(crsrisk) -- The future of
Petroplus’ UK refinery Coryton, which employs around 900 people, will be decided
by the middle of May, when the current deal supplying it with crude runs out,
administrator PwC said.
Work on a potential sale or restructuring
of the refinery’s debt is underway with a view to reaching an agreement before
the deal expires in the middle of May, or the plant will close. "We’ll do
a deal or shut Coryton when the current arrangement finishes," Steven Pearson,
partner and joint administrator of Petroplus Refining & Marketing Limited
The plant received a three-month lifeline in February from a
consortium of Morgan Stanley, private equity firm KKR and the co-founder of the
stricken Petroplus Marcel Van Poecke. But with capital expenditure needs
of around USD1 billion and upcoming maintenance costing USD150 million due in
September, the economic conditions for securing a prompt deal remain
challenging. "One of the big factors here is that with the price of oil
being where it is at the moment, the cost of funding the working capital is so
enormous in the short term, that the economics are difficult," Pearson said.
"But that’s true for any refiners out there."