* Murco head steps aside to compete with Greybull and Klesch
* Firm extends talks with employees on refinery shutdown
(Adds details throughout)
By Ron Bousso and Simon Falush
LONDON, May 19 The head of Murphy's Oil UK
operations has stepped aside to pursue the acquisition of the
company's ailing Milford Haven refinery and retail business, a
source close to the company said on Monday.
Murco, Murphy's British subsidiary, has been engaged for
months in talks with several parties on the sale of the 135,000
barrels-per-day refinery and its assets.
Murco Managing Director Tom McKinlay told employees on
Friday he was taking a leave of absence. Brian Kelly, currently
head of Murphy's business development in West Africa, the Middle
East and Britain, will replace him and lead Murco's negotiations
with the potential buyers, the source said.
"Tom McKinlay has taken a leave of absence because he is
pursuing a management buyout in order to maintain integrity of
process," the source said.
A Murco spokeswoman could not immediately be reached for
A possible management buyout is the latest twist in Murphy's
four year-long quest to sell its downstream assets in Britain.
The Milford Haven plant in Wales stopped purchasing crude
oil last month and is in the process of reducing its operations
as stockpiles are expected to run out by next week, a second
After a plant is completely shut, restarting it typically
becomes prohibitively expensive.
Besides McKinlay's interest, other potential bidders include
private equity fund Greybull Capital and Swiss industrial group
Klesch, the first source said.
McKinlay is in the process of trying to get the funding for
a possible buyout, the first source said. Greybull was in
advanced stages of talks with Murco in March to buy the plant
and associated assets for around $500 million.
Last month, Murco started 45 days of consultation with
employees and their representatives on the future of the
loss-making refinery after it said talks had made no progress.
The consultation process was officially set to end in coming
days but will continue until the outcome of the talks becomes
clearer, the first source said.
European refiners have struggled with shrinking domestic
demand and increased overseas competition, which has crushed
margins, forced them to cut runs and led to losses.
(Reporting by Ron Bousso and Simon Falush; Editing by Dmitry
Zhdannikov and Jane Baird)