250 guaranteed employment at Lindsey Oil Refinery until March
A ‘binding deal’ for Lindsey Oil Refinery is expected in the coming weeks
It is understood a ‘binding deal’ for Lindsey Oil Refinery is expected in coming weeks. It has also been confirmed that workers that remain directly employed at the refinery are guaranteed employment until the end of March.
Lindsey Oil Refinery, near North Killingholme, became overseen by the independent Official Receiver on June 30 after Prax Group companies entered administration. FTI Consulting are also acting as special managers.
This week, Brigg and Immingham MP Martin Vickers (Conservative) got his debate on the future of the oil refinery sector in Parliament and again pressed the case for the future of Lindsey Oil Refinery. During this, he stated he understood the Government had said there will be no further redundancies until the end of March.
This has now been confirmed to the LDRS. An Insolvency Service spokesperson said: “A further 250 employees remain at the site. They are guaranteed employment until the end of March 2026.”
The sales process for the refinery site is continuing with bids being assessed. The LDRS understands that the Official Receiver expects to reach a binding deal in the coming weeks.
It is understood the complexity of the transaction has played a part in the long sales process. The Government remains hopeful of a solution in coming weeks that creates future employment opportunities at the site.
At the end of September, 124 workers were issued redundancy notices. This was on the basis no offers made to buy the site would provide a deliverable transaction to return to refining operations in the near term, that would have enabled all employees to be retained.
A letter later this Autumn from FTI to refinery employees clarified no offer would see refining operations within 12 months. It is now understood no offers put forward would provide a return to refining operations within the next few years.
The Government itself has put forward the Training Guarantee for refinery workers affected by the redundancies. This allows them to sign onto skills courses to help them transition into other sectors.
Westminster Hall debate
Mr Vickers secured the debate on the oil refinery sector earlier this Autumn. In it, he said Lindsey Oil Refinery has a capacity “equivalent to around 35 per cent of British petrol consumption and 10 per cent of British diesel”.
He outlined challenges faced by the refinery sector, from high energy costs, to carbon costs as high-polluting industry in the UK. He argued it disadvantaged UK refineries compared to elsewhere: “UK refineries are essentially competing with one hand tied behind their back while their competitors pay little or nothing in carbon costs.”
Mr Vickers warned of the impact a refinery closure could have. “We must realise that closing UK refineries does not reduce demand; it merely shifts production abroad. That, of course, often leads to higher emissions.”
On Lindsey Oil Refinery itself, he stated he had held talks with two consortia interested in maintaining it as a refinery, and North Lincolnshire Council’s leader had met a third. He asked whether the Government would support a deal that kept the refinery complete.
Mr Vickers also said he and Melanie Onn MP (Labour – Great Grimsby and Cleethorpes) had been told in a meeting with the Energy Minister a possible taskforce could be formed in the worst-case scenario of the refinery’s closure. Sir Edward Leigh MP (Gainsborough – Conservative) warned Lindsey Oil Refinery’s closure “is a disaster for our Greater Lincolnshire area”. He added many workers had lived in his constituency.
Junior minister Katie White’s response made no direct reference to Lindsey Oil Refinery. On carbon costs, she said it is reviewing compensation for energy-intensive industries.
“The Government are taking further steps to secure the long-term future of the UK refining sector and to ensure a just transition,” she said. This included a dedicated team established by the Department for Energy Security and Net Zero, working across Government and with the industry.