LONDON, June 26 Oil entrepreneur Gary Klesch is
in the final stages of exclusive talks with Murphy Oil
to buy its Milford Haven refinery in Wales and a decision on a
deal will be made this week, sources close to the negotiations
said on Thursday.
One source said an announcement on the future of the 135,000
barrel-per-day plant would be made by early next week at the
Swiss-based Klesch Group did not immediately respond to a
request for comment. A Murphy spokesman declined to comment.
If a deal is not done, it is expected that Murphy will move
to close the plant, putting most of its some 500 employees out
The plant is currently not buying crude oil, but recycling
oil products to keep it operational.
Murphy started a 45-day consultation period in April with
staff and unions, which it has left open since it elapsed in
One source familiar with the negotiations said that there
was roughly a 50 percent likelihood of a deal to keep the plant
open being done.
He said that any deal would likely value the plant at close
to zero, but any sum paid for the plant would include oil
Tom McKinlay, head of Murphy's Oil UK operations, stepped
aside to pursue the acquisition of the company's ailing Milford
Haven refinery and retail business, it emerged May.
One of the sources said that it was likely that McKinlay
would still be involved in the plant should the deal go through,
though it was unclear if there would be any element of
management ownership under the new structure.
Refineries in Europe are being squeezed by high crude prices
and low refining margins due to weak demand for fuel.
India's Essar Group plans to sell the Stanlow refinery in
Britain, three sources familiar with the matter said, although
the UK subsidiary of the company has since denied that the plant
is up for sale.
Last year, PetroIneos was on the brink of closing its
Grangemouth plant in Scotland after a bitter industrial dispute.
It survived after workers agreed to cuts in terms and
conditions, the British government made a pledge to provide a
loan guarantee, and the Scottish government promised a grant.
(Reporting by Simon Falush; editing by Jason Neely)