Petroplus, Europe’s biggest independent refiner, is set to close three of its five oil refineries over the coming weeks after bankers froze its credit lines abruptly this week. As a result of the freeze, the company has run out of money for crude supplies.
Although discussions with bankers are said to be ‘open and constructive’, the company will start temporary economic shut downs of the Petit Couronne (France), Antwerp (Belgium) and Cressier (Switzerland) refineries this week, reflecting on the limited credit availability and the wider economic climate in Europe. The sites have a combined processing capacity of 337 300 bpd.
The company can be seen as a victim of oversupply in European refining and of an investment strategy that fell foul of an industry downturn. Petroplus and European government officials have been engaged in talks with the 13 banks that froze a US$ 1 billion facility it needed to buy crude oil.
550 workers at the Petit Couronne refinery are set to meet union representatives from nearby refineries on January 4th to decide whether or not to call for strike action.
Workers are currently said to be preventing deliveries of stockpiled refined products worth approximately € 200 million, with the hope of safeguarding the future of the site.
A representative of the union has predicted that the closure, although billed as temporary, could signal the permanent shut down of the facility, due to poor margins and an unforgiving economic climate.
The suspension is the fourth French plant to close in three years, clearly symbolising the decline of refining profits in Europe.
Read the article online at: https://www.hydrocarbonengineering.com/gas-processing/04012012/petroplus_closure_could_lead_to_union_action/