends jet fuel to Manchester airport through a pipeline and employs about 900 people.
Sky News, which first reported fears over Essar Oil UK’s deteriorating financial position, said meetings with government officials had been lined up for next week. Stein Ivar Bye, chief executive of Essar, resigned last month after five months in the role, Companies House filings show. He had been appointed to succeed Mark Wilson, who left last summer, also after five months.
Essar Oil UK is part of India’s Essar conglomerate controlled by the founding Ruia family. Rewant Ruia resigned as a director of Essar Oil UK at the start of this month and another director, Stephen Welch, resigned on Wednesday, according to company filings.
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A spokesman for Essar Oil UK said it had been “a very profitable business that has attracted over $1 billion in investment since its acquisition in 2011” but that repeated lockdowns due to the pandemic had led to reduced product demand and depressed refining margins.
He added: “We have successfully traded through a very difficult 12 months and are now seeing increased demand for road transport fuels and improving refining margins. Prior to coronavirus [we] were posting [earnings before interest, taxation, depreciation and amortisation] in excess of $300 million per year. We remain confident that we can manage through this period and come out stronger as the economy clearly continues to recover.”
He said Bye had left due to “personal events” and confirmed the two other directors had resigned but gave no reason.
A spokeswoman for the Department for Business, Energy & Industrial Strategy, said it “continually monitors fuel supply across the country to ensure the public do not see any disruption”.
