The government has stepped in to provide financial support for the continued operation of an oil refinery, as the company that owns it has gone into administration. According to a minister, the government is funding the official receiver to ensure the safe operation of the Prax Lindsey Oil Refinery Limited in Immingham, North East Lincolnshire, after it filed for insolvency. This move puts 420 jobs at risk, with potentially even more workers and contractors affected.
During a session in the House of Commons, Energy Minister Michael Shanks stated that the owner of Prax Group, Sanjeev Kumar Soosaipillai, should take responsibility and provide proper compensation for the affected workers. The government is also calling for an investigation into the actions of the company’s directors and the circumstances surrounding the insolvency. Prax Group had purchased the refinery in 2021 from French company Total, but financial reports have shown significant losses since then.
Despite reassurances from the company that there was no immediate risk of closure, they suddenly changed their position a week ago and expressed concerns about the refinery’s future. The government had repeatedly asked for information about the company’s financial situation in order to determine if they could provide assistance, but Prax Group was unable to provide this information in a timely manner.
As a result, the government is taking action to ensure that supplies are maintained, energy security is protected, and support is provided to workers and the local community. They are also urging the company’s leadership to fulfill their obligations to the workers and their families by providing proper compensation.
Unite, a trade union representing workers at the refinery, has called for immediate government intervention to protect both jobs and fuel supplies. They have also criticized the government for failing to take action to protect the oil industry and its workers.
The Insolvency Service has appointed special managers to assist the official receiver during the liquidation process, and administrators have been appointed for Prax Group’s parent company. According to the government, the Lindsey Oil Refinery is the smallest in the UK and is located next to a larger refinery that continues to operate at a profit.
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